Investor Presentaiton
Section 1: The Founding of IDFC FIRST Bank..
Erstwhile IDFC BANK
Continued from page 6
The bank was launched through this demerger from IDFC Limited in
November 2015. During the subsequent three years, the bank
developed a strong and robust framework including strong IT
capabilities for scaling up the banking operations.
The Bank designed efficient treasury management system for its own
proprietary trading, as well as for managing client operations. The
bank started building Corporate banking businesses. Recognizing the
change in the Indian landscape, emerging risk in infrastructure
financing, and the low margins in corporate banking, the bank
launched retail business for assets and liabilities and put together a
strategy to retailise its loan book to diversify and to increase margins.
Since retail required specialized skills, seasoning, and scale, the Bank
was looking for inorganic opportunities for merger with a retail lending
partner who already had scale, profitability and specialized skills.
As part of its strategy to diversify its loan book from infrastructure,
the bank was looking for a merger with a retail finance institution
with adequate scale, profitability and specialized skills.
Erstwhile CAPITAL FIRST LIMITED
Continued from page 6
Between March 31, 2010 to March 31, 2018, the Company's Retail
Assets under Management increased from Rs. 94 crore ($14m) to Rs.
29,625 crore ($4 b, Sep 2018). The company financed seven million
customers for Rs. 60,000 crores ($8.5b) through new age technology
models.
The company turned around from losses of Rs. 30 crore and Rs. 32
crore in FY 09 and FY 10 respectively, to Rs. 327 crore by 2018,
representing a 5 year CAGR increase of 56%. The loan assets grew at a 5
year CAGR of 29%.
The ROE steadily rose from losses in 2010 to 15% by 2018. The market
capitalization of the company increased ten-fold from Rs. 780 crore on
in March 2012 at the time of the LBO to over Rs. 8000 crore in January
2018 at the time of announcement of the merger.
As per its stated strategy, the company was looking out for a banking
license as it was a non-deposit taking NBFC and funding could be a
constraint for growth.
Erstwhile Capital First, as part of its stated strategy, was on the
lookout for a commercial banking license in order to access retail
deposits.
11
IDFC FIRST
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