It is a privilege and honour to address my first message to theshareholders of IDFC Bank as Chairperson of the Board of Directors. I have been associatedwith IDFC Bank as an Independent Director since July 2015.
I'm pleased to inform you that in just 18 months since the Bankstarted its operations we have achieved a transformation from a predominantlyinfrastructure financing institution to a Universal Bank with a complete suite of productsand services for the full spectrum of customers across the country.
FY17 was IDFC Bank's first full year of operations. During thisyear our Bank consolidated its position as a new age bank focused on delivering financialservices to all particularly to the underserved using technology at scale. An importantstrategic focus for the Bank is to accelerate our growth towards becoming a mass retailbank. A large customer base a nationwide network and serving the financially underservedwith banking products are key to generating long term value. Harnessing the power ofmobile and Aadhaar-based technology our Bank is delivering basic financial services toeven those without mobile phones.
Before I focus on the highlights of the year gone by along with detailson financial performance I would like to share with you two important aspects of the Bankthat I believe will build a strong sustainable institution for the future. The first isthe heart and soul of an institutionthe philosophy that drives our strategy and ourpeople. The second is the investment in physical and digital infrastructure for the longterm. These lay the foundation for the Bank to deliver value on a sustained basis to youour shareholders. At IDFC Bank our dharma for our customers is to materially deepen andbroaden our reach delivering differentiated service to the full range of customers -corporate and retail urban and rural through innovation in products processes andtechnology empowering the communities we serve to grow and prosper. This dharma is animportant aspect of who we are it drives the culture for our people and ensures valuesthat we stand for get translated into a unique and differentiated customer experience. Inthe last 18 months we have hired over 3000 people from disparate backgrounds; our Bankhas made a significant effort in training and development to ensure that a unique IDFC wayof doing banking gets embedded amongst our people. As a young Bank we are seeking to setnew standards in customer experience using technology and a service-oriented approachthat makes banking simple accessible anytime and from anywhere. We focus on solutionsinstead of products delivered efficiently with speed all backed by a service approachthat feels personalised and is consistently offered across all customer segments. Ouremployee values of Balance Collaboration Drive and Honesty form the backbone of thiscustomer promise. I take this opportunity to thank all employees for their wholeheartedsupport in the build-out of the Bank and its several achievements over the last 18 months.We believe in equal opportunities for personal and professional growth for all building aperformance and knowledge-based employee team which strengthens our ability to deliver onour stated goals. For the first time in the history of banking in India the digitalinfrastructure in the country makes it possible to deliver banking services to even thesmallest business or individual at an affordable cost. IDFC Bank'sPoints-of-Presence (PoPs') which combines bank branches MicroATM network andBusiness Correspondent partnerships enables it to serve customers with / without phoneswithout sacrificing the customer connect. Our lack of legacy platforms allows us to benimble agile and flexible to meet the growing demands of today's digitally savvy andtechnologically accustomed clients. It also gives us the ability to innovate and launchnew products for quick adoption.
We delivered a strong financial performance in our first full year ofoperations. The profit after tax for FY17 was Rs 1020 crore up 25% over the previousyear's annualised profit. The Bank has acquired an active customer base of approx. 14lacs and made rapid strides in spreading our network across the country. We have alreadyestablished a network of over 8613 PoPs across 20 states 19 major cities 150 districtsand 33000 villages across the country. The network comprises 74 bank branches 47 ATMs350 corporate Business Correspondent branches (which include NBFCs and finance companiesrepresenting IDFC Bank for microlending) and 8142 outlets which include MicroATMscashless PDS outlets and Aadhaar Pay merchant points. This is reflective of the focus onoverlaying a deep digital penetration on a lean branch structure.
We now have a complete set of solutions across all our businesses. Froma diverse set of wealth management products to a comprehensive lending product suite toliability and asset products for rural customers. We endeavour to provide customisedfinancial solutions to corporates individuals small and micro-enterprisesentrepreneurs financial institutions and the government. This is supported by a customerexperience that is delivered in a simple and transparent manner. Customers can speak totrained bankers through our Banker on Call facility access the Bank and its productsthrough MicroATMs placed in shops across the country or use any of our state of the artdigital apps and solutions built to be intuitive and simplistic. One of the key newdevelopments was the launch of IDFC Aadhaar Pay. This unique payment solution leveragesthe power of Aadhaar to enable payments with your thumb. The solution is drivingtransformation in the payments space and is fully aligned to the government's agendaof a digitised India.
Being a digital organisation is strategic for the Bank. We deliverbanking to customers based on her / his access to mobile telephony. Customers may have asmart phone or a feature phone and some others who may have no phone at all. Our Bank isdesigned to deliver financial services to all three of these customer segments. The Bankserves the smartphone customer segment with a banking app that provides access to a wholerange of services. For the phone-less and feature phone population the Bank is reachingthese customers through a countrywide network of Business Correspondents using MicroATMsand apps such as Unified Payments Interface and Aadhaar Pay.
In line with the strategy of serving the mass market particularly theunderserved the Bank acquired Grama Vidiyal Micro Finance Limited (GVMFL').GVMFL now renamed as IDFC Bharat Limited is a wholly owned subsidiary of IDFC Bank.GVMFL was a profitable entity with net profits of Rs 42 crore in FY16 319 branches anactive customer base of approx. 10 lacs and has been fully integrated into the bank as aBusiness Correspondent. This large customer base which primarily received loans throughGVMFL now has access to a full range of financial products and services customised fortheir needs.
Since inception we have believed that good and effective CorporateGovernance plays an important role in achieving the corporate vision and mission of theorganisation. This is an area of strong focus and on behalf of the Board of Directors Ican assure you that we are committed to the highest standards of Corporate Governance andtransparency. The Bank in partnership with IDFC Foundation is committed to serving thecommunities we operate in through various rural livelihood programs. A key initiativelaunched this year is the Rural Livelihoods and Development program. This entails skillingrural youth to become Aadhaar-enabled Business Correspondent agents for improvingfinancial inclusion and literacy.
The Bank continues to be extremely well capitalised and is ideallyplaced to execute identified as well as emerging opportunities. The Bank also has a robustrisk and compliance framework built around people technology and processes.
The Executive Committee of the Bank comprises proven leadership led bythe Founder Managing Director & CEO and has delivered a strong performance in FY17while laying a robust base for the strategic way forward.
The Bank has received several awards and been recognised in variousways for its achievements in its first year of operations. These include the NationalPayments Excellence Award 2016 by National Payments Corporation of India the DomesticBond Award Honour by IFR Asia and the Visual Merchandising and Retail Design Award toname a few. I believe that all of this is reflective of the foundation built for thefuture in a manner that will enable the institution to remain relevant with the passageof time bringing alive our promise to always be The Bank of Now'. I'mconfident that as we progress on our vision we will deliver significant value to ourshareholders employees as well as all the communities that we serve across the nation. Ithank all shareholders for their belief in the Bank's performance and plans. I lookforward to your continued support.