You are here » Home » Companies » Company Overview » IDFC First Bank Ltd

IDFC First Bank Ltd.

BSE: 539437 Sector: Financials
NSE: IDFCFIRSTB ISIN Code: INE092T01019
BSE 00:00 | 25 Sep 29.30 2.30
(8.52%)
OPEN

27.25

HIGH

29.50

LOW

27.15

NSE 00:00 | 25 Sep 29.35 2.35
(8.70%)
OPEN

27.35

HIGH

29.50

LOW

27.15

OPEN 27.25
PREVIOUS CLOSE 27.00
VOLUME 3907709
52-Week high 48.00
52-Week low 17.75
P/E
Mkt Cap.(Rs cr) 16,620
Buy Price 29.30
Buy Qty 55.00
Sell Price 29.30
Sell Qty 245.00
OPEN 27.25
CLOSE 27.00
VOLUME 3907709
52-Week high 48.00
52-Week low 17.75
P/E
Mkt Cap.(Rs cr) 16,620
Buy Price 29.30
Buy Qty 55.00
Sell Price 29.30
Sell Qty 245.00

IDFC First Bank Ltd. (IDFCFIRSTB) - Chairman Speech

Company chairman speech

A year of transformation

Dear Shareholders

The world is going through an extraordinary time as the pandemic hits its businesseseconomies and lives.

The world's economic landscape was already fraught with uncertainties ranging fromtrade tensions between US and China to Brexit which led to volatility in global oilprices and financial markets.

For India the financial year 2019-20 started on a positive note with a landslidevictory for the incumbent BJP led government raising hopes for ongoing reforms. Thegovernment did not disappoint on this front and brought about some landmark changes suchas a sharp reduction in the corporate and Income Tax rates – both applicable subjectto the tax payer agreeing to forego all forms of tax exemption.

However despite policy actions by both the government and RBI the uncertainties withregard to the Twin Balance Sheet problem persisted – troubles in the NBFC sector didnot dissipate and deleveraging in the corporate sector continued. Core inflation remainedon a downward trajectory and the government announced reforms in the agriculture coal andfertilizer sectors and in regulations pertaining to labour.

The RBI supported the economy with a 110 bps cut in the repo rate starting from April2019 before pausing post October 2019 as a reaction to the spike in inflation. Howeverfollowing the COVID-19 crisis it resumed its rate cut cycle with a 75 bps cut in March2020 and further 40 bps in May 2020.

From October 1 2019 the RBI attempted to improve transmission of its policy rate cutsby making it mandatory for banks to link all fresh retail and SME loans to an externalbenchmark. It has been a consistent endeavor of the RBI to maintain adequate liquidity inthe system and they have also announced some targeted long-term repo operations for thebanks to enable them to invest in investment grade bonds of NBFCs.

During the year the banking sector saw significant developments including a megamerger of PSU banks which involved the folding of 10 banks into four. The governmentannounced a substantive recapitalization of PSU banks. The industry also witnessed thefirst instance of a financial sector entity a large HFC being admitted for bankruptcyproceedings. The RBI also acted boldly to provide liquidity support to the banking systemto ensure that

The Bank has come through the merger process very smoothly strengthening thefoundations for a transformed organisation while navigating pressures of a highlyuncertain external economic environment all at the same time. It is now well positioned -with a strong capital base superior corporate governance a disciplined approach to riskit is focused on growing its retail franchise using new technologies and a relentlesslycustomer first ethos.

Dr. Rajiv B Lall

Non-Executive Chairman

IDFC FIRST Bank

there was no systemic contagion from the problems at YES Bank. YES Bank itself had tobe rescued with equity infusion from SBI led consortium of stronger banks.

Towards the end of the financial year FY20 in view of economic disruption caused bythe pandemic the RBI announced an interest rate moratorium and ring-fenced banks from theimpact of the same by announcing that regulatory forbearance on account of moratoria willnot be accounted for as a default.

Looking ahead the banking sector could see some challenging times. Credit growth hasbeen slowing over time given the risk aversion of lenders and the declining demand fromborrowers affected by the economic disruption related to the pandemic. Credit growthslumped to 6.1% by end-March 2020 from 13% in end-March 2019. Balance sheets of banks wereon the mend in 2019 but the pandemic could temporarily upend this process.

With most forecasts anticipating a contraction in economic activity due to significantdisruptions caused by the pandemic FY21 is likely to remain a challenging year for theIndian economy and the banking sector.

A year of transformation

IDFC FIRST Bank has started FY21 with a position of strength.

In the year gone by FY20 the Bank weathered several challenges some quiteunprecedented. Despite this its performance has been extraordinary.

In its first full year of operations as a merged entity the Bank has strengthened andsignificantly transformed its balance sheet.

Under the leadership of V Vaidyanathan the Bank has struck the right balance acrossall dimensions – from diversifying the liabilities book retailising assetsimproving NIMs and strengthening structural liquidity and improving credit quality.

The Bank has come through the merger process very smoothly strengthening thefoundations for a transformed organisation while navigating pressures of a highlyuncertain external economic environment all at the same time. It is now well positioned -with a strong capital base superior corporate governance a disciplined approach to riskit is focused on growing its retail franchise using new technologies and a relentlesslycustomer first ethos.

These are tough times and during these times we stand by not only for our customersbut also our communities. We are committed to strengthening communities through our socialresponsibility and philanthropy initiatives.

On behalf of the Board management and employees I want to thank shareholders fortheir continued trust in the Bank.

We are building a bank that we expect will stand the test of time. I am confident theBank's inherent strengths and principles will enable us to endure and thrive.

Best regards

Dr. Rajiv B Lall

Non-Executive Chairman

IDFC FIRST Bank

.