IDFC First Bank Ltd Performance Analysis

PROFITABILITY ANALYSIS
Mar-16 Mar-17 Mar-18

Rs in Crore Rs in Crore Rs in Crore

1 Total Assets 73969.87 112159.66 126520.18
2 Earning Assets
Balances with RBI 1900.84 3036.29 3050.86
Balances with Banks in Deposit Accounts 8291.05 40208.22 48198.20
Balances with Banks & money at Call & Short Notice 1003.07 2065.71 1840.94
Balances with Banks Outside India
Investments + 20091.18 50471.70 61201.53
Advances + 45699.43 49401.68 52164.89
Total Earning Assets 76985.57 145183.60 166456.42
3 Interest bearing Liabilities
Saving Deposits 755.96 7258.78 35326.61
Term & Other Deposits 77739.75 381138.42 424885.92
Borrowings 479138.31 50262.19 5778.37
Subordinated Debt
Total Interest bearing liabilities 557634.02 438659.38 465990.89

Equity Capital 3392.62 3399.01 3404.07

Reserves 10236.61 11277.97 11852.46
Total Equity 13629.23 14676.98 15256.53
5 Interest Income 3648.83 8532.71 8930.00
6 Interest Expenditure 2801.50 6515.39 7131.91
10 Non-interest operating income 403.20 1013.12 1117.89
11 Non-interest operating Expenditure 510.58 1276.98 1652.59
12 Provisions and Contingencies 273.09 733.72 404.09
Provisions and Contingencies include provision for tax 3585.18 8526.09 9188.59
Profit After tax 466.85 1019.74 859.30

Profitability Ratios
Return on Assets= NI/ TA 0.006 0.009 0.007
Equity Multiplier TA/ TE 5.43 7.64 8.29
TE/ TA 0.18 0.13 0.12
ROE=ROA X EM 0.03 0.07 0.06

NI/ OR 1.16 1.01 0.77

OR/ TA 0.01 0.01 0.01
TA/ TE 5.43 7.64 8.29

(II - IE)/ TA 0.011 0.018 0.014

(OI-OE)/ TA -0.001 -0.002 -0.004
Provisions/TA 0.00 0.01 0.00

(II- IE)/E A 0.011 0.014 0.011

EA/ TA 1.04 1.29 1.32
(II - IE)/ TA 0.01 0.02 0.01

NIM 0.01 0.02 0.01

II/ EA 0.047 0.059 0.054
IE/ Intt Bearing Liab 0.01 0.01 0.02
Intt Bearing Liabilities/ EA 199.05 67.33 65.34
Spread 0.04 0.04 0.04

Efficiency ratio= Non intt exp/ (Net Interest Income+Non intt income) 0.10 0.11 0.11

Risk Ratios
Liquidity Risk= Short term securities/ Deposits 0.09 0.18 0.73
Credit Risk = Provisioning / Assets 0.00 0.01 0.00
Capital Risk = Capital / Assets 0.05 0.03 0.03
Leverage ratio= Total equity/Total assets 0.18 0.13 0.12
Total capital ratio= (Total equity + Long-term debt + Reserve for loan
losses)/Total assets 7.72 4.04 3.80
Loan Ratio = Net loans/ Total assets 0.62 0.44 0.41

NPA 1139.04 576.47 891.16

Total Loans 45699.43 49401.68 52164.89
Nonperforming ratio= Nonperforming assets (nonaccrual loans and
restructured loans)/Total loans and leases 0.02 0.01 0.02

Wages and Salaries 256.63 573.62 675.97

Total Expenses 3609.36 8808.59 9424.68

Operating efficiency (cost control)= Wages and salaries/Total expenses

0.071 0.065 0.072

Other Financial Ratios

Tax rate = Total taxes paid/Net income before taxes
 Mar-19 Mar-20

Rs in Crore Rs in Crore
167184.86 149200.40

4149.53 3379.92
70479.01 65107.97
5417.25 810.86

58475.39 45404.58
86302.29 85595.36
224823.47 200298.69

67500.19 166929.21
613651.05 441683.01
8563.20 11352.64

689714.45 619964.86

4781.68 4809.90
13377.59 10532.70
18159.27 15342.60
11948.17 15867.31
8749.08 10232.00
938.56 1722.16
5886.73 5420.73
195.10 4800.95
14830.92 20453.68 Rise in bad loans has been impacting the net profit of the bank as we can see bank is heavily provisioning out of net profit
-1944.18 -2864.21

-0.012 -0.019 ROA is decreasing which means IDFC First Bank is definitely not in a good position as it is getting very little returns on the more and more
9.21 9.72 The trend here that we can see is that the Ratio is increasing which maens that the IDFC is using high amount of debts to finance all its asset
0.11 0.10
-0.11 -0.19 The ROE is fallng which indicates that the company is using much of its capital for generating the profits.

-2.07 -1.66 The net income of the bank is decreasing which means that the bank is not able to earn profits and it had under gone in losses for the past tw
0.01 0.01 The trend here indicates that the the assets are being used inefficiently as the ratio has remained very low over the period of five years.
9.21 9.72 The ratio is high and is increasing over the years which indicates that the company is taking substantial debt just to remain on its business rat

0.019 0.038
-0.030 -0.025
0.00 0.03 A good ratio equals 1 which means that the company owns more liabilities greater than the assets.

0.014 0.028 The net interest margin is slighty increasing which means that the investment efficiency is slighlty getting better year after year.
1.34 1.34 The ratio has remained same over the following years indicating that the assets are not being used much efficiently or we can even say that t
0.02 0.04

0.02 0.04 The net interest margin is slighty increasing which means that the investment efficiency is slighlty getting better year after year.
0.053 0.079 The investment income has remained low over the years indicating that the bank needs to work more on itself for generating some income w
0.01 0.02
78.83 60.59 The yeild on earning assets is very low over the years indicating that the bank is not able to meet its short term obligations and is at a risky p
 0.04 0.06 The banks interest has almost remained same over the last five years indiacting that the banks is not able to earn much more in its spread.

0.07 0.10 The efficiency ratio has remained low in the following years which indicates that the assets are being used inefficiently by the bank.

0.96 2.56 The liquidity risk ratio is increasing which means that the bank is trying to improve its risk position,
0.00 0.03 The credit risk ratio is almost negligible in the following years which means that the borrowers are able to pay off ther debts well in time.
0.03 0.03 The capital to risk asset ratio is very low in the recent fve years which indicates that the bank are facing inefficiency in the system.
0.11 0.10 The company is very linient in financing its growth with debt and therefore it had taken a good amount of debt which does not prove to be b

4.23 4.26 A ratio of 8% is considered as a good ratio under this. It indicates the efficiency and financial stability of the banks.
0.52 0.57 The loan ratio has changed slightly over the years which show that net loans take are cosiderabley more than its assets which is not a good in

1106.63 808.57 NPA's of the bank are under check over past years but bank has been provisioning a lot for bad loans.
86302.29 85595.36 Loan book of the bank has been decreased over past year but it has increased over past 5 years.

0.01 0.01 The gross Npa ratio is low in the following years which means that the bank's asset quality is in a good shape.

1118.19 1527.58 Bank is opening branches and that’s why employee cost has increased over past years
15241.22 24768.93

0.073 0.062 The operating efficency ratio has remained low over the years indicating that the company is more efficient in generating the revenue versus
rovisioning out of net profit

tting very little returns on the more and more investments it is making.
ng high amount of debts to finance all its assets. Too much reliance on Debt will increases the bankcruptcy risk and fall in the credit rating.

and it had under gone in losses for the past two years which is 2019 and 2020. this indicates bank has been provisioning for contingencies.
d very low over the period of five years.
bstantial debt just to remain on its business rather than relying on equity capital.

hlty getting better year after year.

sed much efficiently or we can even say that the bank is not able to generate passive income to its full capacity.

hlty getting better year after year.

k more on itself for generating some income which can comply with its earning assets.

et its short term obligations and is at a risky position.

 s not able to earn much more in its spread.

being used inefficiently by the bank.

s are able to pay off ther debts well in time.

re facing inefficiency in the system.
amount of debt which does not prove to be benificial for the company.

stability of the banks.

bley more than its assets which is not a good indicator for the banks.

more efficient in generating the revenue versus the total expenses.