Performance / Financial Highlights

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Performance / FinancialHighlights
March 2007
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Brief Profile

• Established on Nov 20th 1923 by the Veteran
  Freedom Fighter and a multi-faceted genius
  Dr Bhogaraju Pattabhi Seetaramaiah
• Nationalized on 15th April 1980
• Total Business Delivery Channels 1930
• Sponsored Two Regional Rural Banks
• Dividend Declared 24, 28, 30,35 and 38
  during the last five years.

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Performance Highlights for March 2007

• Total Business Rs. 69,687 Crores.
• Continues to maintain very Low NPA levels Gross
  NPAs _at_ 1.41 Net NPAs _at_ 0.17.
• Net Profit increased by 10.79 on Y on Y basis.
• CRAR stands at 11.33

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Branch Network
As on Rural Semi Urban Urban Metro Total
31.03.04 381 317 277 153 1128
31.03.05 385 329 294 160 1168
31.03.06 389 345 314 165 1213
31.03.07 396 372 342 179 1289

• Bank has presence in 22 States and 2 Union
  Territories

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Business Levels
(Rs in crores)
Details- 31.03.2006 Growth
Deposits
Advances (GBC)
Investments (Net)
C / D Ratio()
Net Interest Income
Operating Profit
Core Operating Profit (excluding Profit on sale of Investments)
Net Profit
Net NPAs
of Net NPAs to Net Advances
31.03.2007
33922
41454
22.20
22484
28233
25.57
11444
14301
24.97
66.69
68.28
1.59
1169
1418
21.30
703
931
32.43
632
951
50.47
486
538
10.79
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-9.13
52
0.24
0.17
-0.07
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Deposits - Composition
(Rs in crores)
Type of Deposit 31.3.04 31.03.05 31.03.06 31.03.07
Current Deposits 2218.94 2558.29 3084.82 3661.85
- Percentage Share 9.67 9.29 9.09 8.83
Savings Deposits 6348.12 7400.77 9232.39 10651.70
- Percentage Share 27.67 26.86 27.22 25.70
Term Deposits 14373.44 17591.65 21605.20 27140.47
- Percentage Share 62.66 63.85 63.69 65.47
T O T A L 22940.52 27550.71 33922.41 41454.02
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Deposits - Average
(Rs in crores)
Type of Deposit 31.03.2004 31.03.2005 31.03.2006 31.03.2007
Average Current Deposits 1317.13 1778.83 2219.71 2466.72
Average Savings Deposits 5262.42 6712.14 8087.18 9751.96
Average Term Deposits 14415.58 14706.07 18258.93 21801.41
T O T A L 20995.13 23197.04 28565.82 34020.09
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Advances - Major Sector-Wise Exposure
(Rs in crores)
SECTOR 31.03.04 31.03.05 31.03.06 31.03.07
Food Credit 700 800 751 898
Non-food Credit 12684 17110 21733 27336
Growth in Non Food Credit 15.94 34.89 27.02 25.78
- Medium Large Industries 3511 4958 6412 9048
- Priority Sector 5144 7331 8627 11427
- Other Sectors 4029 4821 6694 7759
Gross Bank Credit 13384 17910 22484 28234
GROWTH IN GBC 12.48 33.82 25.24 25.59
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Retail Credit
(Rs in crores)
Category 31.03.04 31.03.05 31.03.06 31.03.07
Housing Loans (Direct) 1031 1263 1572 1774
Housing Loans (Indirect) 213 615 864 2204
Educational Loans 396 513 677 904
Other Retail Credit 1057 1324 1934 1739
Total 2697 3715 5047 6621
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Quality of Loan Assets
Asset Quality 31.03.04 31.03.05 31.03.06 31.03.07
Standard Assets 95.40 97.48 98.06 98.59
Sub-Standard Assets 1.55 0.75 0.51 0.79
Doubtful Assets 3.01 1.73 1.30 0.54
Loss Assets 0.04 0.04 0.13 0.08
T O T A L 100.00 100.00 100.00 100.00
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Non-performing Assets Year Wise Movement in
Five Years
As on Gross NPAs to Gross Advances Gross NPAs to Gross Advances Net NPAs to Net Advances Net NPAs to Net Advances
As on Rs. Crore Rs. Crore
31.03.2004 615.37 4.60 120.07 0.93
31.03.2005 440.93 2.46 48.97 0.28
31.03.2006 436.91 1.94 52.46 0.24
31.03.2007 397.01 1.41 47.25 0.17
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Provision Coverage for NPAs Slippage Ratios
As on Provision Coverage Slippage Ratio
31.03.2004 80.16 2.61
31.03.2005 88.22 1.18
31.03.2006 87.20 0.88
31.03.2007 86.52 1.11
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NPA Movement
(Rs in crores)
PARAMETER 31.03.04 31.03.05 31.03.06 31.03.07
Gross NPAs at the beginning of the period 580.70 615.37 440.93 436.91
Less Reduction during the period 259.89 324.68 157.28 283.56
NPAs after reduction 320.81 290.69 283.65 153.35
Add Additions during the period 294.56 150.24 153.26 243.66
Gross NPAs at the end of the period 615.37 440.93 436.91 397.01
Net NPAs at the end of the period 120.07 48.97 52.46 47.25
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Investments
(Rs in crores)
Particulars 31.03.2004 31.03.2005 31.03.2006 31.03.2007
Total (Net) Investments 10317.35 10646.28 11444.15 14300.72
Average Investments 10660.00 10112.08 10846.97 12295.34
Profit on Sale of Investments 401.76 385.51 70.84 53.71
Yield on Investments 8.92 8.14 7.29 7.34
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Investments - Composition
(Rs in crores)
Type of Investments 31.03.04 31.03.05 31.03.06 31.03.07
Government Securities 8810.14 8777.55 9749.29 11357.02
Other Approved Securities 212.52 152.99 153.14 148.54
Shares 89.02 243.64 133.98 216.28
Debentures and Bonds 956.25 1168.31 924.71 947.49
Subsidiaries and/ or Joint Ventures 9.31 9.31 9.31 9.31
Others (IDBI Deposits, IVPs, Units of UTI Mutual Funds and RIDF 240.11 294.48 473.74 1622.08
Total Investments 10317.35 10646.28 11444.15 14300.72
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Quality of Investments Portfolio

• Duration of Investment portfolio as on 31.03.2007
  is 4.92 years. (4.65 years as on 31.03.2006)
• Duration of AFS portfolio as on 31.03.07 is 2.31
  years (2.03 yrs as on 31.03.2006)
• NPAs in Investment Portfolio Rs. 0.47 lakhs
  100 provided (Rs.1.31 lakhs as on 31.03.2006)

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Profit Loss Account - Spread Management
(Rs in crores)
Particulars FY 2004 FY 2005 FY 2006 FY 2007
Interest Income 2227.26 2273.46 2674.37 3315.33
Interest Expenses 1316.68 1204.42 1505.39 1897.79
Interest Spread (NII) 910.58 1069.04 1168.98 1417.54
Net Interest Margin 3.78 3.58 3.32 3.20
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Interest Income
(Rs in crores)
Particulars FY 2004 FY 2005 FY 2006 FY 2007
Advances 1230.82 1358.60 1763.37 2303.40
Investment 951.16 823.27 790.60 896.43
Others 45.28 91.59 120.40 115.50
T O T A L 2227.26 2273.46 2674.37 3315.33
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Interest Expenses
(Rs in crores)
Particulars FY 2004 FY 2005 FY 2006 FY 2007
Interest on Deposits 1238.93 1129.42 1388.62 1810.78
Interest on Sub-ordinate Debt 45.78 49.33 60.32 46.80
Interest on Borrowings 31.98 25.67 56.45 40.21
T O T A L 1316.69 1204.42 1505.39 1897.79
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Profit Loss Account Non-interest Income
(Rs in crores)
A) Non-interest Income from Core Operations FY 2004 FY 2005 FY 2006 FY 2007
1. Commission Exchange 115.91 139.04 169.71 181.56
2) Dividend Income 14.76 9.94 8.42 5.95
3) Forex Profit 20.06 28.45 27.71 32.27
4) Other Income 125.55 190.41 114.87 173.40
Sub Total 276.28 367.84 320.71 393.18
B) Profit on Sale of Investment 401.76 385.51 70.84 53.71
Total Non Interest Income 678.04 753.35 391.55 446.89
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Non-Interest Expenditure
(Rs in crores)
Particular FY 2004 FY 2005 FY 2006 FY 2007 Variance over 2006
Establishment Expenses 409.41 539.53 492.89 548.80 11.34
Other Operating Expenses 249.05 289.93 365.05 384.39 5.30
T O T A L 658.46 829.46 857.94 933.19 8.77
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Provisions Contingencies
(Rs in crores)
Particulars FY 2004 FY 2005 FY 2006 FY 2007
Income Tax 224.09 222.77 80.00 247.00
Dep./Loss on revaluation of Investments -7.41 166.52 65.29 62.82
Provision for NPAs 242.53 12.40 40.00 38.57
Provision against Standard Assets 3.50 13.29 39.87 46.00
Amortization 3.96 66.47 0.00 0.00
Others 0.00 -8.62 - 8.07 -1.05
Total 466.67 472.83 217.09 393.34
For 2006-07 amortization expenses amounting to
Rs.73.58 crores are deducted from the other
income as per RBI guidelines. Similar effect is
carried for 2006 for the sake of comparison.
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Net Profit
(Rs in crores)
Particulars FY 2004 FY 2005 FY 2006 FY 2007
Operating Profit 930.17 992.93 702.59 931.24
Core Operating Profit (excl. Profit from sale of Investments) 528.40 607.42 631.75 877.53
Provisions 466.67 472.83 217.09 393.34
Net Profit 463.50 520.10 485.50 537.90
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Capital Structure
(Rs in crores)
YEAR TOTAL CAPITAL TIER-I CAPITAL TIER-II CAPITAL OF TIER-I TO TOTAL CAPITAL
31.03.2004 1778.00 1059.00 719.00 59.56
31.03.2005 2291.64 1519.00 772.64 66.28
31.03.2006 3295.71 2872.19 423.52 87.15
31.03.2007 3565.41 3141.43 423.97 88.11
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Financial / Performance Key Ratios and Indicators
at a Glance
FY 2004 FY 2005 FY 2006 FY 2007
Cost of Deposits 5.87 4.86 4.86 5.32
Yield on Advances 10.52 9.43 9.26 9.88
Yield on Investments 8.92 8.14 7.29 7.34
Contd
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Financial / Performance Key Ratios and Indicators
at a Glance
Ratios FY 2004 FY 2005 FY 2006 FY 2007
Non Interest Income to Average Working Funds 2.70 2.67 1.30 1.09
Cost of funds 5.24 4.27 4.28 4.63
Yield on funds 8.86 8.06 7.60 8.08
Net yield 3.62 3.79 3.32 3.45
Contd
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Financial / Performance Key Ratios and Indicators
at a Glance
Ratios FY 2004 FY 2005 FY 2006 FY 2007
Cost to Income Ratio 41.45 45.51 52.73 50.05
Staff Cost as of AWF 1.63 1.91 1.40 1.34
Other Operating Expenses as of AWF 0.99 1.03 1.04 0.94
Contd
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Earnings Ratios
FY 2004 FY 2005 FY 2006 FY 2007
Return on Avg. Assets (ROAA) 1.84 1.84 1.38 1.31
Return on Net Worth (RONW) 35.91 28.31 16.78 17.78
Earnings Per Share (Amount in rupees) (On annualized basis) 11.59 13.00 11.78 11.09
Book Value Per Share (Amount in rupees) 36.65 45.93 59.67 65.08
Contd
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Productivity Ratios
(Rs in Lakhs)
FY 2004 FY 2005 FY 2006 FY 2007
Business Per Employee 250.30 346.25 426.75 536.06
Gross Profit Per Branch 81.80 85.01 63.41 72.69
Net Profit Per Employee 3.50 3.97 3.69 4.14
Business Per Branch 3213.00 3885.87 4633.02 5406.51
Contd
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Capital Adequacy / Other Ratios
As on 31.03.04 As on 31.03.05 As on 31.03.06 As on 31.03.07
Tier I Capital Ratio 8.17 8.03 12.20 9.98
Tier II Capital Ratio 5.54 4.08 1.80 1.35
Total Capital Ratio (CRAR) 13.71 12.11 14.00 11.33
Net Worth to GBC 11.27 10.26 12.87 11.18
Net NPAs to Net worth 8.27 2.67 1.81 1.50
Net NPAs to Net Advances 0.93 0.28 0.24 0.17
Contd
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Additional DisclosuresBreak up of Investments
(Rs in crores)
Nature of Investments As on 31.03.2005 As on 31.03.2005 As on 31.03.2006 As on 31.03.2006 As on 31.03.2007 As on 31.03.2007
Nature of Investments Amt. of Total Amt. of Total Amt. of Total
SLR Securities 8398 78.88 9370 81.88 11450 78.52
Non-SLR Securities 1758 16.51 1584 13.84 2901 19.89
Recapitaliza-tion Bonds 490 4.61 490 4.28 232 1.59
Total 10646 100 11444 100 14583 100
Contd

• SLR maintained as on 31.03.2007 26.93 of NDTL

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Additional Disclosures

• CRAR as per extant guidelines of RBI including
  capital charge for Market Risk stands at 11.33
  as on 31.03.2007 as against 14.00 as on
  31.03.2006.
• If capital charge for Operational Risk, is also
  factored, the CRAR would stand at 10.36. (RWAs
  for Operational Risk as on 31.03.2007 are
  reckoned for this purpose)

Contd
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Business Delivery Channels / Service Outlets
FY 2004 FY 2005 FY 2006 FY 2007
Branches 1128 1168 1213 1289
Extension Counters 129 136 123 99
ATMs 272 330 391 505
Satellite Offices 44 38 37 37
TOTAL 1573 1672 1764 1930
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Intellectual Capital
As on OFFICERS CLERICAL STAFF SUB-STAFF TOTAL Clerical Staff to Officer Ratio
31-03-04 7753 3124 2218 13095 0.40
31-03-05 7989 2885 2233 13107 0.36
31-03-06 8072 2827 2270 13169 0.35
31-03-07 8021 2675 2285 12981 0.33
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Technology Initiatives / Value Added Services

• 100 Branch Computerization achieved by
  31.03.2003.
• ATMs increased from 391 as on 31.03.2006 to 505
  as on 31.03.2007.
• Branches/ECs connected to ATMs increased from 917
  as on 31.03.2006 to 1059 as on 31.03.2007
• No. of ATM/Debit cards increased from 1.83
  million as on 31.03.2006 to 2.34 million as on
  31.03.2007.
• Total shared ATM net work with IDBI Bank, UTI
  Bank, Indian Bank, HDFC Bank, SBI group and
  others stand at 17500

Contd
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Technology Initiatives/Value Added Services
Contd.,Cash Management Services commenced in
2004 - the following is the growth
Details 2004-05 2005-06 2006-07
No of Branches 56 123 128
No of Customers 65 86 113
Total Turnover Rs.818 Crs Rs.1147 Crs Rs.1523 Crs
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Technology Initiatives/Value Added Services
Contd., Cluster based Core Banking
Total Business Units covered 1104
Of which - Branches 1006
Extension Counters 83
Service Centers 15
of Branch network covered 78.50
of Business covered 93.50
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Technology Initiatives/Value Added Services

• Average ATM hits 1.36 lakhs per day.
• Mobile Recharging facility.
• e-r_at_il facility to book railway tickets in the
  internet
• Infi-net, the Internet Banking Facility
• Quikticket Facility to book Kingfisher Airlines
  tickets through ATMs of the Bank.
  
• Internet Payment Gateway
• Tech savvy products such as e-Seva, e-Hundi,
  Utility Bill Payment, Visa Electron Debit Card,
  Instant Funds Transfer, On-line Tax Accounting
  System, RTGS, ABB, Shared Clearing, E-BA1 etc.
• Various Insurance Linked Deposit products like AB
  Jeevan Prakash, AB Jeevan Prakash Plus, AB
  Arogyadaan and AB Flex.
• New Tech savvy product AB Kisan Vikas ATM Card
  has been introduced.

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Value Added Services

• Internet Payment Gateway
• FIRST BANK IN INDIA TO START BIOMETRICS ATM
• Introduced 8 a.m. to 8 p.m. and 7 day Banking in
  select branches to extend the Service hours to
  clientele.
• Imparting training to Agriculturists, Rural
  Unemployed youth on vocational courses through
  our 9 Rural Development Institutes.

Contd
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AWARDS REWARDS

• Best Bank Award for use of IT for customer
  service in semi-urban and rural areas from IDRBT
• Merit Award for Banking Sector subject to
  prudential supervision from SAFA (South Asian
  Federation of Accountants) amongst all South
  Asian Banks for the quality of the balance sheet.
• Fintech Asia 2006 Award for Any Branch
  Banking Initiatives.
• Rated second best bank under category of Asset
  Quality in Business Today KPMG Survey of Best
  Banks 2006.
• Joint Runner-up Award in the Best Payments
  initiative for promoting ATM Channel by IBA
  TFCI.

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HIGHLIGHTS DURING THE YEAR

• Andhra Bank has hosted the Bankers Conference
  BANCON-2006 in collaboration with the Indian
  Banks Association at Hyderabad.
• First Bank in India to introduce ATM with
  Biometric Access and audio guidance for the
  benefit of rural areas and illiterate customers.
• Mobile ATM facility provided at Kottayam for the
  benefit of Sabarimalai pilgrims.
• Internet Banking introduced.
• Special Facility to book Kingfisher Air tickets
  through the ATMs introduced.
• AB Kisan Vikas ATM Card introduced for the
  benefit of agricultural community.
• Facility to book train tickets through internet
  introduced.
• Opening of representative offices is under
  consideration Riyadh, Kuwait New Jersey.
• Preparations are underway for a joint venture in
  Banking operations in Malaysia with Bank of
  Baroda and Punjab National Bank as partners.

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FIRST BIO METRIC MOBILE ATM IN INDIA
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Results that define pursuit of Excellence are
due to

• Support from Customers, Stake-holders and Well
  Wishers,
• Team work of 13000 dedicated employees
  AND
• Excellent co-operation from Banking Analysts.

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• Thank You