analyst presentation september 2011

Relationship beyond banking

ANALYST PRESENTATIONSEPTEMBER 2011

1

BANK OF INDIA


Journey Commenced here - 1906 Corporate Office BKC, Mumbai- 2003

BANK OF INDIAFRONT-RUNNER IN INDIA’S GROWTH STORY


Milestones

1906: Group of eminent businessmen establishes the Bank1946: Opening of London Branch – First-ever Indian bank to open a branch

overseas1950: Opening of Tokyo Branch – First Indian bank to open a branch in Japan1969: Nationalization along with 13 other banks – branch network: Indian:

207 & Foreign: 121989: Established BoI Shareholding Ltd. – a JV with Bombay Stock

Exchange (BSE) to manage clearing house of BSE1997: Launched maiden IPO – Government shareholding diluted to 76.53%2003: Ranked as India’s Most Trusted Service Brand consecutively for 3

years by AC Nielsen ORG-MARG2004: Ranked 25th among India’s Top 500 companies by D & B2007: Surpassed landmark of ` 10 bn in net-profits2008: Surpassed landmark of ` 20 bn in net-profits2009: Surpassed landmark of ` 30 bn in net-profits2010: Surpassed Business Mix of ` 4000 bn2011: Surpassed Business Mix of ` 5000 bn

3


Awards & Accolades

Dun & Brad Street Award for the Best Public Sector Bank Category-2010 The Second PSU Award 2010 by Dalal Street. The award of the most efficient Public Sector Bank based on the

Operating Profit / Total number of employees , Growth in operating profit and Balance Sheet Profit.

IBA banking Technology Award 2009 for the Best Business Enablement Initiatives.

National Award for Excellence in Lending to Micro & Small Enterprises. Best Education Loan Provider: Outlook Money – NDTV Profit Awards. ‘Winner Award’ in the ‘Best Business Enablement Initiative’ Category by

IBA

4


Awards & Accolades BOI rated by Economic Times/AC Nielsen Survey for ‘The Most Trusted Brands”

(MTB) 2009 - 2nd under PSU Banks Category (next to SBI) 8th in Top Service Brands Secured 92nd place in MTB – an improvement of 54 rankings as compared to

previous year Won the Award for Top Public Sector Bank under Best Bank Category &Overall

Best Bank by D & B Banking Awards 2009 First major PSU bank to receive ISO 27001:2005 certification for Data Centre &

Disaster Recovery Centre International Award in Outsourcing – Sponsored by Everest Group &

Forbes at New York, USA Special Award for Green IT at CIO-100 event for Solar Power Runners’ Up Award – FE India’s Best Bank Awards

5


New Intiatives

6

The Bank reorganised its organisation structure to a more customer focus institution capable of encashing the emerging oppurtunities. Accordingly, customer focused verticals i.e Large Corporate, Mid Corporate , SME, Retail, Rural etc. established

20 specialized SME Centres, 21 Retail Business Centres and 52 Rural Credit Processing hubs established to provide focused attention and to accelerate credit delivery to the vital segments.

Launched BOI Kisan Sathi to benefit tenant farmers, Launched Jai Jawan Salary plus scheme for defense personnel, Star Suraksha SB plus with free accidental death insurance of ` 50,000

Launched ‘BINGO’ ATM cum Debit card for youths

Bank has started process of UID (Unique identification number), ‘Adhar’ in coordination with UIAI with a target to map 1crore citizens


New Intiatives (Contd)

7

• The Bank introduced BOI * INTERNATIONAL TRAVEL CARD in US$ during the half year ended September 2011 with Visa affiliation for the customers visiting abroad

• The Bank launched BOI* Pension Aadhaar Card for pensioner during

the half year September 2011

• The Bank launched BOI Privilege international Credit Card and Debit Card during the half year September 2011

• The Bank has also launched "BOI Star Rewardz" programme for our Debit Card holders to encourage its use at POS during half year September 2011.


IT / ITES Intiatives

8

117 new ATMs installed during current FY thus taking the total ATMs to 1602.

Mobile Banking services extended to all retail internet banking customers

Bank has implemented Two Factor Authentication (2FA) – star Token for both Retail and Corporate internet banking customers as an additional security measure.

Credit Application Processing Systems (CAPS) introduced covering all major credit segments –Retail, Corporate , MSME and Agriculture

Launched ‘BTM’ (Banking Through Mobile) to enable remittances and transfers using mobile phone


Promoter(GOI), 65.86%FIs/Banks,

0.32%

Insurance Cos, 11.49%

Mutual Funds, 0.62%

Corporate Bodies, 0.76%

NRIs/FII, 15.25%Indian Public,

5.70%SEP-11

Promoter(GOI)FIs/BanksInsurance CosMutual FundsCorporate BodiesNRIs/FII

Investor Profile- Shareholding Pattern (%)

Total Foreign Holding 15.25 %

9


Global Footprints – Foreign Branches of the Bank

Japan (Tokyo & Osaka)Phnom Penh

SingaporeJakartaHo Chi Minh

Hong Kong KowloonShenzen

Jo’burgh (SA)

Kenya (Nairobi, Mombasa,Ind Area & Westlands)

Europe-France (Paris)-Belgium (Antwerp)

UK (London + 7branches)

Channel Islands

USA (New York & SFO)

West Indies- Cayman Islands

Tanzania(Subsidiary),

Dubai

10

New Zealand


Credit Rating - International & Domestic

Rating Agency Rating International Ratings

• Moody’s Baa2

• S & PBBB-

Domestic• CRISIL AAA (For Bonds)• CARE AAA(Is) (Issuer Rating)• CARE AAA(For Bonds)

• Brickwork Ratings BWR AAA (For Bonds)• ICRA MAAA (For Term Deposits)

11

Relationship beyond banking 12

Sep-10 Dec-10 Mar -11 Jun -11 Sep-11

Business Mix 4,254,479 4,452,795 5,150,401 5,080,339 5,160,250

Deposits 2,410,711 2,525,257 2,988,858 2,930,984 2,990,741

Advances 1,843,768 1,927,538 2,161,543 2,149,355 2,169,509

Operating Profit 13,796 13,888 12,053 13,959 15,515

Net Profit 6,168 6,532 4,936 5,175 4,911

NIM (%) 2.81 3.09 2.94 2.19 2.44

Gross NPA (%) 2.64 2.36 2.23 2.69 3.02

Net NPA (%) 1.14 0.88 0.91 1.27 1.98

Return on Assets(%) 0.87 0.89 0.61 0.59 0.56

Rtn. on Equity (%) 18.29 18.50 13.19 13.13 12.07

Book Value (`) 262.36 274.78 283.24 292.90 301.87

Major Business Parameters (`/Mn)


362.43 459.23 545.392048.28 2529.63 2445.352410.71 2988.86 2990.74

SEP 10 March 11 Sep 11

DepositsForeign Indian Global

Deposits

Domestic Deposits

Y-o-Y Growth : 19.39 %

Foreign Deposits

Y-o-Y Growth: 50.48 %

Global Deposits


`/ Bn

13


Domestic Deposits (CASA)

680,678 692,872 731,385 741,675 766,524

541,532 556,665 587,218 588,384 635,129

139,146 136,207 144,167 153,291 131,395

0100,000200,000300,000400,000500,000600,000700,000800,000900,000

Sep-10 Dec-10 Mar-11 Jun-11 Sep-11

CASA

SB

CD

Savings Bank

Y-o-Y Growth: 17.28%

CASA

Y-o-Y Growth:12.61 %

`/Mn

14

Share of CASA to

Aggregate Dep: 31.64%


METRO1429.68

58%

URBAN441.31

18%

SEMIURBAN292.42

12%

RURAL283.41

12%

Sep'11

Domestic Deposits – Category-wise

`/ Bn

15


396.81 510.07 590.871,446.96

1,651.47 1,578.631843.772161.54 2169.50

0100020003000

Sep'10 March'11 Sep'11

FOREIGN INDIAN GLOBAL

Gross Advances`/ Bn

Domestic


Foreign


Global


16


METRO1101.62

68%

URBAN256.07

16%

SEMIURBAN122.28

7%

RURAL142.73

9%

Sep- 11

Domestic Advances – Category Wise as on 30.09.2011

17

`/ Bn


Key Sectors(Domestic Credits)

Sep-10 Sep—11 % Y-o-YGrowth

Agriculture 193,020 196,410 1.76

SME (Priority & Non Priority)

272,530 252,140 -7.48

Retail Credit 153,270 163,950 6.97

Corporate 827,790 966,140 16.71

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`/Mn


Advances to Sensitive Sectors - Domestic `/ Mn

19

SECTORSEP-10 DEC-10 MAR-11 JUN-11 Sep-11 % of Total

Advances

Total Advances1,446,963 1,509,030 1,651,472 1,611,230 1,578,634

REAL ESTATE 177,350 194,974 203,623 203,490 205,015 12.99

Out of which

HOUSING LOAN74,490 75,610 74,783 78,401 79,466 5.30

MORTGAGE LOAN 15,770 15,190 14,950 19,843 17,372 1.10

COMML. REAL ESTATE 47,010 47,013 40,546 38,170 37,297 2.36

Others(Invest & Indirect) 40,800 58,540 73,344 22,803 70,880 4.49

CAPITAL MARKET 30,600 33,044 32,451 34,920 33,896 2.15


Domestic Foreign Global

> 10 Mn < 10 Mn Total Amount Amount Amount

As on 31.03.2011 78,673 15,451 94,124 12,322 106,446

Additions during Q1 9,000 159 9,159 168 9,327

Less Repayment in Restructured a/c s / Exchange fluctuation

-3879 -800 -4679 -79 -4758

As on 30.06.2011 83,794 14,810 98,604 12,411 111,015

Additions during Q2 4,396 455 4,851 2,866 7,717


-6,320 -765 -7,085 -495 -7580

As on 30.09.2011 81,870 14,500 96,370 14,782 111,152

RESTRUCTURED ACCOUNTS Includes all facilities of the borrowers

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`/Mn


MOVEMENT OF NPA IN RESTRUCTURED ACCOUNTS

21

`/Mn

Domestic Foreign Global% of Total Restructured

A/cs

> 10 Mn < 10Mn Total Amount

Amount Amount

As on 31.03.2011 16,885 1,253 18,138 - 18,138 17.04

Additions during Q1 3,591 750 4,341 - 4,341

Less Repayment in Restructured a/c s /Exchangefluctuation

-954 -62 -1,016 - -1,016

As on 30.06.2011 21,430 1,941 23,371 - 23,371 21.04

Additions during Q2 3271 214 3,485 874 4,359


1,044 15 1,059 - 1,059

As on 30.09.2011 23,657 2,140 25,797 874 26,671 23.20

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NPA Movement ( `/ Mn)

Half Year Ended

Sep-10 Sep-11

Indian Foreign Global Indian Foreign Global

Opening Gross NPA 44,812 4,014 48,826 43,566 4,550 48,116

Total Reduction 13,122 479 13,601 25,300 170 25,470

Recovery 4,139 127 4,266 5,195 90 5,285

Upgradation 3,221 22 3,243 2,726 0 2,726

Write-off 5,762 330 6,092 17,380 80 17,460

Slippages 13,430 934 14,364 42,229 2,825 45,054

NetAddition/Reduction

-308 -455 -763 -16,929 -2,655 -19,584

Gross NPA 45,120 4,469 49,589 60,494 7,205 67,699

Less Unrealised Interest on NPA 889 4 893 2,210 8 2,218

Closing Gross NPA 44,231 4,465 48,696 58,284 7,197 65,481

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Sep-10 Sep-11


Gross NPA 44,232 4,464 48,696 58,283 7,197 65,480

Total Nettable Credits 26,486 2,914 29,400 18,707 4,328 23,035

NPA Provision 18,768 2,899 21,667 12,450 4,266 16,716

Other credits 7,718 15 7,733 6,257 62 6,319

Net NPA 19,139 1,565 20,704 39,576 2,869 42,445

Gross NPA Ratio (%) 3.06 1.13 2.64 3.69 1.22 3.02

Net NPA Ratio (%) 1.35 0.40 1.14 2.54 0.49 1.98

Provision Coverage Ratio (%) 70.38 64.93 70.03 59.06 60.14 59.13

(`/Mn)

23

NPA Sequential Ratios


Sector wise Breakup of NPA - Domestic

` / Mn

Sep- 11 % of Total NPA % of Total Sectoral Advances

Agriculture11,960 20.52 5.16

Industry24,186 41.50 3.63

Services15,785 27.08 2.98

Personal Loans6,353 10.90 4.21

DOMESTIC ( TOTAL)58,284 100

FOREIGN7,197

GLOBAL (TOTAL)65,481

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Overseas NPAs

` / Mn

Sep -10 Sep- 11

TRADE 2,107 3,563

MANUFACTURING 155 768

REAL ESTATE 1,461 1,424

OTHERS 784 1,442TOTAL 4,507 7,197

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Profit – Summary

` Mn

Qtr Sep 2010

Qtr Dec2010

Qtr Mar 2011

Qtr Jun 2011

Qtr.Sep 2011

Variation Y-o-Y (%)

1 Interest Earned 51,556 54,675 63,069 66,335 68,864 33.57%

2 Interest Expended 33,795 34,806 39,996 47,926 49,825 47.43%

3 Net Interest Income (1 - 2) 17,761 19,869 23,073 18,409 19,039 7.20%

4 Non-Interest Income 5,845 6,482 8,231 6,601 8,418 44.02%

5 Total Operating Income (3+4) 23,606 26,351 31,304 25,010 27,457 16.31%

6 Operating Expenses 9,810 12,463 19,251 11,051 11,942 21.73%

7 Operating Profit (5 - 6) 13,796 13,888 12,053 13,959 15,515 12.46%

8 Total Provision 7,628 7,356 7,117 8,784 10,604 39.01%

9 Net Profit 6,168 6,532 4,936 5,175 4,911 -20.38%

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Net Interest Income ` / Mn

Qtr. Sep-10

Qtr. Dec-10

Qtr. Mar-11

Qtr. Jun-11

Qtr.Sep -11

VariationY-o-Y(%)

TOTAL INTEREST INCOME 51,555 54,675 63,069 66,335 68,864 33.57%

INT. INCOME FROM ADVANCES 36,598 40,234 43,252 45,959

48,865 33.52%

INT. INCOME FROM INVESTMENTS 13,071 12,750 14,119 16,406

18,431 41.01%

OTHER INTEREST INCOME 1,886 1,691 5,698 3,970 1,568 -16.86%

TOTAL INTEREST EXPENDED 33,795 34,806 39,996 47,926

49,825 47.43%

INT. EXPENDED ON DEPOSITS 29,160 29,879 35,249 43,837

45,055 54.51%

INT. EXPENDED ON BORRROWINGS 2,065 2,473 2,340 1,517

2,099 1.65%

INTEREST EXPENSES ON SUBORDINATED DEBT etc. 2,570 2,454 2,408 2,470

2,671 3.93%

NET INTEREST INCOME 17,760 19,869 23,073 18,409 19,039 7.20%

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ParticularsHalf Year ended

Variation H1-o-H1 %Sep -10 Sep-11

Interest Income 99,773 135,199 35.51%a. From Advances 71,517 94,824 32.59%

b. From Investments 24,848 34,838 40.20%

c. Other Interest Income 3,408 5,537 62.50%

Interest Expended 64,608 97,751 51.30%

a. On Deposits 56,658 88,892 56.89%

b. On Borrowings 3,316 3,616 9.05%c. Subordinated Bonds 3,030 3,329 9.87%

d. Others 1,604 1,914 19.33%

Net Interest Income 35,165 37,449 6.50%

Net Interest Income(H1-o-H1)( `/Mn)


IncomeHalf Year ended

H1-o-H1 %Sep 10 Sep 11

1. Total Income 111,477 150,218 34.75%

a. Interest Income 99,773 135,199 35.51%

b. Non Interest Income 11,704 15,019 28.32%

2. Total Expenditure 83,575 120,744 44.47%

a. Interest expended 64,608 97,751 51.30%

b. Operating Expenses 18,968 22,993 21.22%

3. Operating Profit 27,902 29,475 5.64%

4. Profit before Tax 18,769 12,260 -34.68%

5. Profit After Tax 13,419 10,086 -24.84%

Profitability (H1-o-H1)

(`/Mn)


Non-interest Income ` / Mn

Qtr Sep-10

Qtr Dec-10

QtrMar- 11

QtrJun- 11

Qtr. Sep-11

VariationY-o-Y (%)

Treasury:PROFIT FROM SALE OF SECURITIES 360 592 1,266 1,097 1,544 328.89%

PROFIT FROM EXCHANGE TRANSACTIONS 1,111 1,271 1,334 1,471 1,483 33.48%

Sub Total (A) 1,471 1,863 2,600 2,568 3,027 105.78%

Core-banking Operations:

COMMISSION / EXCHANGE / BROKERAGE 3,007 2,838 3,468 2,737 3,258 8.35%

OTHER NON-INTEREST INCOME 1,065 1,124 1,244 984 1,257 18.03%

Sub Total (B) 4,072 3,962 4,712 3,721 4,515 10.88%

RECOVERY IN WRITTEN OFF ACCOUNTS (C) 301 658 919 312 876 191.03%

TOTAL NON-INTEREST INCOME (A+B+C) 5,845 6,483 8,231 6,601 8,418 44.02%33


ParticularsHalf Year ended Variation

H1-o-H1 %Sep -10 Sep-11

Commission, Exchange & Brokerage 5,505 5,995 8.90%

Profit from Sale of Investments 1,360 2,641 94.19%

Profit from Exchange Transactions 2,420 2,954 22.07%

Recovery In W/o accounts 670 1,188 77.31%

Other Non Interest Income 1,749 2,241 28.13%

Total Non Interest Income 11,704 15,019 28.32%

Core Non Interest Income Net of Treasury & Recovery in W/o Accounts 7,254 8,236 13.54%

Non Interest Income(H1-o-H1) (`/Mn)


Cost & Yield Ratios –Quarterly Comparison

32

Qtr Sep-10 Qtr Dec 10 Qtr Mar 11 Qtr Jun 11 Qtr. Sep 11

INDIAN FOREIGN GLOBAL INDIAN FOREIGN GLOBAL INDIAN FOREIGN GLOBAL INDIAN FOREIGN GLOBAL INDIAN FOREIGN GLOBAL

Cost of Deposits 5.65 1.30 4.99 5.61 1.28 4.97 6.08 1.15 5.32 6.87 1.17 6.01 7.07 1.24 6.09

Yield on Advances 10.04 3.09 8.47 10.35 3.05 8.78 10.67 2.82 8.81 10.84 2.80 8.89 11.69 2.92 9.41

Yield on Investments 7.48 4.22 7.26 7.93 4.67 7.71 8.27 4.68 8.04 7.50 4.67 7.37 7.95 4.68 7.82

Yield on Funds 8.05 3.42 7.25 8.29 3.30 7.43 8.71 3.21 7.76 8.58 3.16 7.61 9.20 3.22 8.06

Cost of Funds 5.32 2.04 4.75 5.32 1.89 4.73 5.54 1.95 4.92 6.26 1.97 5.50 6.47 2.04 5.60

N.I.M. 3.17 1.37 2.81 3.49 1.45 3.09 3.38 1.24 2.94 2.43 1.22 2.11 2.77 1.20 2.44

Cost and Yield (%)


Sep 2010 Sep 2011


Cost of Deposits 5.51 1.29 4.89 6.97 1.21 6.05

Cost of Funds 5.12 2.00 4.58 6.28 1.94 5.46

Yield on Advances 9.97 2.99 8.43 11.26 2.86 9.15

Yield on Investments 7.32 4.21 7.09 7.73 4.67 7.60

Yield on Funds 7.87 3.26 7.07 8.90 3.09 7.80

Interest Spread 2.75 1.26 2.49 2.62 1.15 2.34

Net Interest Margin 3.19 1.29 2.83 2.60 1.21 2.31

Profit Ratios(H1-o-H1)


Business Ratios – Quarterly Comparison

Sep-10 Dec-10 Mar-11 Jun-11 Sep-11

Cost to Income Ratio 41.56 47.30 61.50 44.19 43.49

Non Interest income to Operating Expenses 59.58 52.01 42.76 59.73 70.49

Asset Utilization Ratio 1.94 1.89 1.48 1.60 1.78

Return on Assets 0.87 0.89 0.61 0.59 0.56

Return on Equity 18.29 18.50 13.19 13.13 12.07

Earnings Per Share (Basic & Diluted) 11.74 12.44 9.37 9.47 8.99

Book value per share 262.36 274.78 283.24 292.90 301.87

Net worth (Rs. in Mn) 137,979 144,511 154,995 160,279 165,191

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Investments - Domestic `/Mn

Sep-10 Sep-11AFS HTM HFT TOTAL AFS HTM HFT TOTAL

1 SLR INVESTMENTS 120,890 452,650 2,640 576,180 131,659 549,830 - 681,489

OF WHICH:

GOVERNMENT SECURITIES 119,460 450,410 2,640 572,510 129,933 548,510 - 678,443

OTHER APPROVED SECURITIES 1,430 2,240 - 3,670 1,726 1,320 - 3,046

M Duration - AFS 2.60 5.75 5.81 5.09 1.59 5.02 - 4.36

2 NON SLR INVESTMENTS 49,220 8,690 20 57,930 187,998 10,378 198,376

M Duration 2.30 0.19 - 2.12 0.61 0.65 - 0.60

TOTAL 170,110 461,340 2,660 634,110 319,657 560,208 879,865

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Capital Adequacy –Basel II`/Mn

30.09.2010 31.12.2010 31.03.2011 30.06.2011 30.09.2011

Tier I Capital 142,090 140,700 170,470 170,550 170,840

Tier II Capital 79,060 78,360 78,670 75,630 76,760

Total Capital 221,150 219,060 249,140 246,180 247,600

Total Assets 2,896,250 2,991,853 3,511,725 3,459,576 3,514,381

Risk Weighted Assets 1,695,310 1,764,450 2,047,620 2,126,990 2,069,270

CRAR - Tier I (%)8.38 7.97 8.33 8.02 8.26

CRAR - Tier II (%)4.66 4.44 3.84 3.55 3.71

CRAR (%) 13.04 12.41 12.17 11.57 11.97

36


1,1171,156

1,239 1,265 1,2581,310

1,4641,423

1,374

1000

1100

1200

1300

1400

1500

Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11

Productivity

87 91 101 101 103 108 128 125 123

0

100

Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11

Business Per Branch

Business Per Employee

`/Mn

37


Way Ahead

• CASA drive to continue• Focus on Asset quality with the formation of specialized Credit Processing Centres for Large Corporate, Mid Corporate , SME , Retail and Agriculture.

• NPA recovery drive intensified to reduce NPAs.• To add over 300 branches and 1000 ATMs • International Operation to contribute significantly to the business – 3 New Centres to be added i.e Uganda , Canada & Botswana

38

Relationship beyond banking39

analyst presentation september 2011

Documents

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