The only „Greenfield‟ private sector Bank to be set up in the last 15 years
Owner – Manager - PartnerProfessional management team with the highest ownership levels among all banks
Knowledge Banking - Key Differentiator for the Integrated product offering with „One-Bank‟ customer proposition
Unique Approach to Technology Outsourced model enhancing scalability; cutting edge features driving Retail
Consistent Financial Performance FY2009 PAT: INR 3038 million; ROA: 1.52%; ROE : 20.7%
Receive the No. 1 Emerging Markets Sustainable Bank of the Year award at the FT/IFC Sustainable Banking Awards
Received the Most Innovative Bank in India award at The New Economy Annual Banking & Finance Awards in London
Launched YES COMMUNITY, a Responsible Banking initiative across Retail branches nationally
YES BANK Summary Update
Responsible Banking @ YES BANK
Business does not operate in a vacuum
Integrating social and environmental aspects into core business strategy important for long-term growth of the Bank
Responsible Banking means adopting a People-Planet-Profit approach to doing business
Translates into a critical competitive edge for the Bank
Offers inroads to new business segments and client base
Mainstreaming sustainability using multi-stakeholder approach Operate in „Sustainability Zone‟ supporting businesses that meet economic, environmental &
social objectives Innovative financial solutions to address gamut of development issues – sustainable
livelihood, food security, climate change, public health, education, informationtechnology, biotechnology etc
Using knowledge driven approach and specialised skill sets, human resources to adaptcommercial financial services to sustainability space.
YES BANK has “leapfrogged” traditional philanthropy-based CSR to Responsible Banking finding Business Solutions to Social & Environmental Issues
“Sustainability Zone” combined economic, environmental, social benefit
Pure Philanthropy
Pu
re P
rofit
Sustainability Zone Evolution of Sustainability
Values over Value
Sustainability:
Triple Bottom
Line
New Generation
of Sustainability:
Integration and
Mainstreaming
Philanthropy focused
CSR based initiatives
Sustainability as part of business
Responsible Banking – A Differentiated Approach
Responsible Banking Framework
Responsible Banking in Action
Microfinance Institutions
Group (MIG)
YES SAMPANN
Direct Lending
Responsible Banking in Thought
YES COMMUNITY
Responsible Corporate
Citizenship (RCC)
Other Bank Divisions:
– Corporate Finance
– Corporate & Institutional Banking
– Commercial Banking
– Business Banking– Retail Branches
Alternative Energy &
Environment
SUSTAINABLE INVESTMENT BANK (SIB)Business Planning/Structuring,
M&A Advisory, Private Placement
Clean & Sustainable
Technologies
Deal Generation
Internal Engagemen
t
Deal Generation
South Asia Clean Energy
Fund
MICROFINANCE Credit + Services
RESPONSIBLE BANKING (CSR & Sustainability)
Thought Leadership, Advisory, Institutionalization
SOCIALLY RESPONSIBLE
INVESTING Growth Capital
AGRIBUSINESS, RURAL & SOCIAL BANKING (ASRB)
Credit + Services
TatvaInvestment Program
Social Enterprises
FINANCIAL INCLUSION BANKING
Credit, Savings, Remittances
BusinessCorrespondent
Deal Generation
Responsible Banking: Mainstreaming sustainability principles across YES BANK
A “Think Tank” incubating new business opportunities to mainstream sustainability
Provides thought leadership
Establishes partnerships for development - local and international
Supports the socially responsible investor community by innovating
business approaches to development.
Provides Responsible Corporate Citizenship advisory services to businesses, governments and non-profits for
Social Auditing
Strategizing CSR practices
Socio-environmental engagement
Waste management
Human capital and employee support analysis
Carbon emissions analysis
Social enterprise planning and scalability
Entrepreneurship development and syndication of funds
Responsible Banking „in Thought‟
Agribusiness, Rural & Social Banking
Innovative financial models
Leveraging outreach of stakeholder in Agri Value Chain to overcome „last mile‟ issues
Customized insurance solutions
Select Partners:
Reaching over 1 million Farmers through these Partnerships
Zameen Organic Pvt. Ltd Fair trade supported company owned by Small Farmers‟
Organizations
Network of 6,000 small farmers producing organic cotton in the Vidharbha (Maharashtra) and Adilabad (Andhra Pradesh) regions
Provides vital processing and marketing linkage between organic farmers and branding companies
Unique concept of Premium: Farmer Premium and Community Premium
Financing Innovative AgribusinessDeal Example
YES BANK is Zameen‟s Sole Banking Partner
Programme Approach About the Programme
Microfinance Institutions Group (MIG)
Wholesale – Credit partnership with leading Indian MFIs across the country
MIG's product suite includes term loans, loan syndications and rated capital market loan products
Mainstreams microfinance by providing access to capital markets that reduce the cost of funds and operations resulting in affordable financial products for the BOP
YES SAMPANN
Direct Intervention –Lending directly to BOP clients in urban and rural locations
Servicing bottom of the pyramid through a gamut of financial products and services
Fills gap of institutionally sponsored financial services provider servicing needs of low income communities in rural and urban India
MicrofinanceComplementary Two Pronged Approach
Growing Partnerships and Programs to Financially Include 1000‟s
Institutes specific transactions to position microfinance as a new assetclass, appealing to a broad base of investors and lenders, expanding access tocapital
FIRST Indian bank to undertake innovations in capital market products formicrofinance:
• Capital Market Products
Banks have been main source of debt funding for MFIs (term loans)
Term loans are relatively expensive they are illiquid
YES BANK arranged first rated bond issuance of an MFI in the world inthe form of Commercial Paper & Non-Convertible Debentures of INR2000 mn (USD 40 mn)
Enabled cost reduction for the MFI to the extent of 300 bps
• Structured Products
Securitisation of receivables originated by MFI
MFI receivables recognised as an „asset class‟
Generated interest among institutional investorsPotential incremental access to capital for industry of USD 12-14bn
annually, impacting 60-70mn clients
Microfinance Institutions GroupMultiplier Effect: The Indirect Impact
Sameer started a Ceramic & Glassware business 5 yrs ago in Chembur.
Presently in his 2nd Loan Cycle1st Loan: Rs 25,000 for 5 months2nd Loan: Rs 37,000 for 8 months
Repayment: Weekly (1st loan) / Fortnightly (2nd
loan)
Has used the Loan for Sourcing additional stock from Firozabad & increasing inventory. Earlier, faced problems of stock shortage due to lack of capital
Monthly Household Surplus: Rs 13,318
Wants to expand his business on the wholesale side and stock other ceramic material apart from mugs, glasses & cups
I hope to grow my business with YES SAMPANN‟s support – it feels like home, I don‟t have to anywhere else to fulfill my financial needs
Sameer Khan, 28 yrsMarried, has 3 yr. old son
A YES SAMPANNite
Supporting EntrepreneursOne person at a time
M&A Advisory
JV Advisory
Business Restructuring
Private Equity Raising
Sustainable Investment Banking (SIB)
M&A Advisory
Business Restructuring
Private Equity Raising
56% of the 700 million rural Indian residents lackaccess to electric power; Government wants todeliver electricity to all of them by 2012 – 50% of itfrom renewable resources (wind, power, solar &biogas)*
YBL focused on addressing India‟s energydeficiency & reducing reliance on fossil fuelsthrough thrust on renewable energy
Raised USD 47 mn for Greenko, a renewableenergy player, through private placement ofequity shares with Global Environment Fund, oneof the world‟s largest environment focusedfunds, for expansion of their hydro powergeneration assets
*Source: Pernick, R. & Wilder, C (2007) ‘The Clean Tech Revolution’, Harper Collins
Renewable EnergyDeal Example
• Promoting funds
• Buy-Side advisory services to global “Financial Sponsors”
• Tailor made investment advise based on sector focus, investment size of the fund, having India in the geographic focus
• Focused on building proprietary deal pipeline for the fund
• Current Mandate - Exclusive India Advisor for U.S.-based GEF‟s Emerging Markets fund for clean energy and environment investments in India.
Socially Responsible Investing
Key Highlights – South Asia Clean Energy Fund (SACEF)
Commitment period – 5 years
GEF and YBLFund Sponsor
Remaining life – 5 years with two 1 year extension periods
Fund Life
USD 2.0 millionMinimum Investor Commitment
10% in a single portfolio companyInvestment Cap
USD 3.0 - 15 millionSize of Investment
USD 200 millionSize of Fund
TERI-YES BANK LaBL Financing Program
Objectives of the program:
• Research and survey exisiting LaBL sites to uncover best practices, lapses, socio economic conditions, availability of lighting fuel etc.
• Develop 2-3 semi-commercial models for the LaBL campaign
• Pilot the commercial models through grant funding to assess viability over a 2-3 month period
• Finalize the models and co-fund scale up with other commercial banks and financial institutions
TERI-YES BANK LaBL Financing Program
Key Findings –
– Entrepreneurs with other lucrative business interests are not fully committed to making model successful in their village
– Entrepreneur‟s reputation and standing in the village determines the SLCS models success
– Villagers typically spend INR 100-150 per month on lighting
– Entrepreneurs are charging INR 3.5 on average for renting the lanterns for 1 night
– 90% of respondents still rely on kerosene lanterns for their alternative lighting needs
– Electricity theft is high in those villages where state allocates electricity for agricultural needs
– Mobile phone usage in rural India is extremely high. This unlocks the possibility of entrepreneur earning
Financing options currently being explored:
• Microfinance loan to SLCS entrepreneurs/SHG –– Backed by FD from TERI and/or LaBL Partner– Disbursement and relationship on ground to be managed by partner MFI– Payback period typically 12-18 months
• School financing model– Lending to schools with an entrepreneurial bent of mind– Model enables school children to take home a lantern after school – Rent for lantern is added onto school fees
• Community financing– Entrepreneur collects refundable deposits from community– Community deposits parked at MFI– Bank lends to entrepreneur against community deposit
TERI-YES BANK LaBL Financing Program
TERI-YES BANK LaBL Financing Program
Benefits of commercialization of clean lighting models:
• Gradual shift away from grant and subsidy model for greater scalability
• Creates accountability amongst stakeholders – entrepreneur, user,
• Generate a profit and loss/balance sheet track record for models and attract PE and Institutional investment in the future
• Create interest from commercial banking and finance community in investing in small and large scale clean lighting ventures
Successfully Positioned
Emerging Markets Sustainable Bank of the Year for Asia2008 for excellence in creating environmental, social andfinancial value across its operations.
Best Corporate Social Responsibility Practice Award, Socialand Corporate Governance Awards, 2007, in recognition ofinnovative strategies to implement CSR practices within thebusiness focus of the Indian Corporate sector.
Trade Finance „Deal of The Year‟, 2007 in recognition ofinnovative structured rural financing solutions.
Environment Leadership Award, in recognition ofoutstanding contributions made through working inpartnerships to improve the environment and quality of lifefor the people of Asia.
The first bank to be recognized by the CII-ITC SustainabilityAwards in 2009