Amid the ongoing challenges in the banking sector, the initial public offering (IPO) of CSB Bank (formerly known as Catholic Syrian Bank) lends little comfort. Kerala-based CSB Bank is one of the oldest private sector banks, with a focus on SME, gold loans and an NRI client base.
The bank moved into the black in the first half of the current fiscal, and its capital position got a boost in FY19 and this fiscal from the ₹1,200-crore investment by FIH Mauritius Investments (FIHM) — a wholly owned subsidiary of Fairfax India Holdings Corporation— at ₹140 per share.
The bank transforming into a new-age lender under the aegis of its new investor (Fairfax), streamlining its high cost structure and re-aligning business strategy can pay offover the long run, but it may still be early days to bet on a sustainable turnaround. Weak operational performance over the past three fiscals (net losses) and high regional concentration remain dampeners.
Also, while the bank’s earnings may get a fillip due to moderation in provisioning (the bank has made accelerated provisioning in the past, according to the management), additional investments in technology, branding, etc, could keep costs high, weighing on earnings.
Besides, as of September 2019, about 57 per cent of SME exposure is BBB and below rated, which needs a watch. The bank also has a notable exposure to the NBFC/ HFC (non-banking financial/ housing finance companies) sector.
هذه القصة مأخوذة من طبعة November 25, 2019 من The Hindu Business Line.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك ? تسجيل الدخول
هذه القصة مأخوذة من طبعة November 25, 2019 من The Hindu Business Line.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك? تسجيل الدخول
Covid Presents An Opportunity For India
India must attract investors exiting China post-Covid. Streamlining of project clearances and relaxation in FRBM norms will help
Did Alternative Assets Shield You From Covid-19 Volatility?
The assets closely linked to stock and debt markets could not stave off the losses
How To Put Aircraft To Bed
Preserving grounded planes, to get them up and flying at short notice, is a challenging task. Ashwini Phadnis captures the process
There Can Be No Going Back On WFH
Covid-19 has fast-forwarded the shift to ‘work from home’. However, some face-to-face connect will always be needed
UN, WHO Urged To Ensure ‘Benefit Sharing' Of Covid-Related Data
Biopharma firms should reach vaccines, medicines to poor nations at an affordable price, say civil society bodies
With No Clear Signal From Rlys, States Explore Ways To Bring Back Migrants
Quarantine centres, cross-country buses being arranged even as migrants hop on to boats, trucks and ambulances
Centre Allows All Neighbourhood Shops To Open But With Riders
Final call will be taken by local authorities; shopping complexes that draw fewer ‘outsiders’ are permitted to operate
Covid Impact Relatively Muted In India
Compared to Italy and the US, India’s rate of infection spread has been slow. This can be attributed to the strict measures in place
How Global Trade Will Fare Post-Covid
China isn’t likely to lose its pre-eminent position soon. India, for one, will need to make manufacturing globally competitive
How To Curb Harassment In The Virtual Office
Training and sensitisation are essential. Institute a strict dress code and chat etiquette to ensure professionalism during video calls
