After fund infusion of around Rs 1208 crore in two years, CSB Bank Ltd is looking to enhance controls across key business processes, strengthen the front office and internal audit to ensure improved compliance coupled with a cultural transformation to attract talent to the bank.
FIH Mauritius Investments Ltd, a Fairfax Group Company, has infused a total of Rs 1,208 crore into CSB, of which Rs 721 crore was received in the FY 2019 and the balance Rs 487 crore in the FY2020, said the bank in its annual report for the year 2019-20.
While many banks are still struggling with cost overruns and missed deadlines, resulting cost reduction pressures, CSB is employing solutions for regaining profitability at a post-crisis level. Transformations are focused on enterprise-wide efficiency and simplification, updating operating models, rolling out emerging technologies, said Madhavan Menon, Chairman of CSB Bank Ltd.
“Doing this will also require your Bank to transform its core technology, investing strategically to deliver business objectives and to circumvent the challenges of legacy systems. The Bank is transforming digitally, while mindful of cyber risks, to improve its customers’ experience, improve customer segmentation and to enhance customer economics,” he said in a letter to the shareholders.
“The bank intends to become more radical by transforming its culture in the long term. Cultural transformation that is better aligned to the interests of all the Bank’s External Stakeholders – Customers, Regulators and Investors. The Bank believes that this cultural transformation will attract talent,” he added.
The Bank’s Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) position as at March 31, 2020 stood at 245 per cent and 163.67 per cent respectively, well above the regulatory requirement of 100 per cent.
Two Wheeler Business Vertical which was established in 2018 could register a growth of 265 per cent during the fiscal year 2019-20.
While the bank was concentrating on Kerala market in the beginning, it is now expanding to other states.
Gold loan portfolio continued to be a prime driver with a growth of 28 per cent during FY 20. The corporate book saw an increase of 11 per cent, while the newly started agriculture and MFI vertical had a closing book of about Rs 158 crore as on March 31, 2020, said C VR Rajendran, managing director and CEO, CSB Bank Ltd.
The Bank will set up an NRI vertical to attract deposit from non resident Indians and plans are to open 103 branches with CASA, agriculture, gold and MSME loan focus, said the bank.