Dear Stakeholders,
This year (FY 2020-21) has been an unimaginable
year due to COVID pandemic & strict containment measures across the World.
Despite facing myriad personal and professional challenges perhaps never
encountered in over a century our employees displayed exceptional courage &
served our customers without any interruption. Many of us may have lost our
near & dear ones including several colleagues in APGVB Family. My heartfelt
condolences to all those who succumbed to COVID. The Bank took several measures
to safeguard the well-being of employees & their family members including conducting
vaccination drives.
Bank’s Performance
In this current Business environment, with prudent
decision making by the Management & precise execution by Operating Staff
Bank delivered very good results & posted a healthy growth in operating
profit, Net interest Income & Balance sheet size without compromising on
asset quality. The operating profit increased by 26.51 percent to Rs.1534.48
Crore in FY 2021 and balance sheet size by 11.2 percent to Rs.34780.91 Crore.
Net Interest Income, an indication of the difference between interest earned
and interest paid grew by 24.72% to Rs.1512.91 Crore. The Bank posted net
profit of Rs.1009.66 Crore in FY 2021 an
increase of 63.49% from Rs.617.57
Crore in FY 2020. Net Interest Margin remained healthy at 4.85% (4.73% in FY 2020).
The Bank's total Business has registered a growth
of Rs 6180.05 Crore at 16.34 % to reach Rs. 43998.71 Crore as on 31st March 2021 from Rs. 37818.66 Crore on 31st
March 2020. While deposits grew by 18.07% to Rs. 21838.48 Crore from the previous year’s level of Rs.18495.69 Crore, Credit grew
by 14.68% to Rs.22160.23 Crore from Rs.19322.97 Crore in FY 2020. The strong performance
in credit is led by growth in Gold & Housing loan portfolio. Especially
after the outbreak of COVID, as the demand for Gold loans surged, the Bank
immediately revamped the existing Gold Loan schemes to make it more convenient,
competitive & customer – friendly. Banks gold loan portfolio witnessed
Spectacular growth of 97% in FY 2021.
On the back of prudent capital planning, the
capital adequacy of the Bank improved from 16.15% in March last year to 19.27%
in March 2021. The Bank's total investment portfolio (SLR & Non SLR)
increased to Rs. 12705.68 Crore in FY 2021 compared to Rs. 11970.07 Crore in FY
2020.
Asset quality
Due to COVID induced slowdown many
of the Agencies forecasted heightened risks of increase in NPA levels for
Indian Banks. However, Governments and Regulatory agencies timely interventions
with pragmatic supportive measures coupled with normal monsoon countered the
financial stress in the system. Two such measures introduced by the Reserve
Bank of India were the moratorium & loan restructuring package, which
helped alleviate the socio-economic effects of the pandemic & supported
growth in the economy. While the moratorium allowed Customers to temporarily
suspend their loan repayments (From March to August 2020), the second eased the
burden on loan repayments upto maximum 2 years.
The loan restructuring programme was aimed at
easing the burden of monthly repayments for eligible customers who were
significantly affected by the pandemic. Eligible Customers seeking loan
restructuring were allowed to reschedule their loan repayments and were offered
lower payment structures, with extended tenors of up to 24 months.
Despite all this, the
Bank ended the year with Gross NPA level of 1.06% compared to previous year’s
1.03%. Bank being one among the top lenders catering to Agriculture activities
& Self Help Groups in all the districts being served, overall performance
under NPA was quite satisfactory. The Provision coverage ratio of the Bank
continued to be 100%.
Financial Inclusion & Customer
Convenience
Financial inclusion & Customer convenience
continues to be Bank’s priority & for this Bank has created multiple touch
points. Bank has 2251 Bank Mithras catering to the customers at their doorstep.
Due to COVID lockdown, as people are confined to their homes, Bank Mithras
played a pivotal role in extending Bank’s services to the citizens by effectively
leveraging technology. Bank’s focus on strengthening Bank Mithra channel to
extend basic Banking facilities to the citizens yielded positive results. Bank
has seen a significant jump in transactions being performed at Bank Mithra
points which also enabled customers to stay safe at their homes.
During the year, Bank also launched Doorstep
Banking facility to differently abled customers & customers aged above 70
at selected Branches. Eligible customers can now avail basic Banking services
at the comfort of their homes.
Even during these difficult times Bank has
conducted customer meets seeking their feedback & suggestions for enhancing
customer experience. Bank also conducted digital financial literacy awareness
camps & procured 9 new Mobile ATM Demo Vans during the FY (Total – 15) to
create awareness on using digital mode of banking facilities & Social
Security schemes.
During the year, in order to improve monitoring
mechanism & for enhancing customer experience Bank has opened two new
Regional Offices in Telangana State at Nagarkurnool & Bhongir. Bank also
received permission for opening one more Regional Office at Anakapalli in
Andhra Pradesh.
Technology initiatives
During the year, Bank has launched a Mobile app for
Digital on boarding of mostly new to Bank customers with Video KYC facility.
This has helped in reducing Account opening TAT with higher conversions. Bank
also received permission to provide Internet Banking with transaction rights to
the customers. In order to decongest the Branches during this pandemic time,
Bank has deployed 111 kiosk passbook printing machines in the Branches through
which customers can get their passbooks updated by themselves. In addition to
this, the Bank has developed several in-house paperless solutions for internal
correspondence & approval mechanisms as part of its green Banking
initiatives.
Due to COVID pandemic, Business continuity remained
a key challenge & by adopting a detailed Business continuity plan Bank has
ensured uninterrupted services to the customers. Further, fuelled by COVID led
pandemic, Transactions across all alternative delivery channels recorded a
significant improvement.
Way Forward
Despite severe disruption in Business operations
due to COVID-19 in the last year, Bank sustained its growth momentum by
diversifying portfolio & adopting new strategies to curtail the NPA. The
plans worked out well & this is reflected in our financial statements as of
March 2021. As uncertainty looms on the depth of COVID - II wave &
subsequent waves, I am confident that we will continue to be adaptive to the
situation as we did in the last FY by fine tuning our strategies & will
embrace the new normal. We shall continue to expand our Digital reach by
effectively leveraging new IT initiatives launched during last FY &
strengthening Bank Mitra model. I am hopeful that the Bank's consistent
performance will be continued in FY 2022 as well & the No.1 profit making
Regional Rural Bank crown will be retained.
Yours sincerely,
(K. Praveen Kumar)
Chairman