Company Analysis of Citizens Bank International Ltd.sharesansar.com/webroot/ipo pdf/citizens bank international ltd..pdf · 2015 Sharesansar.com 5/5/2015 Company Analysis of Citizens

2015

Sharesansar.com

5/5/2015

Company Analysis of Citizens Bank International Ltd.

Table of Contents 1.0 Company Analysis ................................................................................................................................... 1

1.1Overview .............................................................................................................................................. 1

1.2 BOD ..................................................................................................................................................... 2

1.2 CEO’s Profile: ....................................................................................................................................... 6

1.3 Management Team ............................................................................................................................. 1

1.4 Network .............................................................................................................................................. 2

1.5 Products and Services ......................................................................................................................... 1

2.0 Analysis ................................................................................................................................................... 2

2.1 Capital Structure ................................................................................................................................. 2

2.2 Balance Sheet ...................................................................................................................................... 4

2.3 Profit & Loss Account .......................................................................................................................... 9

2.4 Key Ratios .......................................................................................................................................... 19

3.0 Analysis ................................................................................................................................................. 26

3.1 Fundamental Analysis ....................................................................................................................... 26

Sharesansar.com | 1.0 Company Analysis 1

1.0 Company Analysis

1.1Overview

Citizen bank is one of the leading commercial bank which is entirely managed by Nepalese professionals and owned by the general public.

This bank started its operation in 21st June, 2007. It has 47 branches in Nepal and also provides Branchless Banking services.

The bank has started its Branchless Banking operation from Jestha 30, 2069 at Matiyani of Mahottari District.

The Bank has acquired Nepal Housing & Merchant Finance Ltd. and Peoples Finance Ltd. The acquisition was approved by NRB on 12/26/2071. The bank has begun joint operations from May 8th, 2015.


1.2 BOD

This bank has 8 members in its BOD.

Mr. Pradeep Jung Pandey, Chairman

Mr. Pradeep Jung Pandey is one of the leading industrialists. His area of activities are manufacturing of

pharmaceutical products, Ayurvedic products and cement along with insurance, investment and trading.

He is associated with various social organizations such as Rotary Club, Nepal Blind Association etc. He is

the President of FNCCI.

Mr. Bal Krishna Prasai, Professional Director

Mr. Bal Krishna Prasai, former Secretary of the Government of Nepal, has successfully served for 25

years in various important capacities under different Ministries of the Government of Nepal. Mr Prasai

has acquired wide experience in the field of development and governance (including financial) .He holds

Master Degree in Business Administration from the Phillipines and Master Degree in Science from

Nepal.


Mr. Manohar Das Mool, Director

Mr. Manohar Das Mool is one of the leading businessmen of the country with excellent track record

since 1980. His main business is paper business and is also associated with various organizations such as

Paper Merchants Association of Nepal, Nepal Stationery Manufacturer's Association, Rotary Club of

Kantipur, All Nepal Lawn Tennis Association etc. Mr. Mool has acquired numerous entrepreneurship

trainings in different countries. He has an excellent academic track record.

Mr.Prakash Chandra Mainali, Public Director

Mr. Mainali is an experienced businessman. He is mainly related with the business sectors like service

industry, poultry and other industries. He had also worked in a Joint venture bank for 9 years prior to

commencing his own business ventures.


Mr. Abinash Pant, Director

Mr. Abinash Pant is a young and promising entrepreneur, who is managing a bunch of companies in the

capacity of Managing Director and Partner since 2005. His area of activities are manufacturing of seeds

& organic fertilizers along with Phyto-chemicals. Mr. Pant has served as Board of Directors for Nepal

Telecommunications Authority from 2002 to 2007. He has also served as Project Director in several

projects undertaken by Consolidated Management Services Nepal, funded by ADB, World Bank & IFAD.

He has also served for Nepal Government in the capacity of Accounts Officer from 1983 to 1991. Since

1993 till date, he has been serving Consolidated Management Services Nepal (P) Ltd., a consulting

company in the capacity of Board of Directors.

Mr.Pavitra Kumar Karki, Director

Mr. Pravitra Kumar Karki is an enthusiastic professional who has been working in various positions in the

Travel & Tours Trade. Mr. Karki has been in this industry for more than 26 years and has served in

various positions for Nepal Association of Tour & Travels from 1995 to 2010. He has also been serving in

various positions for United Federation of Travel Agents from 2006 to 2010. Besides the Travel and

Tours Trade he is also involved in the power and energy generating industries in the capacity of

Chairman and Chief Executive Officer.


Mr.Arjun Lal Rajbanshi, Director

Mr. Arjun Lal Rajbanshi is a hard working professional who has an experience of more than 24 years in

the field of Issue Management & Capital markets Development, Administration management, System

Design, Programming & Implementation and Finance control & management for various groups and

industries. He is currently the Chief Manager in Citizen Investment Trust and is responsible for the

system designing, programming and implementation.

Mr.Bijaya Dhoj Karki, Public Director

Mr. Bijaya Dhoj Karki successfully served for 37 years in the Nepal Army and retired in the post of

Brigadier General. During the service period Mr. Karki visited all 75 districts of the country. He also

served under the UN Mission in former Yugoslavia, Haiti, Lebanon, Congo etc. Mr. Karki also attended

the Crisis Management Training at Israel. Mr. Karki is an Honorary Member of the Barphedi Society.


1.2 CEO’s Profile:

Mr. Rajan Singh Bhandari, Chief Executive Officer

Mr. Rajan Singh Bhandari, is a Chartered Accountant from Institute of Chartered Accountants of India

(ICAI) and M.A (Economics) from Tribhuvan University.

He served in the Nepal Rastra Bank for 26 years (June 1980 to December 2006) and headed various

departments such as Banking Regulation, Bank Supervision, Kathmandu Banking Office, Accounts, and

Internal Audit.

He was also responsible in formulating and introducing various prudential norms and directives in the

history of Nepalese Banking System.

He was also a past president of Nepal's Bankers Association.

Mr. Rajan Singh Bhandari was involved in an irregularity in the second financial secor restructuring

project of NRB. He was later deemed innocent by the World Bank.


1.3 Management Team

S.N NAME POSITION

1 Mr. Rajan Singh Bhandari Chief Executive Officer

2 Mr. Ganesh Raj Pokhrel Deputy Chief Executive Officer

3 Mr. Bodh Raj Devkota Assistant Chief Executive Officer

4 Mr. Ramdhan Shrestha Assistant Chief Executive Officer

5 Mr. Samir Prasad Dahal Chief Finance Officer

6 Mr. Rajendra Lal Shrestha Chief Risk And Recovery Officer

7 Mr. Paras Kumar Kafle Chief Operating Officer

8 Mr. Umang Sharma Chief Administrative Officer

9 Mr. Sumit Babu Khatri Chief Credit Officer

10 Mr. Sanjeeb Kumar Shrestha Chief information Technology Officer

11 Mr. Suman Mulepati Head consumer banking unit including fast track loan

12 Mr. Amit Khanal Head credit risk department

13 Mr. Narayan Raj Adhikari Head credit risk department

14 Ms. Manisha Karna Head recovery department

15 Mr. Roshan Manandhar Operation in-charge operation department

16 Mr. Pramesh Raj Kayestha Executive Finance Officer-Finance Department

17 Mr. Anit Sapkota Head-Internal Audit Department

18 Mr. Suresh Prasad Thapaliya Head -Trade Administration Department

19 Mr. Suresh Kumar Poudel Head -Card Department

20 Mr. Saurav Tiwari Head Compliance and NRB Reporting

21 Mr. Bhupendra Bista Head -General Service Department

22 Mr. Angish Shrestha Head treasury front office/agency department

23 Mr. Hari Babu Thapa Head -Credit Administration Department

24 Mr. Krishna Pandey Head-Risk Management Department

25 Mr. Macharaj Maharjan Head-IT

26 Mr. Shyam Prasad Lamichane Head -Remittance

27 Mr. Bandana Pandey New Product And Transaction Banking Department


1.4 Network

The bank has 48 branches, 42 ATMs (20 inside the valley and 22 outside the valley) and 21 Branchless

Banking Operations (BLB). The bank has 18 branches inside Kathmandu valley and 30 branches outside

Kathmandu valley.

INSIDE VALLEY OUTSIDE VALLEY

Corporate Office/Kamaladi Branch Birtamod branch

Boudha branch Biratnagar branch

Koteswar branch Itahari branch

Kapan branch Gaighat branch

Kalanki branch Charikot branch

Narayan Gopal chowk Hetauda branch

Maitidevi Chowk Janakpur branch

Thahity chowk Nijgadh branch

Naya bazar branch Kolhabi branch

Newroad branch Birgunj branch

Kirtipur branch Payhailaiya branch

Kumaripati branch Narayanghat branch

Patandhoka branch Butwal branch

Bhaktapur branch Siddharthnagar branch

Thimi branch Baglung branch

Samakoshi branch Pokhara branch

Thapathali branch Beni branch

Gorahi branch

Nepalgunj branch

Surkhet branch

Dolpa branch

Dhangadi branch

Mahendranagar branch

Jajarkot branch

Jumla branch

Dharan branch

Simikot branch

Bajhang branch

Bhojpur branch


1.5 Products and Services S.N. Deposits Interest rate (% p.a.)

1 Citizen Sharedhani Bachat Khata(CSBK) 3

2 Senior Citizen Saving 1.5

3 Citizens Matribhumi Bachat 3

4 Citizens Mahila Bachat 2

5 Citizens Muna Bachat 2

6 Citizens Recurring Deposit 4%, 3 years

4.25%, 5 years

4.5%, 7 years

7 Citizens ZERO Balance Account 1.5

8 Citizens Rastrasewak Saving 1.5

9 Citizens Bidhyarthi Bachat 1.5

10 Citizens Special Savings 1.5

11 Dashain Tihar Muddapi Nichhep Yojana 5.5

12 Citizens Super Savings Account 2

13 Citizens Special super Saving 4

14 OTHER SAVINGS

37%

63%

Branch Locations

Inside Kathamandu valley

Outside Kathmandu valley48

42

21

Branches ATM Locations BranchlessBanking Locations

Network

S.N LOANS AND ADVANCES Interest rate (% p.a.)

1 Term Loan 11.5%-14%

2 Overdraft 11%-14%

3 Working Capital Loan 11%-13%

4 Trust Receipt Loan 10%-12.5%

5 Export Finance 10%-13%

6 Auto Loan 9%-15%

7 Home Loan 9%-14%

8 Mortgage Loan 10%-14%

9 education loan 11%-12%

Sharesansar.com | 2.0 Analysis 2

2.0 Analysis

2.1 Capital Structure

Authorized, Issued and Paid-up Capital:

Particulars 2013-14 (millions)

2012-13 (millions)

Change %

Authorized Capital

5000 5000 0%

Issued Capital 2101.84 3000 -29.94%

Paid-up Capital 2375.08 2101.84 13%

The bank has an authorized capital of Rs. 5000 million. The issued capital and paid up capital of the bank

is currently Rs. 2101.84 million and Rs. 2375.08 million respectively. The company will increase its issued

capital to accommodate the increased paid-up capital in the next AGM. The Paid up capital has

increased by 13% in comparison to last year.

Share Ownership Details:

Share ownership 2013-14 2012-13

Domestic Ownership 100% 100%

Public 49% 30%

Promoters 51% 70%

Foreign Ownership 0 0

Total 100% 100%

49% 51%

Share Ownership Details (2013-14)

Public Promoters

Sharesansar.com | 3

Shareholders holding 0.5% or more of the total shares:

S.n Name Number of Shares Held

% Of shareholding

1 Janak Bista 1036728 4.93%

2 Citizen Investment Trust 1027707 4.89%

3 Urmila Pandey 1009018 4.80%

4 Sabutri Sharma 576939 2.74%

5 Bijen Joshi 525530 2.50%

6 Manohar Das Mool 423052 2.01%

7 Pabitra Kumar Karki 394147 1.88%

8 Rabindra Man Singh Pradhan 394147 1.88%

9 Soni Joshi 394147 1.88%

10 Ramesh Sharma 229732 1.09%

11 Shanker Prasad Sharma 229732 1.09%

12 SR Hydro And Investment Pvt.Ltd 219555 1.04%

13 Narendra Kumar Dev Bhatta 153154 0.73%

14 Sulochan Raj Rajbhandari 153154 0.73%

15 Anil Kumar Dhungel 153118 0.73%

16 Arjun prasad Sharma 153118 0.73%

17 Jagannath Gyawali 153086 0.73%

18 Prem Bahadur Shrestha 152604 0.73%

19 Anin Rajbhandari 149017 0.71%

20 NLG insurance Co.Ltd 145714 0.69%

21 Badri Kumar Shrestha 143582 0.68%

22 Dhruba Kumar Shrestha 143582 0.68%

23 Urmila Shrestha 135924 0.65%

24 Pratap Jung Pandey 132096 0.63%

25 Shrawan Kumar Rana 131382 0.63%

26 Manita Bhattarai 130181 0.62%

27 Ramita Bhattarai 130181 0.62%

28 Parameshwor Prasad Rauniyar 119453 0.57%

29 Usha Kiran Shrestha 115141 0.55%

30 Pradeep Kumar Shrestha 115069 0.55%

31 Babu Ram Pokhrel 114866 0.55%

32 Rajesh Khadka 114866 0.55%

33 Ram Prasad Shrestha 114789 0.55%

34 Rajendra Kayastha 110655 0.53%

35 Sandhya Regmi Shiwakoti 108089 0.51%

36 Chintamani Bhattarai 107208 0.51%

37 Anu Gyawali Pangeni 105200 0.5%

Sharesansar.com | 4

2.2 Balance Sheet Share capital and Reserve & Surplus:

Shows the amount of share capital, the amount it has as reserve and surplus and the overall size of its

balance sheet.

Annual:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Share Capital 2375.08 13.00% 2101.84 2101.84 2040.00 1206.95

Reserve & Surplus 377.73 35.93% 277.89 179.92 132.12 101.32

Total Equity 2752.81 15.68% 2379.73 2281.76 2172.12 1308.27

Debenture & Bonds 500.00 0 0 0 0

Total Assets 32221.62 24.03% 25979.51 20068.51 16815.04 16516.88

Quarterly:

Q3 2014 (millions)

Change % Q3 2013 (millions)

Q2 2014 (millions)

Q1 2014 (millions)

Share Capital 2379.54 13.21% 2101.84 2379.54 2379.54

Reserve & Surplus 835.62 43.59% 581.94 657.61 488.08

Total Equity 3215.16 19.80% 2683.78 3037.15 2867.62

Total Assets 40672.29 36.43% 29811.07 36531.82 34453.43

0

500

1000

1500

2000

2500

3000

3500

Mill

ion

Rs.

Shareholders Equity

Reserve & Surplus

Share Capital

Sharesansar.com | 5

Deposits and Investments:

Shows the deposit amount the bank has collected from the general public and the amount it has

mobilized as Investments and Loans & Advances.

Annual:

2013-2014 (millions)

Change %

2012-13 (millions)




Deposit Liability

27963.45 22.95% 22743.10 17354.53 13478.33 14214.48

Investments 2710.41 -0.35% 2719.99 1529.90 2401.44 2608.17

Loans and Advances

22485.42 28.03% 17561.95 14129.60 12271.83 10785.66

0

500

1000

1500

2000

2500

3000

3500

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Shareholders Equity

Reserve & Surplus

Share Capital

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Total Assets

Sharesansar.com | 6

Quarterly:

Q3 2014 (millions)


Q2 2014 (millions)

Q1 2014 (millions)

Deposit Liability

34799.65 38.95% 25044.22 30918.05 29609.04

Investments 3862.89 43.23% 2696.91 4324.14 3915.42

Loan and Advances

28740.52 32.02% 21770.48 26556.08 24972.05

0

5000

10000

15000

20000

25000

30000

35000

40000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Deposit Liability

0

5000

10000

15000

20000

25000

30000

35000

40000

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Deposit Liability

Sharesansar.com | 7

0

5000

10000

15000

20000

25000

30000

35000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Use of Funds

Investments

Loans and Advances

0

5000

10000

15000

20000

25000

30000

35000

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Use of Funds

Investments

Loans and Advances

Sharesansar.com | 8

0

2000

4000

6000

8000

10000

12000

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Loans and Advances Breakdown

Realstate Loan

Home/Housing Loan (personal homeloan upto 60 lacs or less)#

Margin Type loan

Term Loan

Overdraft Loan/TR Loan/ WC Loan

Others

12% 6%

3%

20%

38%

21%

Loans and Advances Breakdown of Q3 2014

Real Estate loan

Home/Housing Loan (personalhome loan upto 60 lacs or less)

Margin Type loan

Term Loan

Overdraft Loan/TR Loan/ WCLoan

Others

Sharesansar.com | 9

2.3 Profit & Loss Account

Interest Income and Interest Expenses:

Shows the amount of interest income and interest expenses of the company. Interest income is the

primary source of income of a bank and interest expense its primary expenditure.

Annual:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Interest Income 2455.75 11.02% 2211.98 1980.32 1795.23 1398.83

Interest Expenses 1382.63 17.48% 1176.91 1405.86 1236.32 950.90

Net Interest Income 1073.13 3.68% 1035.07 574.46 558.91 447.93

Quarterly:

Q3 2014 (millions)

Change % Q3 2013 Q2 2014 (millions)

Q1 2014 (millions)

Interest Income

1991.54 10.68% 1800.75 1302.29 649.03

Interest Expenses

1047.09 2.14% 1025.14 686.78 348.40

Net Interest Income

944.45 21.77% 775.61 615.52 300.63

0

500

1000

1500

2000

2500

3000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Interest Income & Expenses

Interest Income

Interest Expenses

Net Interest Income

Sharesansar.com | 10

Operating Income:

Shows the total income generated by the bank from its regular operations.

Annual:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Total Operating Income

2796.69 13.96% 2454.07 2115.70 1906.17 1507.08

Quarterly:

Q3 2014 (millions)


Q2 2014 (millions)

Q1 2014 (millions)


1192.53 18.66% 1004.99 789.16 386.66

0

500

1000

1500

2000

2500

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.


Interest Income

Interest Expenses

Net Interest Income


Operating Income Breakdown:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Interest Income 2455.75 11.02% 2211.98 1980.32 1795.23 1398.83

Commission & Discount

54.74 4.13% 52.57 40.36 32.53 25.13

Other Operating Income

206.17 53.36% 134.44 71.93 65.12 67.85

Exchange Fluctuation Income

80.03 45.30% 55.08 23.09 13.28 15.28

0

500

1000

1500

2000

2500

3000

3500

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.



0

200

400

600

800

1000

1200

1400

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.



Q3 2014 (millions)


Q2 2014 (millions)

Q1 2014 (millions)

Interest Income 1991.54 10.60% 1800.75 1302.29 649.03

Commission & Discount 45.30 -1.93% 46.19 41.38 25.84

Other Operating Income 140.72 34.68% 104.49 95.77 45.25


62.06 -21.15% 78.71 36.49 14.94

0

500

1000

1500

2000

2500

3000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Interest Income Breakdown

Interest Income




0.00

500.00

1000.00

1500.00

2000.00

2500.00

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Interest Income Breakdown

Interest Income





Operating Expenses:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Total Operating Expenses

2381.77 26.25% 1886.54 1850.22 1600.53 1203.12

Q3 2014 (millions)


Q2 2014 (millions)

Q1 2014 (millions)


625.12 3.19% 605.82 444.01 220.78

0

500

1000

1500

2000

2500

3000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.




Operating Expenses Breakdown:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Interest Expenses 1382.63 17.48% 1176.91 1405.86 1236.32 950.90

Staff Expenses 165.57 14.63% 144.44 108.81 81.69 63.67

Other Operating Expenses

268.86 9.60% 245.30 212.72 179.15 131.43

Exchange Fluctuation Loss

4195.53 -84.97% 27908.09 n/a n/a n/a

Loan Loss Provision 560.52 91.97% 291.99 122.82 103.37 57.12

Q3 2014 (millions)


Q2 2014 (millions)

Q1 2014 (millions)

Interest Expenses 1047.09 2.14% 1025.14 686.78 348.40

Staff Expenses 164.32 38.89% 118.32 108.15 53.99


215.26 16.51% 184.76 141.14 70.06

Loan Loss Provision 245.54 -18.90% 302.75 194.72 96.72

0

100

200

300

400

500

600

700

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.



0

200

400

600

800

1000

1200

1400

1600

2009-10 2010-11 2011-12 2012-13 2013-14

Mill

ion

Rs.

Operating Expenses Breakdown

Interest Expenses

Staff Expenses


Loan Loss Provision

0

200

400

600

800

1000

1200

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Operating Expenses Breakdown

Interest Expenses

Staff Expenses


Loan Loss Provision


Operating Profit and Net Profit:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Operating Profit 414.92 -26.89% 567.52 265.48 305.64 303.97

Net Profit 498.09 20.53% 413.25 224.79 198.35 193.56

Q3 2014 (millions)


Q2 2014 (millions)

Q1 2014 (millions)

Operating Profit 567.41 42.15% 399.18 345.15 165.88

Net Profit 457.88 50.59% 304.06 279.87 110.35

0

100

200

300

400

500

600

2009-10 2010-11 2011-12 2012-13 2013-14

Mill

ion

Rs.

Operating and Net Profit

Operating Profit

Net Profit

0

100

200

300

400

500

600

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.


Operating Profit

Net Profit


Loan Loss Provision:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Loan Loss Provision

560.52 91.97% 291.99 122.82 103.37 57.12

Q3 2014 (millions)


Q2 2014 (millions)

Q1 2014 (millions)

Loan Loss Provision 245.54 -18.90% 302.75 194.72 96.72

0

100

200

300

400

500

600

2009-10 2010-11 2011-12 2012-13 2013-14

Mill

ion

Rs.

Loan Loss Provision

0.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Loan Loss Provision


Write Back of Provision:

2013-14 (millions)

Change %

2012-13 (millions)

2011-12 (millions)

2010-11 (millions)

2009-10 (millions)

Write Back of Provisions

316.12 140.94% 131.20 79.44

n/a n/a

Q3 2014 (millions)


Q2 2014 (millions)

Write Back of Provision 124.50 92.75% 64.59 71.55

0

50

100

150

200

250

300

350

2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Write Back of Provision

0

20

40

60

80

100

120

140

Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Write Back of Provision


Dividend History:

2013-14 (%)

Change %

2012-13 (%)

2011-12 (%)

2010-11 (%)

2009-10 (%)

Cash Dividend 5.95 -60.33% 15 8.42 5.53 12.63

Bonus Shares 13 0 0 5 0

Total Dividend 18.95 26.33% 15 8.42 10.53 12.63

2.4 Key Ratios

EPS:

2013-14 Change %

2012-13 2011-12 2010-11 2009-10

Earning Per Share

23.70 20.55% 19.66 10.70 9.92 19.36

Q3 2014 Change % Q3 2013 Q2 2014 Q1 2014

Earning Per Share 19.24 33.02% 14.47 11.76 4.64

Earning Per Share (annualized)

25.66 33.05% 19.29 23.52 18.55

0

2

4

6

8

10

12

14

16

18

20

2009-10 2010-11 2011-12 2012-13 2013-14

Dividend History

Bonus Shares (%)

Cash Div (%)


P/E ratio:

2013-14 2012-13 2011-12 2010-11 2009-10

P/E ratio 22.74 13.58 21.5 22.38 25.36

Market Value per Share:

Q3 2014

Q3 2013

Q2 2014

Q1 2014

2013-14 2012-13 2011-12 2010-11 2009-10

Market Value per Share

448 267 431 453 539 267 230 222 491

0

5

10

15

20

25

30

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014annulized

Rs.

EPS

EPS

25.36 22.38

21.5

13.58

22.74

17.46

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

P/E Ratio

P/E Ratio


CD Ratio:

Q3 2014

Q2 2014

Q1 2014

2013-14 2012-13 2011-12 2010-11 2009-10

CD ratio 75.75% 78.77% 76.61% 82.87% 78.97% 83.06% 92.85% 76.86%

0

100

200

300

400

500

600

Rs.

Market Value

Market Value

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

%

CD ratio

CD ratio


Capital to RWA ratio:

2013-14 (%)

2012-13 (%)

2011-12 (%)

2010-11 (%)

2009-10 (%)

Core Capital 10.26 11.05 13.57 14.69 10.51

Supplementary Capital

2.73 0.84 0.9 0.85 0.89

Total Capital Fund

12.99 11.89 14.47 15.53 11.40

Book Net worth:

2013-14 Change % 2012-13 2011-12 2010-11 2009-10

Total Net worth 2753.41 million

15.93% 2375.08 million

2291 million

2172.12 million

1308.27 million

Net worth per share

131 15.93% 113 109 108.61 130.83

Q3 2014 Change % Q3 2013 Q2 2014 Q1 2014

Total Net worth

3215.16 19.80% 2683.78 3037.15 2867.62

Net worth per Share

135.12 5.82% 127.69 127.64 120.51

0

2

4

6

8

10

12

14

16

18

2009-10 2010-11 2011-12 2012-13 2013-14

%

Capital to RWA ratio

Core Capital


Tota Capital Fund


Non-performing Loans:

2013-14 (%)

Change % 2012-13 (%)

2011-12 (%)

2010-11 (%)

2009-10 (%)

Non-performing Loans to Total Loan

3.40% 69.15% 2.01 2.01 1.17 0.31

Q3 2014 (%)

Change % Q3 2013 (%)

Q2 2014 (%)

Q1 2014 (%)

Non-performing Loans to Total Loan

1.79 -25.10% 2.39 2.01 2.35

0

20

40

60

80

100

120

140

160

Rs.

Networth per share

Networth per share


Return on Equity:

2013-14 (%)

Change % 2012-13 (%)

2011-12 (%)

2010-11 (%)

2009-10 (%)

Return on Equity

18.09% 4.2% 17.37% 9.85% 9.13% 14.80%

Q3 2014 Change % Q3 2013 Q2 2014 Q1 2014

Return on Equity (annualized)

18.99% 25.70% 15.11% 18.43% 15.39%

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

NPL to Total Loans

0.00%

5.00%

10.00%

15.00%

20.00%

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014(annualized)

Return on Equity


Return on Assets:

2013-14 (%)

Change % 2012-13 (%)

2011-12 (%)

2010-11 (%)

2009-10 (%)

Return on Assets

1.55% -2.82% 1.59% 1.12% 1.18% 1.17%

Q3 2014 Change % Q2 2014 Q1 2014 2013-14

Return on Assets (annualized)

1.50% 10.38% 1.36% 1.53% `1.28%

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

1.60%

1.80%

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Return on Assets


3.0 Analysis

3.1 Fundamental Analysis Interest Income and expenses:

The interest income is in an increasing trend as has been shown by the increase from Rs.1398.83 million

in 2009-10 to Rs. 2455.75 million in 2013-14. The interest expenses were increasing till 2011-12. It

increased from Rs. 950.9 million in 2009-10 to Rs. 1405.86 million in 2011-12. But it decreased to Rs.

1176.91 Million in 2012-13 which is a drop of 16.29%. The interest expenses for the year 2013-14 was

Rs. 1382.63 million.

The interest income and interest expenses during the period between 2009-10 to 2013-14 increased

year on year by 15.11% and 9.81% respectively.

0

500

1000

1500

2000

2500

3000

2009-10 2010-11 2011-12 2012-13 2013-14

Mill

ion

Rs.

Interest Income

Interest Expenses

0

500

1000

1500

2000

2500

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.


Interest Income

Interest Expenses

Net Interest Income


The quarterly analysis of the company shows that its interest income has increased from Rs.1302.29

million in Q2 2014 to Rs.1991.54 million in Q3 2014. The interest income in Q3 2014 was Rs.1800.75

million. The interest income in Q3 2014 is 52.93% higher than in Q2 2014 and 10.60% higher than in Q3

2013.

While the interest income has increased by 10.6% compared to same quarter last year, the interest

expense has only increased by 2%.

Deposit and Loans & Advances:

The deposit collection by the bank has been increasing throughout our review period. In FY 2009-10, the

bank collected Rs.14214.48 million in deposits. Although the deposit collection dropped to Rs.13478.33

million in 2010-11, it has been increasing ever since and stands at Rs.27963.46 million as of FY 2013-14.

0

5000

10000

15000

20000

25000

30000

35000

40000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Deposit Liability

0

5000

10000

15000

20000

25000

30000

35000

40000

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Deposit Liability


This is a year on year growth of 18.43%. As of Q3 2014, the bank has already surpassed its FY 2013-14

figure by Rs.6836.18 million. Compared to Q3 2013, the bank’s deposit collection has increased by an

impressive 38.95%.

As of Q3 2014, the bank has mobilized Rs.28740.52 million as Loans & Advances and Rs.3862.89 million

as Investments. The bank has mobilized 12% of the total loans and advances in Real Estate Loans, 6% in

Home/Housing Loans, 3% in Margin Type Loans, 20% in Term Loans, 38% in Overdraft Loans and 21% in

other sectors.

0

5000

10000

15000

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25000

30000

35000

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Use of Funds

Investments

Loans and Advances

0

5000

10000

15000

20000

25000

30000

35000

Q1 2014 Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Use of Funds

Investments

Loans and Advances


Operating Profit and Net Profit:

The operating profit of the bank has increased from Rs.303.97 million in 2009-10 to Rs.414.92 million in

2013-14. The operating profits fell in 2011-12 and 2013-14. The highest operating profit of the bank was

Rs.567.52 million which was achieved in 2013-14. The operating profit then dropped by 26.89% or 152.6

million to Rs. 414.92 million in 2013-14. As of Q3 2014, the operating profit has improved significantly

and reached Rs. 567.41 million which is an increase of 36.75.

But despite a turbulent history of operating profit, the net profit has been constantly increasing. The net

profit increased from Rs.193.56 million in 2009-10 to Rs.498.09 million in 2013-14. This is year on year

increase of 26.66%.

12% 6% 3%

20%

38%

21%

Loans and Advances Breakdown of Q3 2014

Real Estate loan

Home/Housing Loan (personalhome loan upto 60 lacs or less)

Margin Type loan

Term Loan

Overdraft Loan/TR Loan/ WCLoan

Others

0

100

200

300

400

500

600

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.


Operating Profit

Net Profit


Provision and Write Back:

The loan loss provision of the bank was Rs.560.52 million. This is an increase of 91.97% compared to last

year. The bank had a write back Rs.316.12 million in 2013-14 compared to Rs.131.2 million in 2012-13.

Comparing Q3 2013 and Q3 2014, the bank’s loan loss provision has decreased by 18.90% and reached

Rs.245.54 million. The write back of provision amount however, has increased by 92.75% and reached

Rs.124.5 million during the same period.

0

100

200

300

400

500

600

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

Mill

ion

Rs.

Loan Loss Provision

Loan Loss Provision

Write Back

Net Write Back

0

50

100

150

200

250

300

350

Q2 2014 Q3 2013 Q3 2014

Mill

ion

Rs.

Loan Loss Provision

Loan Loss Provision

Write Back

Net Write Back


CD Ratio:

The CD ratio of the bank has been hovering around the NRB stipulated limit of 80%. The CD ratio in FY

2013-14 was 82.87% and as of 3rd quarter 2014 it is75.75%.

Equity and Returns:

Share capital and net profit of the bank are both increasing. The share capital has increased from

Rs.1206.95 million to Rs.2375.08 million which is a year on year increase of 18.44%. The net profit too

has increased from Rs.193.56 million to Rs.498.09 million which is a year on year increase of 26.66%.

The ROE of the bank has also increase from 14.80% in 2009-10 to 18.09% in 2013-14. As of Q3 2014, the

bank’s ROE stands at 18.99% and its ROA stands at 1.50%. The bank had an NPL of 15.11% in

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

%

CD ratio

CD ratio

0

500

1000

1500

2000

2500

Mill

ion

Rs.

Share capital Vs. Net Profit

Share Capital

Net Profit


Dividends:

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

20.00%

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014(annualized)

ROE and ROA

Return on Equity

Return on Asset

0

2

4

6

8

10

12

14

16

18

20

2009-10 2010-11 2011-12 2012-13 2013-14

Dividend Composition

Bonus Shares (%)

Cash Div (%)


The bank has distributed an average of 13.11% dividend rate during our review period of FY 2009-10 to

FY 2013-14. The rate of dividends decreased from 2009-10 to 2011-12. It fell from 12.63% to 8.42%.

From 2012-13 however, the bank’s dividends have increased and has reached 18.95% as of FY 2013-14.

The bank has regularly distributed cash dividends at an average cash dividend rate of 9.51% but the

bank has distributed bonus shares in FY 2010-11 and FY 2013-14 only. It distributed 5% bonus shares in

2010-11 and 13% bonus shares in 2013-14.

NPL:

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

20.00%

%

Dividend History

Dividends

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

2009-10 2010-11 2011-12 2012-13 2013-14 Q3 2014

NPL to Total Loans


The NPL of the bank is at 1.79% as of the 3rd quarter of 2014. The average NPL of the bank during FY

2009-10 to FY 2013-14 was 1.78%. The bank had an NPL of 2.39% in Q3 2013.

Capital to RWA ratio:

The Capital to RWA ratio or Capital Adequacy Ratio (CAR) of the bank is at 12.99% as of 2013-14. The

core capital to RWA ratio is 10.26% and the supplementary capital to RWA ratio is 2.73%.

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

Q1 2014 Q2 2014 Q3 2013 Q3 2014

NPL to Total Loans

0

2

4

6

8

10

12

14

16

18

2009-10 2010-11 2011-12 2012-13 2013-14

%

Capital to RWA ratio

Core Capital


Tota Capital Fund

Documents

Company Analysis of Citizens Bank International Ltd.sharesansar.com/webroot/ipo pdf/citizens bank international ltd..pdf · 2015 Sharesansar.com 5/5/2015 Company Analysis of Citizens