Equitas Holdings Ltd Chairman Speech

Dear Shareholders,

I am happy to communicate with you once again through this Annual Report, for FY 2018-19.

This year, we returned to our high growth momentum with a significant improvement in profitability. The Bank continues to focus on building a stable and sustainable franchise by diversifying the portfolio mix towards secured lending while improving profitability. Our commitment towards reaching out to the unbanked and underbanked segments through a wide range of products continues with our new products like New Commercial Vehicle loans, working capital loans etc.

Retail deposit momentum builds up

The strategy of our bank to create a long-term, granular retail liability franchise through our branches continues to perform well. We added more than 5 lakh retail depositors, with customer balances crossing Rs. 8,000 Crore; retail fixed deposits accounted for Rs. 2,408 Crore.

We continue to deliver “value for money” banking experience to our depositors through a rich value proposition and customer benefit programmes across our Current and Savings accounts.

Today, “Wings”, our differentiated offering, contributes 29% of overall CASA balances.

Deposits as a percentage of total borrowings stood at 69% while CASA stood at 25% of total deposits. The deposit momentum also ensured our Bank’s growth was not affected by the liquidity crisis the financial sector witnessed in the second half of 2018-19.

Scalable and Sustainable Growth in Advances

In 2016-17, I had highlighted the Banks ability to conduct credit assessments of borrowers from the informal economy and its focus on leveraging these skills to introduce new products mainly Agri loans and Business Loans. In 2017-18, I had shared the growth from these products had touched 13% of our portfolio and the introduction of New Commercial Vehicle loans and Working Capital loans, in line with our strategy of leveraging the skills we honed over the past decade.

I am happy to inform you that our strategy of diversifying and offering a wide array of financing solutions to the segments that we operate in continue to progress well and now contribute 47% to our overall portfolio. We are confident that with the seeding of these products early on, our Bank will enjoy a competitive edge in the years to come.

Focus on Technology

Our Bank continues to invest in technologies that improve operating efficiencies, security and risk management and customer experience, and help build a bank ready for tomorrow’s customers.

We have started to realise the positive impacts of investing in emerging technologies like API Banking, Robotic Process Automation, Facial Recognition, Autonomous Account Opening and Analytics. We believe that in the changing regulatory environment, banks with a strong technology practice will see a differentiated journey. We are on this journey with some of the world’s best technology companies.

Social Initiatives

Our social initiatives such as free health camps, livelihood skills training and job placement fairs for unemployed youth continue to create a difference. Eight Equitas Gurukul schools are functioning well under the aegis of Equitas Development Initiatives Trust (EDIT). The schools provide high quality, affordable education to 5,500 students from low-income households. Their achievements in academics as well as sports provides us great joy and pride.

With the support from all our stakeholders, I am confident that the Group shall continue to grow further, achieve bigger milestones in banking and serve the society further more meaningfully. I thank you all for your continued support in our journey of making Equitas Small Finance Bank one of the country’s most respected and valuable bank.

God bless you!

Rangachary N

Chairman, Equitas