Ujjivan Small Finance Bank Declares 15% Final Dividend of Rs 1.5 Per Share

Ujjivan Small Finance Bank declares a final dividend of 15% (Rs 1.5 per share) for FY 2023-24, reflecting its strong financial performance and commitment to rewarding shareholders.   

by Damodharan N

Updated Jul 04, 2024

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Ujjivan Small Finance Bank Declares 15% Final Dividend of Rs 1.5 Per Share

Ujjivan Small Finance Bank Limited has announced a final dividend of 15%, translating to Rs 1.5 per equity share, for the financial year 2023-24. This declaration follows the Board of Directors' meeting held on May 18, 2024, and awaits approval from shareholders at the upcoming 8th Annual General Meeting (AGM) on July 26th.

The dividend for FY 2023-24 will be distributed to equity shareholders within the stipulated time frame in FY 2024-25, upon approval. This decision reflects the bank's strong financial performance and commitment to rewarding its shareholders.

Additionally, during FY 2023-24, the bank successfully paid out a final dividend of Rs 97.74 crores (before TDS) for the previous financial year 2022-23, on August 9, 2023.

Key AGM Agenda 

  • Adoption of audited financial statements for the year ended March 31, 2024.
  • Approval of a final dividend of 15% (₹1.5 per share) for the year 2023-24.
  • Appointment of Deloitte Haskins & Sells and Abarna & Ananthan as joint statutory auditors for three years.
  • Reappointment of Mr. Samit Kumar Ghosh as a Non-Executive, Non-Independent Director.
  • Appointment and remuneration approval for Mr. Sanjeev Nautiyal as Managing Director and CEO for three years starting July 1, 2024.

Ujjivan Small Finance Bank Annual Report

Ujjivan Small Finance Bank Limited has unveiled its annual report for the financial year 2023-24, showcasing significant achievements and strategic advancements. The bank has demonstrated strong financial performance, diversified business verticals, and a forward-looking management approach, positioning itself as a leader in the small finance banking sector.

Financial Performance:

Financial performance refers to how well a company manages its financial resources and achieves its goals. It includes metrics like revenue, profit, and efficiency indicators such as return on assets and equity. In this case Ujjivan Small Finance Bank has done excellent job compared to previous year.

  • Disbursements: The bank recorded disbursements of ₹23,389 crores.
  • Loan Book: The gross loan book saw a remarkable increase of 24%, reaching ₹29,780 crores.
  • Deposits: Deposits surged by 23%, surpassing ₹31,000 crores and ending at ₹31,462 crores.
  • Profit After Tax: The bank achieved a record profit after tax of ₹1,281 crores for FY 2023-24.

Operational Excellence:

Ujjivan Small Finance Bank demonstrates operational excellence through its efficient delivery of financial services, optimized processes, and consistent focus on customer satisfaction. This enables the bank to maintain high standards of performance and enhance its competitiveness in the financial sector.

  • MicroBanking Cashless Collections: Reached 43% in the last quarter of FY 2023-24, indicating top industry performance.
  • Balance Sheet Size: Grew by 21% YoY to ₹40,422 crores.
  • Disbursements: Achieved ₹23,389 crores, reflecting a 17% YoY increase.
  • Gross Loan Book: Increased by 24% YoY to ₹29,780 crores.
  • Total Deposits: Surpassed ₹31,000 crores, ending at ₹31,462 crores, a 23% YoY growth.
  • Retail Term Deposit: Rose by 36% YoY to ₹13,750 crores.

Improving Key Ratios:

Ujjivan Small Finance Bank has shown significant improvement in its key financial ratios over the past year. 

  • Return on Assets (ROA): Stood at 3.5%.
  • Return on Equity (ROE): Reached 26.1%.
  • Net Interest Margin (NIM): Maintained at 9.1%.
  • Capital Adequacy Ratio: Stood robust at 24.7%.
  • Cost Income Ratio: Recorded at 54%.

Enhancing Asset Quality and Stability:

Ujjivan Small Finance Bank has been able to maintain healthy asset quality, improve its provision coverage, and enhance its capital and profitability ratios. This reflects the bank's focus on stability and risk management as it continues to grow its business.

  • Gross NPA: Maintained low at 2.1%.
  • Net NPA: Further reduced to 0.3%.
  • Provision Coverage Ratio: Remained strong at 87%.
  • Credit Cost: Controlled at 0.58%.

Income and Profitability:

Ujjivan Small Finance Bank has shown impressive growth in its income and profitability over the past year. 

  • Net Interest Income: Increased by 26% YoY to ₹3,409 crores.
  • Pre-Provision Operating Profit (PPOP): Achieved ₹1,917 crores, showing a 29% YoY increase.
  • Profit After Tax (PAT): Recorded at ₹1,281 crores, representing a 17% YoY growth.
  • Earnings Per Share (EPS): Stood at ₹6.65.

Business Verticals:

 Ujjivan Small Finance Bank operates across multiple business verticals, including:

  • Retail Banking: Offering a wide range of deposit products, loans, and payment services to individual customers.
  • Institutional Lending: Providing tailored financial solutions to small and medium enterprises (SMEs) and other institutions.
  • Digital Banking: Enhancing customer experience through innovative digital banking solutions and platforms.

Management Analysis: 

The management's strategic focus on risk management, customer service, and employee development has been pivotal. The Risk Management Committee has implemented robust credit risk policies, ensuring a balanced risk-reward approach.

Furthermore, the bank's commitment to employee development is evident from comprehensive training programs and leadership development initiatives.

Key Strengths and Weaknesses:

Ujjivan Small Finance Bank has strong fundamentals, including improving profitability, adequate capitalization, and consistent revenue growth. However, it needs to manage its exposure to microfinance loans and improve its asset quality to further strengthen its position in the small finance banking space.

  • Strengths:
    • Strong financial performance with consistent growth in revenue and profit.
    • Diversified business model with multiple income streams.
    • Robust risk management framework.
    • Investment in digital transformation and employee development.
  • Weaknesses:
    • Exposure to credit risk in lending operations.
    • Dependence on the performance of the retail banking segment.

Future Outlook:

 The bank's future outlook remains positive, with strategic plans to:

  • Expand its digital banking footprint to reach more customers.
  • Enhance product offerings and customer service capabilities.
  • Strengthen its risk management framework to mitigate potential risks.
  • Continue investing in employee development to build a skilled and motivated workforce.

Projects Completed: 

During the financial year, Ujjivan Small Finance Bank successfully completed several key projects, including:

  • Launch of a new Learning Management System (LMS) for employee training.
  • Implementation of advanced digital banking solutions.
  • Expansion of the retail banking network across new geographies.

This news article summarizes the key highlights of the annual report for Ujjivan Small Finance Bank Limited for the financial year 2023-24.

Read the full Annual Report and Noitce Here 

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Ujjivan Small Finance Bank Limited  

Ujjivan Small Finance Bank is a leading small finance bank in India, committed to serving the unserved and underserved segments through financial and digital inclusion. It offers a wide range of financial services and personalised customer experience.

The bank has a strong digital presence and a pan-India network of over 88 lakh customers and 632 banking touchpoints across 26 states and union territories. Ujjivan SFB was established in 2005 by Ujjivan Financial Services Limited, with the mission to provide financial services to the economically active poor.

The bank commenced its operations in February 2017 and became a scheduled bank in August 2017. Its IPO in 2019 was oversubscribed 170 times, making it one of the best IPOs in the banking and financial services sector in recent years.

Ujjivan Small Finance Bank Declares 15% Final Dividend of Rs 1.5 Per Share - FAQs

1. What were the disbursements recorded by the bank?    

 The disbursements recorded by the bank is ₹23,389 crores.

2. How much did the gross loan book increase by?  

 The gross loan book increase by 24%, reaching ₹29,780 crores.

3. What was the growth in deposits?  

 The growth in deposits is 23%, reaching ₹31,462 crores.

4. What was the profit after tax for FY 2023-24?  

 The profit after tax for FY 2023-24 is ₹1,281 crores.

5. What was the cashless collections percentage in microbanking?  

 The cashless collections percentage in microbanking is 43% in the last quarter of FY 2023-24.

6. How much did the balance sheet size grow by year-over-year?  

 The balance sheet size grow by year-over-year 21%, reaching ₹40,422 crores.

7. What was the growth percentage in gross loan book year-over-year?  

The growth percentage in gross loan book year-over-year is 24%.

8. What was the percentage increase in total deposits year-over-year?  

The percentage increase in total deposits year-over-year is 23%.

9. How much did retail term deposits rise by year-over-year? .

The retail term deposits rise by year-over-year 36%, reaching ₹13,750 crores

10. What was the return on assets (ROA)?  

 The return on assets is 3.5%.

11. What was the return on equity (ROE)?    

 The return on equity is 26.1%.

12. What was the net interest margin (NIM)?  

The net interest margin is 9.1%.

13. What was the capital adequacy ratio?  

The capital adequacy ratio is 24.7%.

14. What was the cost income ratio?  

 The cost income ratio is 54%.

15. What was the gross non-performing assets (NPA) percentage?  

 The gross non-performing assets (NPA) percentage is 2.1%.

16. What was the net NPA percentage?  

 The net NPA percentage is 0.3%.

17. What was the provision coverage ratio?  

 The provision coverage ratio is 87%.

18. What was the credit cost percentage?  

 The credit cost percentage is 0.58%.

19. How much did net interest income increase year-over-year?  

The net interest income increase year-over-year is 26%, reaching ₹3,409 crores.

20. What was the pre-provision operating profit (PPOP)?    

The pre-provision operating profit  is ₹1,917 crores.

21. What was the earnings per share (EPS)?  

 The earnings per share is ₹6.65.

22. What was the percentage increase in disbursements year-over-year?  

The percentage increase in disbursements year-over-year is 17%.

23. How much did total deposits surpass by year-end?  

The total deposits surpass by year-end is ₹31,000 crores.

24. What was the growth percentage in deposits?  

 The growth percentage in deposits is 23%.

25. What was the growth percentage in retail term deposits?  

 The growth percentage in retail term deposits is 36%.

26. What was the percentage increase in net interest income?  

The percentage increase in net interest income is 26% year-over-year.

27. What was the percentage increase in profit after tax (PAT)?  

The percentage increase in profit after tax is 17% year-over-year.

28. How did the balance sheet size compare year-over-year?  

 The balance sheet size Grew by 21% compared with year-over-year

29. What was the capital adequacy ratio at the end of the fiscal year?  

The capital adequacy ratio at the end of the fiscal year is 24.7%.

30. What was the net NPA reduced to?  

The net NPA reduced to 0.3%.

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