Kotak Mahindra Bank : Financial Results Q1 FY23

MEDIA RELEASE

KOTAK MAHINDRA BANK ANNOUNCES RESULTS

Kotak Mahindra Bank Consolidated PAT for Q1FY23 ` 2,755 crore, up 53 % yoy

Standalone PAT for Q1FY23 ` 2,071 crore, up 26 % yoy

Mumbai, 23rd July, 2022: The Board of Directors of Kotak Mahindra Bank ("the Bank") approved the standalone and consolidated results for Q1FY23, at the Board meeting held in Mumbai, today.

Consolidated results at a glance

Consolidated PAT for Q1FY23 was ` 2,755 crore, up 53% from ` 1,806 crore in Q1FY22 (` 3,892 crore for Q4FY22).

PAT of Bank and key subsidiaries given below:

PAT (` crore)	Q1FY23	Q1FY22
Kotak Mahindra Bank	2,071	1,642
Kotak Mahindra Life Insurance	248	(243)
Kotak Securities	219	236
Kotak Mahindra Prime*	157	79
Kotak Asset Management & Trustee	106	107
Company
Kotak Mahindra Investments	63	71
BSS Microfinance	56	7
Kotak Mahindra Capital Company	51	42

*: Kotak Mahindra Prime Q1FY23 PAT is after taking a hit of ` 111 crore (pre tax) on account of change in accounting policy with respect to brokerage cost

AUM (Policyholders') of Kotak Mahindra Life Insurance as on June 30, 2022 grew 15% yoy to ` 51,082 crore.

At the consolidated level, the Return on Assets (ROA) (annualized) was 2.04% for Q1FY23 (1.49% for Q1FY22).

Consolidated Capital adequacy ratio as per Basel III as at June 30, 2022 was 23.3% and CET I ratio was 22.4%. (excluding unaudited profits)

Consolidated Capital and Reserves & Surplus as at June 30, 2022 was ` 1,00,078 crore (` 86,768 crore as at June 30, 2021). The Book Value per Share was ` 502 .

Consolidated Customer Assets grew by 28% from ` 2,63,995 crore as at June 30, 2021 to ` 337,112 crore as at June 30, 2022.

Total assets managed / advised by the Group as at June 30, 2022 were ` 378,283 crore up 10% over

• 343,708 crore as at June 30, 2021.

The Relationship Value of the customers of Private Banking, Priority Banking and Investment Advisory was ~ ` 5,01,000 crore as at June 30, 2022 up 24% from ~ ` 404,000 crore as at June 30, 2021.

Kotak Mahindra Bank standalone results

The Bank's PAT for Q1FY23 stood at ` 2,071 crore, up 26% from ` 1,642 crore in Q1FY22.

Net Interest Income (NII) for Q1FY23 increased to ` 4,697 crore, from ` 3,942 crore in Q1FY22, up 19%. Net Interest Margin (NIM) was 4.92% for Q1FY23.

Fees and services for Q1FY23 was ` 1,656 crore, up 42% YoY.

Operating profit for Q1FY23 was ` 2,783 crore (Q1FY22: ` 2,890 crore).

Customers as at June 30, 2022 were 34.5 mn (26.8 mn as at June 30, 2021).

Customer Assets, which includes Advances and Credit substitutes, increased by 29% to ` 303,629 crore as at June 30, 2022 from ` 2,35,340 crore as at June 30, 2021 (` 292,481 crore as at March 31, 2022). Advances increased by 29% to ` 280,171 crore as at June 30, 2022 from ` 217,447 crore as at June 30, 2021 (` 2,71,254 crore as at March 31, 2022).

CASA ratio as at June 30, 2022 stood at 58.1%.

Average Current deposits grew to ` 55,081 crore for Q1FY23 compared to ` 46,341 crore for Q1FY22 up 19%. Average Fixed Rate Savings deposits was ` 114,237 crore as at June 30, 2022 up 8% (June 30, 2021 ` 105,724 crore). Average Term deposit up 16% from ` 112,406 crore for Q1FY22 to ` 130,035 crore for Q1FY23.

As at June 30, 2022, COVID related provisions stood at ` 482 crore. In accordance with COVID Resolution Framework announced by RBI, the Bank has standard restructured fund-based outstanding of ` 379 crore (0.14% of Advances). Under the MSME Resolution Framework, the Bank has standard restructured fund-based outstanding of ` 697 crore (0.25% of Advances) as at June 30, 2022.

As at June 30, 2022, GNPA was 2.24% & NNPA was 0.62%. Credit cost on advances for Q1FY23 was 16 bps (annualised) (excluding COVID & restructuring provision/reversal). The provision coverage ratio stood at 72.6%.

Capital adequacy ratio of the Bank, as per Basel III, as at June 30, 2022 was 22.1% and CET I ratio of 21.0% (excluding unaudited profits)

The financial statements of Indian subsidiaries (excluding insurance companies) and associates are prepared as per Indian Accounting Standards in accordance with the Companies (Indian Accounting Standards) Rules, 2015. The financial statements of subsidiaries located outside India are prepared in accordance with accounting principles generally accepted in their respective countries. However, for the purpose of preparation of the consolidated financial results, the results of subsidiaries and associates are in accordance with Generally Accepted Accounting Principles in India ('GAAP') specified under Section 133 and relevant provision of Companies Act, 2013.

About Kotak Mahindra Group

Established in 1985, Kotak Mahindra Group is one of India's leading financial services conglomerates. In February 2003, Kotak Mahindra Finance Ltd. (KMFL), the Group's flagship company, received banking license from the Reserve Bank of India (RBI), becoming the first non- banking finance company in India to convert into a bank - Kotak Mahindra Bank Ltd (KMBL).

Kotak Mahindra Group (the Group) offers a wide range of financial services that encompass every sphere of life. From commercial banking, to stock broking, mutual funds, life and general insurance and investment banking, the Group caters to the diverse financial needs of individuals and the corporate sector. The premise of Kotak Mahindra Group's business model is concentrated India, diversified financial services. The bold vision that underscores the Group's growth is an inclusive one, with a host of products and services designed to address the needs of the unbanked and insufficiently banked.

Kotak Mahindra Group has a global presence through its subsidiaries in UK, USA, Gulf Region, Singapore and Mauritius with offices in London, New York, Dubai, Abu Dhabi, Singapore and Mauritius respectively. As on 30th June, 2022, Kotak Mahindra Bank Ltd has a national footprint of 1,702 branches and 2,761 ATMs, and branches in GIFT City and DIFC (Dubai).

For more information, please visit the Company's website at https://www.kotak.com

For further information, please contact

Biswajit Dash	Sakshi Denis	Rakesh Sharma	Charlotte D'souza
Kotak Mahindra Bank	Kotak Mahindra Bank	Fortuna PR	Fortuna PR
Mobile: [phone]	Mobile: [phone]	Mobile: [phone]	[phone]
[e-mail]	[e-mail]	[e-mail]	[e-mail]

KOTAK MAHINDRA BANK LIMITED (CONSOLIDATED)

Registered Office: 27BKC, C 27, G Block, Bandra Kurla Complex, Bandra (E), Mumbai - 400 051

UNAUDITED CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER ENDED 30TH JUNE, 2022

					₹ crore
			Quarter ended		Year ended
Sr	Particulars	30-Jun-22	31-Mar-22	30-Jun-21	31-Mar-22
No	(Audited)
	(Unaudited)	(Unaudited)	(Audited)
		Refer Note 4
1	Interest earned (a+b+c+d)	9,164.28	8,838.13	8,042.82	33,740.40
	(a) Interest/discount on advances/bills	6,528.65	6,102.76	5,315.13	22,603.32
	(b) Income on investments	2,236.49	2,337.54	2,395.20	9,595.02
	(c) Interest on balances with RBI & other interbank funds	287.61	246.82	202.29	1,004.38
	(d) Others	111.53	151.01	130.20	537.68
2	Other income (a+b+c)	2,494.66	7,960.08	4,528.79	25,141.28
	(a) Profit/(Loss) on sale of investments including	(1,656.54)	(68.96)	901.16	2,122.71
	revaluation (insurance business)
	(b) Premium on Insurance Business	2,344.54	5,431.87	1,690.20	13,339.39
	(c) Other income (Refer Notes 5, 6 & 7)	1,806.66	2,597.17	1,937.43	9,679.18
3	Total income (1+2)	11,658.94	16,798.21	12,571.61	58,881.68
4	Interest expended	3,004.23	2,903.41	2,850.72	11,553.29
5	Operating expenses (a+b+c)	4,960.01	9,205.75	6,342.83	30,609.58
	(a) Employees Cost	1,839.09	1,857.34	1,593.37	7,140.93
	(b) Policy holders' reserves, surrender expense and claims	584.46	4,899.38	3,062.40	15,047.59
	(Refer Note 13)
	(c) Other operating expenses	2,536.46	2,449.03	1,687.06	8,421.06
	(Refer Note 6 & 8)
6	Total expenditure (4+5)	7,964.24	12,109.16	9,193.55	42,162.87
(excluding provisions and contingencies)
7	Operating profit (3-6)	3,694.70	4,689.05	3,378.06	16,718.81
(Profit before provisions and contingencies)
8	Provisions (other than tax) and contingencies	8.80	(398.26)	858.67	770.51
(Refer Note 9)
9	Exceptional items	-	-	-	-
10	Profit from ordinary activities before tax (7-8-9)	3,685.90	5,087.31	2,519.39	15,948.30
11	Tax expense	973.51	1,228.56	724.60	4,016.43
12	Net Profit from ordinary activities after tax before	2,712.39	3,858.75	1,794.79	11,931.87
Minority Interest (10-11)
13	Extraordinary items (net of tax expense)	-	-	-	-
14	Net Profit after tax before Minority Interest (12 -13)	2,712.39	3,858.75	1,794.79	11,931.87
15	Less: Share of Minority Interest	-	-	-	-
16	Add: Share in Profit/(Loss) of associates	43.00	33.07	11.30	157.52
17	Profit after tax (14-15+16)	2,755.39	3,891.82	1,806.09	12,089.39
18	Paid Up Equity Capital	992.72	992.33	991.34	992.33
(Face value of ₹ 5 per share)
19	Group Reserves (excluding Minority Interest and				95,641.70
Revaluation reserves)
20	Minority Interest				-
21	Analytical Ratios
	(i) Capital adequacy ratio - Basel III (standalone)	22.15	22.69	23.11	22.69
	(ii) Earnings per equity share
	- Basic (not annualised) ₹	13.88	19.41	9.11	60.76
	- Diluted (not annualised) ₹	13.88	19.40	9.11	60.73
					1

					₹ crore
			Quarter ended		Year ended
Sr	Particulars	30-Jun-22	31-Mar-22	30-Jun-21	31-Mar-22
No	(Audited)
	(Unaudited)	(Unaudited)	(Audited)
		Refer Note 4
	(iii) NPA Ratios (unaudited)
	(a) Gross NPA	7,223.54	7,334.05	8,998.55	7,334.05
	(b) Net NPA	2,143.06	2,148.72	3,294.86	2,148.72
	(c) % of Gross NPA to Gross Advances	2.27	2.37	3.58	2.37
	(d) % of Net NPA to Net Advances	0.69	0.71	1.34	0.71
	(iv) Return on average Assets (%)	0.51	0.72	0.37	2.36
	(not annualised)

NOTES:

1. The consolidated financial results are prepared in accordance with Accounting Standard - 21 (AS-21) "Consolidated Financial Statements" and Accounting Standard - 23 (AS-23) "Accounting for investment in associates in Consolidated Financial Statements" specified under section 133 and relevant provisions of Companies Act, 2013.
2. The financial statements of Indian subsidiaries (excluding insurance companies) and associates are prepared as per Indian Accounting Standards in accordance with the Companies (Indian Accounting Standards) Rules, 2015. The financial statements of subsidiaries located outside India are prepared in accordance with accounting principles generally accepted in their respective countries. However, for the purpose of preparation of the consolidated financial results, the results of subsidiaries and associates are prepared in accordance with Generally Accepted Accounting Principles in India ('GAAP') specified under Section 133 and relevant provision of Companies Act, 2013.
3. The above consolidated financial results were reviewed by the Audit Committee and approved at the meeting of the Board of Directors held on 23rd July, 2022. The results for the quarter ended 30th June, 2022 were subjected to limited review by the joint statutory auditors (Walker Chandiok & Co LLP, Chartered Accountants and Price Waterhouse LLP, Chartered Accountants) of the Bank and there are no modifications in their Limited Review Report. The results for quarter ended 30th June, 2021 were subjected to limited review by Walker Chandiok & Co LLP, Chartered Accountants.
4. The figures for the quarter ended 31st March, 2022 are the balancing figures between audited figures in respect of full financial year ended 31st March, 2022 and unaudited published year to date figures for nine months ended 31st December, 2021.
5. Details of other income forming part of the consolidated results are as follows:
6. • crore

		Quarter ended		Year ended
Particulars	30-Jun-22	31-Mar-22	30-Jun-21	31-Mar-22
(Audited)
	(Unaudited)	(Unaudited)	(Audited)
	Refer Note 4
Commission, fees, exchange, brokerage and others	2,802.71	2,841.74	2,100.67	10,136.02
(net)
Profit/(Loss) on sale and provisions/(write-back) of
mark-to-market depreciation on investments (other than	(996.05)	(244.57)	(163.24)	(456.84)
insurance business)
Total - Other income	1,806.66	2,597.17	1,937.43	9,679.18

1. Other income in the consolidated results for the reporting periods is net of sub-brokerage paid in the broking subsidiary amounting to ₹ 37.84 crore for the quarter ended 30th June, 2022 (₹ 52.85 crore for the quarter ended 31st March, 2022, ₹ 34.97 crore for the quarter ended 30th June, 2021 and ₹ 168.19 crore for the year ended 31st March, 2022).
2. Other income includes non-fund based income such as commission earned from guarantees / letters of credit, financial advisory fees, selling of third party products, earnings from foreign exchange transactions, profit / (loss) from the sale of securities and provision / (write-back) of mark-to-market depreciation on investments (other than insurance business).

2