CSB Bank Ltd - Stock Valuation and Financial Performance

The Bank was incorporated on November 26, 1920 under the Indian Companies Act, 1913 as ‘The Catholic Syrian Bank Limited’. A fresh certificate of incorporation under the Companies Act, 1956 was issued by the Registrar of Companies, Kerala at Ernakulum (RoC) on April 14, 1987. The Shareholders of Bank approved the change of the name of Bank from ‘The Catholic Syrian Bank Limited’ to ‘CSB Bank Limited’ through a postal ballot resolution dated May 4, 2019. RBI through its letter dated April 1, 2019 conveyed its ‘no objection’ in terms of Section 49B of the Banking Regulation Act to the change of name of Bank from ‘The Catholic Syrian Bank Limited’ to ‘CSB Bank Limited’. Subsequently, a fresh certificate of incorporation under the Companies Act, 2013 was issued by the RoC on June 10, 2019 and a fresh license bearing no. MUM-147 dated June 28, 2019 was issued by the RBI under Bank’s new name to carry on the banking business in India, in lieu of Bank’s previous license dated June 19, 1969. The name of Bank was changed to ‘CSB Bank Limited’ from “The Catholic Syrian Bank Limited”, in the second schedule of the RBI Act with effect from June 10, 2019.

CSB Bank is one of the oldest private sector banks in India with a history of over 98 years and has a strong base in Kerala along with significant presence in Tamil Nadu, Karnataka, and Maharashtra. It offers a wide range of products and services to its overall customer base of 1.3 million as on September 30, 2019, with particular focus on SME, Retail, and NRI customers. It delivers its products and services through multiple channels, including 412 branches (excluding three service branches and three asset recovery branches) and 290 ATMs spread across 16 states and four union territories as on September 30, 2019, and various alternate channels such as micro ATMs, debit cards, internet banking, mobile banking, point of sale services and UPI. While the bank has a long operating history as a traditional bank, it is currently focusing on implementation of strategic changes in its business model to function efficiently as a full service new age private sector bank backed by its new marquee investor - FIHM, its Promoter.

Business area of the bank

Under its SME banking business, the bank caters to financial institutions, agriculture and allied businesses, and vendors and dealers of corporates. It offers a wide range of products including term loans, working capital loans, invoice/bill discounting, letters of credit and bank guarantees. Under its retail banking business, it offers a wide range of loan and deposit products to its retail and NRI customers. Its retail lending products include gold loans, vehicle loans including two wheeler loans, loans against properties, personal loans, housing loans, agricultural loans, and education loans. Under its wholesale banking business, the bank caters to large and mid-size corporates and other business entities (with credit requirement of Rs 250 million and above). Besides, the banks treasury operations primarily consist of statutory reserves management, asset liability management, liquidity management, investment and trading of securities, and money market and foreign exchange activities.

Major Events & Milestones

• 1920: Incorporation of bank.
• 1964-65: The bank took over the assets and liabilities of six small and medium sized banks located in Kerala.
• 1969: The Bank was included in the second schedule to the RBI Act.
• 1972: Opened first branch in the state of Maharashtra in Mumbai.
• 1973: Opened first branch in the state of Karnataka in Bengaluru.
• 1975: Received license to deal in foreign exchange and mechanized reconciliation of inter-branch transactions.
• 2003: Changed the logo and colour scheme to create a new image of bank.
• 2004: Total business (advances plus deposits) crossed Rs 50,000 million.
• 2009: Total business (advances plus deposits) crossed Rs 100,000 million.
• 2015: Obtained approval of the FIPB for increasing the FDI limit in bank to 74% of the paid up share capital of bank.
• 2015: Public launch of mobile banking.
• 2018: RBI accorded its approval to FIHM to acquire 51% of the post issue paid up share capital of bank.
• 2019: Established bank’s two wheeler loan business.
• 2019: The bank changed its name, logo and color scheme.
• 2020: CSB Bank has entered into a partnership with non-banking finance company, IIFL Finance (IIFL) for sourcing and managing retail gold loan assets.