CSB Bank Limited

1.1 Brief History of the Company

Established in 1920 as The Catholic Syrian Bank Limited, CSB Bank Limited had its
modest beginning in November 1920 and is currently the oldest private sector bank in
Kerala, celebrating its Centenary Year in 2020. During this century long period, the Bank
has grown from strength to strength, adapting admirably to the far-reaching social,
political and economic changes that have taken place during the period.

It was in the year 1969 that the Bank became a Scheduled Bank, as it was included in
the Second Schedule of Reserve Bank of India Act. In 1972 it came out of its traditional
bastion and opened its first branch in Chembur, Mumbai. “A Class” Scheduled Bank
status was attained by the Banking the year 1975 and it entered the field of
International Banking in the same year. Currently the bank has 417 branches
(comprising 3 service branches and 3 asset recovery branches) and 310ATMs
(including onsite and Offsite) spread across 18 states, 2 union territories. Out of the
432branches (excluding 3 service branches and 3 asset recovery branches). For efficient
administration, the Bank has organized all its branches under 9 Zonal offices. The Bank
delivers its products and services through multiple delivery channels that include
branches, ATMs, internet and mobile banking.

Bank has been rebranded in the year 2019 by change of name from The Catholic Syrian
Bank Limited to “CSB Bank Limited”, to address region and community related
perceptional issues associated with our previous brand name.

The Bank successfully completed its Initial Public Offering (IPO) to the tune of Rs.
409.67 crore which received an overwhelming response from the investors and the
issue was subscribed overall by 86.92 times. Subsequently, the Bank’s shares were
listed on Indian stock exchanges on 4 December 2019.

Since June, 2009 all our branches have been brought under CBS platform, a software
Programme named MAARVEL, developed jointly with a reputed software company.
Technology has been leveraged for providing banking convenience to customers and all
our branches have been enabled and included in the RTGS network.

CASA portfolio constitutes29.17% of our total deposits. With the intention of making
the right proposition to the right customer at the right time, tailor made banking
products have been designed to cater to the specific banking needs of various sections
of the society. The Bank currently has four principal business areas, namely, (a) SME
Banking, (b) Retail Banking, (c) Corporate Banking and (d)Treasury Operations.

1.2 Business process of organization-Products

Products of bank

Personal NRI Business

Account and deposits Account and deposits Financial inclusion

Loans Loans Agri banking
Insurance Insurance SME banking
Investments Investments Corporate banking
Forex Forex -

I. Personal products list

Accounts and Loans Insurance & Forex

deposits Investments
Savings account Gold loan Life insurance Outward
remittances
Current account Vehicle loan General insurance Foreign Currency
Cash
Fixed deposits Personal loan Social security Integrated
schemes Treasury
Safe locker box MSME loan e-trade -
Demat account Home loan Sovereign gold bond -
Deposits Retail loan -- -
II. NRI Products List

Account and deposits loans Insurance & Forex

Investments
NRO account NRI gold loan Life insurance Remittance services
NRE account NRI vehicle loan General Forex rates
insurance
FCNR Account NRI housing Social security Integrated treasury
loan schemes
RFC Account NRI property e- trade -
loan
- Other NRI loans Sovereign gold -
loan

III. Business banking

 AGRI/FIN Banking SME banking Corporate banking

PMJJBY Term loan Working capital finance

(Pradhan Mantri Jeevan
Jyoti Bima Yojana

PMSBY (Pradhan Mantri Working capital loan Corporate loan

Suraksha Bima Yojana)

Government schemes Export finance Term loan

Subsidy Cash credit /OD Bill finance

Other product and service

INSTA pay (fee collection)

Electricity bill payment

Payment service

Door step banking service

Donation and offerings

Debit card offers

1.3 Customers of company Levels of Operations

Customer is a person who avails any product or service from a organization or a
business.
Customers can be classified into,
 Minors
Who has not reached age of 18 years, He needs a local guardian to operate
his account.
 Illiterate person
lliterate person is a person who cannot read or write. He operate account
using thumb impressions.
 HUF
Accounts has been managed by Karta.
 Partnership Firms
 Partnership is the relation between persons who have agreed to share
profits of business carried on by all or any one them acting for all. 

 Company Accounts
Company Act 2013, recognise Company is a legal person with perpetual
entity & is distinct from its members.
 Trusts
Trust may be public charitable trust or private trust (for benefit of private
individuals). Trusts managed by trustees. 
 Clubs and Societies
Society & Clubs are non-profit making organisations and represents a
group of persons. These are normally incorporated under Cooperative
Society Act. 
 NRIs
Person who are Indian citizen but not in India for a period of 182 days in
previous year.
 Joint accounts
Account which has been shared by two or more individual.

The Bank currently has four principal business areas, namely,

(a) SME Banking,

Loans for small medium enterprise are business loans extended only to medium-
sized enterprises. These are tailor made to suit the needs and requirements of
SMEs.
(b) Retail Banking,
Retail banking also known as consumer banking or personal banking, is the
provision of services by a bank to general public, rather than to companies,
corporations or other banks, which are often described as wholesale banking.
(c) Wholesale Banking
CSB Bank fulfils business needs of large & mid-size corporates, and business
entities of Rs 250 million and more credit requirement under Wholesale Banking
category.
(d)Treasury Operations.

Under Treasury Operations, the bank deals with asset-liability management, statutory
reserves management, trading & investment of securities, foreign exchange, and
liquidity management activities. This category is aimed to maintain liquidity
requirement to comply with the CRR (Cash Reserve Ratio) and SLR (Statutory Liquidity
Ratio), which are RBI Mandates.

The company also has a contractual arrangement to distribute life insurance products of
HDFC, Edelweiss Tokio, and ICICI Prudential Life Insurance Company Ltd and general
insurance products of Reliance General Insurance Company Ltd.

1.4 Competitors of Company

HDFC Bank

ICICI Bank

Kotak Mahindra Bank

Axis Bank

IndusInd Bank

Bandhan Bank

IDBI Bank

Yes Bank

AU Small Finance Bank

IDFC First Bank

Federal Bank

City Union Bank

RBL Bank
Equitas Bank

Ujjivan Bank

South Ind Bank

Dhanalaxmi Bank

JK Bank

1.5 Strategies of the Bank

 CSB Bank, formerly known as The Catholic Syrian Bank, may redistribute its
branch network in Kerala, closing some branches where it already has a dense
network and adding more in areas like the northern parts of the state. It also has
plans to expand its network across other states in southern and western India.
 CSB Bank has plans to add another 425 branches.
 Bank has 100 branches in Thrissur district. They plan to close about 40 branches
in Thrissur and spread in Northern Kerala
 CSB Bank also aims to grow its lending to small and medium enterprises.
 Going forward, it expects 30 per cent of its total portfolio will be SME,
 35 per cent gold loans and around 15 per cent retail.
 At the same time, its corporate portfolio will come down to 15 per cent from
around 35 per cent over a period.

1.6 CSR Activity

The CSR policy of the Bank aims to identify and support all projects/programs/subjects
undertaken as part of the Bank’s Corporate Social Responsibilities within the
framework of Schedule VII of the Companies Act, 2013 and the Companies (Corporate
Social Responsibility Policy) Rules, 2014, as amended. The policy will serve as a guiding
document to help identify, execute and monitor CSR projects in keeping with the spirit
of the policy.
 1) Sponsorship of education of children of Martyr -Measures for the benefit of
armed forces veterans, war widows and their dependents -Local area, Wayanad
District, Kerala.
2) Setting up homes for socially and economically backward groups in the society
including for women and orphans-Slum area development -Local area, Thrissur
District, Kerala.
3) Guaranteed Emergency Credit Line Scheme (GECL) Relief to all business
enterprises/ MSME sector by providing additional working capital term loan to
meet operational liabilities and restart businesses in the unprecedented
situation COVID-19.
1.7 Export/ Import
o Export/Import Finance
Pre and post shipment financing, forward covers, buyers credit and finance in

foreign currency.
o Buyers’/ Suppliers’ Credit
Arrangement of buyers’/ suppliers’ credit through overseas banks/ correspondents to help
reduce cost for importers as per RBI guidelines.
o Letter of Credit
Credit service for importers
1.8 Collaboration and Expansion Plans

Bank was looking to expand its network to north side of Kerala. They also aim to have
branch representation in all district headquarters and semi-urban area.

Currently, as a prelude to the expansion plans, the bank is in the process of establishing
banking kiosks in the rural and unbanked areas. The kiosks would have touch-screen
facility and would provide information about the weather and commodity/equity
updates in the local language besides serving as a cash dispenser.

The Catholic Syrian Bank Limited, Northern Zone has inaugurated three branches of
CSB Bank, namely Rohini Sector-7, Okhla-Phase 2, and Shalimar Bagh on 23.10.2020. He
has further indicated about the expansion of the Bank in Northern and Eastern region
by opening of 50 more branches.
The proposed branches are identified at areas where there is good demand for Gold
Loans, MSME, Corporate Loans and to extend support to other needy customers. Gold
loan is the unique selling product of CSB Bank Limited with its attractive interest rate,
higher LTV (Loan to Value Ratio) up to 90%, low turnaround time and easy takeover
facility from other financial institutions. The aim of the Bank is to attain a Gold loan
portfolio of Rs. 10,000 Cr.

The bank recently also developed an app -- CSB Wink -- allowing customers to open
accounts instantly in a remote manner. CSB Bank is also working on expanding its
products suite, services, and digital banking platform, with investments in technology
aimed at improving customer experiences and offering them a range of products
tailored to their financial needs.

In order to enhance our existing retail and franchise offerings, we have created digital
on-boarding facilities, via CSB Wink that offers digital account opening, e-wallet
facilities, online FD services, virtual debit cards and will aid in higher deposit.

1.9 SWOT analysis of CSB

Strengths of CSB

 Rising Net Cash Flow and Cash from Operating activity.

 Company with high TTM (Trailing 12 Months) EPS Growth.
 Strong Annual EPS Growth.
 Growth in Quarterly Net Profit with increasing Profit Margin (YoY).
 Company with Low Debt.
 Increasing Revenue every Quarter for the past 4 Quarters.
 Company with Zero Promoter Pledge.
 FII / FPI or Institutions increasing their shareholding.
 Strong Momentum: Price above short-, medium- and long-term moving averages.

Weakness of CSB

 High Interest Payments Compared to Earnings.

 Decline in Net Profit with falling Profit Margin (Quarter on Quarter).
 Promoter decreasing their shareholding.
 Stock is trading at 2.78 times its book value.
 Though the company is reporting repeated profits, it is not paying out dividend.
 Company has low interest coverage ratio.
 The company has delivered a poor sales growth of 4.77% over past five years.
 Company has a low return on equity of 0.84% for last 3 years.
 Earnings include other income of Rs.400.81 Cr.

Opportunities of CSB

 Positive Breakout Second Resistance (LTP > R2).

 Highest Recovery from 52 Week Low.
 Decrease in NPA in recent results.
 RSI (Relative Strength Index) indicating price strength.
 Stocks near 52 weeks high with significant volumes.

Threats of CSB

 Increase in Provision in recent results.

 Companies increasing debt as per recent annual report.