2. Taking the long view
Taking the long view

Focusing on opportunities amid
evolving market dynamics

The banking industry is the backbone of any economy. It also acts as an important enabler and a key contributor towards capital formation and demand creation. Currently, the banking industry is at a crossroads in India. On the one hand, its strength and resilience is increasingly being put to test. On the other hand, a large underbanked population continues to offer a multitude of opportunities to the sector, particularly for a new banking enterprise like ours.

The great Indian opportunity landscape

India

718

Districts

`138LAKH CRORE

Deposits

~2.15CRORE

New vehicle sales in
FY 2019-20

~40LAKH

Used vehicle sales
in FY 2018-19

~1.74CRORE

Two-wheeler sales in
FY 2019-20

~6.33CRORE

Number of registered MSMEs

AU Bank (Outstanding as on 31ST MARCH, 2020)

243

District Footprint

`26,164CRORE

Deposits

~2.9LAKH

New vehicles financed

~2.5LAKH

Used vehicles financed

~36,000

Two-wheelers financed

~1.2LAKH

Number of MSMEs financed

Our Financing Vintage offers scalable
foundation

  • ‘Ear to the ground’, agility, push and cost-conscious approach
  • Nuanced understanding of perceived risks; with resilient pricing power
  • 25+ years of small ticket, secured lending vintage in niche product across customer segments
  • Strong underwriting, monitoring and collections abilities

Bank brand pull drives multiplier momentum – a natural pull

  • Comprehensive suite of products and services along with a significant cross-sell lever gives us opportunity to foray into untapped markets
  • Strong balance sheet, healthy capital adequacy, compliant with SFB guidelines
  • Operating leverage unfolding gradually and driving better returns
  • Investing in brand, engagement, technology, product and distribution to enhance scale
  • Execution focused leadership team, stable and seasoned second line driving consistent progress

In this environment, the unique combination of AU franchise i.e. a) Our Financing Vintage and b) The ‘Trust and Opportunities Landscape of Banking Platform’ offers best of both worlds. AU has got the agility, swiftness and push of a financier and now for the last three years it has also got the strong ‘Trust’ and ’Pull’ of a Bank. Banking platform allows us a plethora of opportunities for cross-selling and holistically serving the customer for all their requirements.

Moreover, AU Bank’s strong balance sheet, robust liquidity and capital adequacy position, strong governance and risk management; access to diversified sources of funding, and superior digital delivery capabilities make it relatively well placed to navigate through the present challenging times.

We are constantly upskilling our team, fortifying our ‘phygital’ distribution, ensuring early adoption of newer trends and technologies, strengthening our technology architecture to driving process efficiency and customer delight. We are also broadbasing the use of our analytics platform to enhance the pace and quality of credit decisions, customer service and collections, new customer acquisitions, smoothen the onboarding process, and improve crossselling opportunities.

We believe that becoming a ‘Bank’ has helped us harness the ‘pull’ of a bank and the innate ‘push’ orientation of a financier. In the near term, we remain cautious and continue to build a strong foundation for our Bank. However, for the long term, we remain committed to steady value creation by pursuing our retail-led growth strategy.