UTKARSH VOICE Q1 [FY 16 -17]: Volume-8, Issue-1

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Q1 FY 2016 -17 Highlights

The closure of Q1, FY 16 -17, saw further expansion of business operations of the company

and also development towards transition into a Small Finance Bank. The microfinance

outreach of the company reached to over 100 districts (102 districts as on Jun 30, 2016) of

the country for offering different financial & non-financial services to clients and other

beneficiaries. The company crossed the portfolio outstanding landmark of ₹1,500 Mn in

the month of May 2016. As at the close of the Q1, the company had 1,074,988 Microfinance

outreach (JLG) clients and 15,689 Micro Enterprises Loan clients.

In the process of transition to Small Finance Bank our company in now a public limited

company. The name of the company is now Utkarsh Micro Finance Limited (in place of

Utkarsh Micro Finance Private Limited) since Jun 24, 2016. Also, to align with the branding

for CSR initiatives, the name of Samutkarsh Welfare Services has been changed to ‘Utkarsh

Welfare Foundation’ w.e.f. May 26, 2016.

As per the audited financials for the financial year 2015 - 16, the company achieved a Profit

Before Tax (PBT) of ₹209.82 Mn for the quarter ended Jun 30, 2016 as against the PBT of

₹126.2 Mn for Q1 FY 2014 – 15. The company continued to have an excellent portfolio

quality with reduction in operating cost, lower cost of fund, efficient cash management

practice, steady growth and improvement in process.

The microfinance outreach (JLG Business) of the company had 1,074,988 active client base

with a portfolio outstanding of ₹14,982.4 Mn, and the Micro Enterprises Loan Business and

Housing Loan Business (pilot project) had 15,689 and 97 active clients base respectively

with portfolio outstanding of ₹919.3 Mn and ₹25.5 Mn respectively.

Under the Credit Plus initiatives, the company continued to take up its activities focused

on Education (Financial Awareness), Health (Branches and also Mobile Poly Clinic vans)

and Goodwill gestures. Incrementally, the company launched the second Mobile Van Poly

Clinic at 5 branches in Satna Division, Madhya Pradesh during Q1, FY 2016 – 17.

Along with all business activities, the quarter was marked special with new incumbents

joining in the Senior Management. Mr. Adhip Ranjan Syamroy, joined the company as

Chief Operating Officer (COO), Mr. Malkit Singh Didyala, Business Head - MSME and Agri

Loans, Mr. Rajeev Bhatia as Head - Information Technology, Mr. Alok Pathak as Head –

Risk, Mr. S.S. Ramanathan as Head – Compliance and Mr. Anirban Dastidar as Head – Third

Party Product.

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In recognition of the performance through Annual Performance Appraisal, the company

sent the 1st

and 2nd

batch of 84 employees (representing operations and non-operations

employee from branches and administrative officers) for ‘Reward and Recognition Tour’

to Jaipur from June 9, to 13, 2016 and June 23 to 27, 2016 respectively.

New Incumbents in the Senior Management Adhip Ranjan Syamroy - Chief Operating Officer (COO)

He has over 25 years of experience in Banking and Financial sectors. Prior

to joining Utkarsh, he was with Axis Bank for nearly 21 years in senior

leadership roles handling Customer Service, Corporate Real Estate,

Employee Experience and HR Operations. He has also worked with SBI

Home Finance Ltd. for about 4 years handling assignments in the area of

housing loans to individuals and real estate developers. He is an engineer

from Indian Institute of Engineering, Science and Technology.

S.S. Ramanathan, Head - Compliance He has 18 years of banking experience spread across Branch Banking,

Operations, Branch Sales Management, Governance and Compliance. Prior

to joining Utkarsh, he was heading the compliance functions relating to

Retail Banking, Control Functions and additionally handled the Subsidiary

Governance in Axis Bank. He is a founding member of UBL Sales Ltd (Now

Axis Securities Ltd.,) a subsidiary of Axis Bank and has been instrumental in

setting up of the various departments of the subsidiary. He has been

involved in implementation of projects of high importance in Axis Bank.

Prior to Axis Bank, he has worked with IDBI Bank and ICICI Bank in various

capacities in branch banking. He is graduate from University of Madras and ICWAI (Inter)

and has also completed a certificate course from The Strategy Academy, Kolkatta.

Rajeev Bhatia, Head - Information Technology He has over 13 years of experience in technology and banking sector. Prior

to joining Utkarsh, he was with Axis Bank as Group Head – CBS and Digital

Banking, responsible for implementing and managing Core Banking

System, Internet Banking, Mobile Banking and Wallet Systems of Axis Bank

from IT perspective. Prior to Axis, he was with Infosys as Project manager,

responsible for Implementing Finacle CBS in various banks’ projects across

India and Overseas. As part of Infosys, he has worked for all major banks

projects during various stages of core banking implementation. He holds

Post Graduate Certificate in General Management from IIM, Indore.

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Alok Pathak, Head - Risk He has over 18 years of experience in Banking and Financial Sector in the

domain of Risk Management, Corporate Lending, Liabilities, Forex,

Treasury, Trading in Govt Securities, Equities and Maintenance of SLR and

CRR. Prior to joining Utkarsh, he was with Yes Bank Ltd. as Executive Vice

President and in various capacities with Axis Bank, Oriental Bank of

Commerce and State Bank of Mysore. He is a Science Graduate from

Kanpur University, PGDCA from Aptech Computers, CAIIB from IIBF,

Mumbai and a Certified Banking Compliance Professional (a course

conducted by IIBF & CS jointly).

Malkit Singh Didyala, Business Head - MSME and Agri Loans

He holds a Post Graduate Diploma in Rural Management (PGDRM) from

IRMA. He is a seasoned finance and banking professional with over 12

years of experience across various roles and organizations. He also brings

a deep understanding of the rural / informal economy due to his stint in

the co-operative dairy sector. He started his career in Banking at ICICI Bank

Ltd. with the microfinance business of the Bank and handled roles across

product and credit. He graduated to a larger role in ICICI Bank in the

Financial Institutions Group handling relationships with domestic financial

institutions and undertaking credit sell-down of underwritten loans. Post

ICICI Bank, he joined Bajaj Finance Ltd as Zonal Head for Infrastructure Finance and also

handled large ticket mortgage and LRDs. In the last role at BFL he set-up the Financial

Institutions Group engaged in lending to other domestic financial institutions.

Anirban Dastidar, Head – Third Party Product

He is an MBA from National Institute of Management Kolkata. He has over

13 years of experience in life insurance industry and financial sector all

throughout his career. Prior to joining Utkarsh, he has worked with ICICI

Prudential Life Insurance, Max Life Insurance, HDFC Life in the

bancassurance space, agency vertical and corporate agencies channel at

senior leadership role. He is a Commerce graduate from Calcutta

University and PGDBA from Annamalai University.

Employee Speak “…”

“I joined Utkarsh as Manager Account on November 1st

2009. Currently, I am working

as AVP Finance & Accounts. These six years of journey with Utkarsh were full of learning

and I got many opportunity to explore my knowledge and ability in growth of the

organization. Here, I have always been groomed and developed to be an effective and

efficient employee and more than that a responsible human being. I can really say that

Utkarsh is one of the Best Places to work and realize one’s potential.

Excerpts from a talk with Mr. Jugal Kishor Pandey, Finance & Accounts Department,

Corporate Office, Varanasi.

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OPERATIONAL HIGHLIGHTS

The outreach of the company grew to newer operational geographies in 10 states viz. Uttar

Pradesh, Bihar, Jharkhand, Delhi-NCR, Uttarakhand, Himachal Pradesh, Haryana,

Maharashtra, Madhya Pradesh and Chhattisgarh. The total districts being covered in 10

states grew to 102. The branch network expanded to 357 [334 JLG Branches and 23 MEL

Branches] with (2 MEL Branches having Housing Loan pilot business also) for serving more

than 10 lakh active clients.

At the close of Q1, FY 2016 -17 the JLG portfolio stood at ₹14,982.4 Mn with 1,074,988

lakh Active Clients, the MEL portfolio was ₹919.3 Mn with 15,689 active clients and the

Housing Loan pilot reached 97 active clients with ₹25.5 Mn portfolio outstanding. The total

portfolio of the Company was ₹15,927.2 Mn as on June 30, 2016.

A comparative summary of the operational highlights of the company is as below:

Particulars As on June

30, 2016 As on Mar 31, 2016

As on June 30, 2015

MICROFINANCE OUTREACH

No. of States 10 10 8

No. of Districts 102 98 68

Total No. of Branches 334 321 251

No. of Branches in Uttar Pradesh 103 100 92

No. of Branches in Bihar 107 103 81

No. of Branches in Maharashtra 34 33 26

No. of Branches in Madhya Pradesh 29 29 18

No. of Branches in Delhi - NCR 8 8 8

No. of Branches in Uttarakhand 13 13 13

No. of Branches in Himachal Pradesh 1 1 1

No. of Branches in Haryana 16 16 11

No of Branches in Jharkhand 19 15 -

No of Branches in Chhattisgarh 4 3 -

Total No. of Centers 65,722 60,484 41,957

Total No. of Groups 292,481 264,576 172,807

Total No. of Members 1,143,978 1,061,050 720,226

Total No. of Clients 1,074,988 995,810 669,810

Total Disbursement – Cumulative ( in Mn) 38,849.8 33,964.8 20,339.2

Loan Outstanding ( in Mn) (Own+ Managed) 14,982.4 13,433.4 7,685.2

Total No. of Loan Disbursed 2,290,129 2,054,248 1,344,113

Total No. of Credit Officers 1,611 1,520 1,066

No. of Client Per Credit Officer 667 655 628

Repayment Rate (%) 99.4% 99.8% 99.8%

Par > 30 Days

No. of Clients 2,125 1,138 262

Amount ( In Mn) 22.2 11.11 2.17

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Particulars As on June

30, 2016 As on Mar 31, 2016

As on June 30, 2015

MICRO ENTERPRISES LENDING

No. of States 7 5 4

No. of Districts 23 21 15

Total No. of Branches 23 21 17

Total No. of Loan Disbursed 18,816 17,463 9,333

Total No. of Clients 15,689 14,326 8,100

Total Disbursement – Cumulative ( in Mn) 1,431.7 1,315.4 616.0

Loan Outstanding ( in Mn) (Own +Managed) 919.3 871.3 422.5

No. of Relationship Officer (RO) 166 141 118

No. of Clients /RO 95 102 69

PAR > 90 Days

No. of Clients 471 367 277

Amount (In Mn) 18.0 14.65 9.49

AFFORDABLE HOUSING LOAN

No of States 2 2 -

No. of Districts 2 2 -

Total No of Branches 2 2 -

Total no of Loan Disbursed 110 72 -

Total No. of Clients 97 72 -

Loan Outstanding (₹ in Mn) 25.5 20.2 -

NATIONAL PENSION SYSTEM (NPS)

No. of States 2 2 2

No. of Districts 13 13 13

Total No. of Branches 53 53 53

No. of Accounts 34,143 34,143 34,151

Total Subscription-Cumulative ( in Mn) 12.5 11.8 10.45

EMPLOYEES

Operational Employees 2,592 2,430 1824

Total Employees 2,853 2,636 1973

EMPLOYEE DETAILS

Particulars As on Jun. 30, ‘2016

As on Mar 31, ‘2016

As on Jun. 30, ‘2015

JLG Operation 2334 2188 1634

MEL Team & AHL 273 261 190

Support and Control Team 246 187 149

TOTAL 2,853 2,636 1,973

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FINANCIAL PERFORMANCE The Company achieved a PBT of ₹209.82 Mn for the FY 16 - 17. Important financial

parameters are as below:

Particulars As on Jun. 30, ‘2016(Unaudited)

As on Mar 31, 2016 (Audited)

As on Jun. 30, ‘2015 (Unaudited)

Income (₹ in Mn) 913.85 2537.8 512.9

Expenses (₹ in Mn) 704.02 1926.7 386.7

Profit Before Tax (₹ in Mn) 209.82 611.1 126.2

Net Worth (₹ in Mn) 2654.2 2525.8 2398.6

Key indicators Q1 FY 2016 - 17

SOCIAL INTERVENTIONS (Credit Plus Activities)

HEALTH INITIATIVES

In order to provide primary health care services in Company’s operational area where

medical facilities are limited, Utkarsh Welfare Foundation (UWF) has tied up with Ram

Krishna Sewashram Hospital and GV Meditech Group. In association with them, UWF

organizes Poly Clinics at Branches and also through Mobile Vans.

These Poly Clinics are organized fortnightly every month in 8 branches. The beneficiaries

are given free medical consultation and medicines. A total of 47 Poly Clinics were

Organized during Q1 FY 2016-17, benefiting 3,475 patients. The company is presently

operating its Mobile Van facility in 10 branches; 5 in Satna Division, Madhya Pradesh and

5 in Gorakhpur Division, Uttar Pradesh. Till date, a total of 150 Mobile Van Poly Clinics have

been organized and 21335 patients have benefitted with medical services.

In the Q1 FY 2016 -17, a total of 10,717 patients have been provided with Primary Medical

Health Care services across 18 branches.

Key Indicators As on Jun. 30,

2016 (Unaudited) As on Mar 31, 2016 (Audited)

As on Jun. 30, ‘2015 (Unaudited)

CRAR 19.25% 20.68% 31.8%

Operating Self Sufficiency

(OSS)

131.2% 133.3% 133.7%

ROA 3.35% 3.29% 2.6%

ROE 19.77% 15.88% 13.1%

Debt Equity 4.74% 4.81 2.7

Operating Expense Ratio 7.53% 7.16% 7.0%

Cost of Borrowing 12.91% 13.48% 14.5%

On Time Repayment Rate 99.4% 99.8% 99.9%

UTKARSH VOICE Q1 [FY 16 -17]: Volume-8, Issue-1

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FINANCIAL AWARENESS

In association with Swiss Capacity Building Facility (SCBF) – ACCION

This project was launched in May 2015, in 5 branches and during Q1 FY 2016 - 17, a total

of 3,186 beneficiaries received Financial Literacy training. Cumulatively a total of 14,875

beneficiary has been trained so far. The SCBF project is currently operated in Azamgarh,

Bhojpur, Brahmpur, Chota Jamalpur and Harahua.

Utkarsh Welfare Foundation Financial Literacy Program

UWF Financial Literacy Program was launched in October 2015 across 9 branches in Bihar

and Madhya Pradesh. During Q1 FY 2016 – 17, a total of 5,252 beneficiaries had completed

financial literacy training through 9 branches viz. Amarpattan, Bara Chakia, Bettiah,

Gyanbabu Chowk, Maihyar, Motihari, Narkatiyaganj, Rewa and Satna. Cumulatively a total

of 11,094 beneficiary has been trained so far.

Dialogue on Business

The project has been launched in June, 2016 for MEL Varanasi Branch. The training is for

MEL clients on self-management, cash management and enterprises management. Till Jun

30, 2016, 20 clients have been trained.

In association with FMO Project-

The project has been launched in June, 2016 across 5 branches of Uttar Pradesh. Till Jun

30, 2016, a total of 371 beneficiaries had completed financial literacy training across 5

branches viz Ashok Vihar, Madiyahoo, Naupedwa, Panchkoshi, and Parmanantpur.

In the Q1 FY 2016-17, the Financial Literacy Education Program reached 8,829

beneficiaries.

Mass Awareness Program

Community Mass Awareness Camps were also conducted at village level, wherein 6,792

beneficiaries participated across 19 camps.

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Success Stories – as clients speak “…”

I am a resident of Kudra in Kaimur

district of Bihar. I still remember

the early days of hardships when

we were struggling to meet our

daily needs with our limited means

– my husband’s irregular wages

and negligible income from our

small General Store.

Things changed when I met an

Utkarsh official who motivated me

to take an income generating loan

and scale up my small business.

Now I am an active member of a JLG group, and have utilized the credit facility extended

by Utkarsh effectively.

With the initial loan of ₹ 10,000, I renovated the shop and with the subsequent loan of ₹

15,000 increased the stock available at shop. Gradually the business grew and also the

income. With this change in economic status, we are able to live a comfortable life and our

children are attending a good convent school.

Recently, I have availed a loan of ₹22,500 and expanded the business of selling vegetables

also. We have employed a helper to assist in the shop thereby also generating

employment for others.

The financial assistance from Utkarsh has not only brought an economic change in my life,

it also helped me to build a respectable position in the society.

I am economically and hence socially also empowered now. I would like to express my

gratitude towards Utkarsh for supporting me when I needed it the most. This assistance

has made it possible for me to gain my present status.

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UTKARSH in NEWS

Mr. Trilok Nath Shukla, Head - JLG Business (1st from left) as the panel member in the Seminar on "Banks role in Financial Inclusion in rural India" at Patna, Bihar on June 15, 2016.

Mr. Trilok Nath Shukla, Head - JLG Business (sitting 2nd from right) as the panel member in the seminar on “Fostering the Financial Inclusion Agenda” at Rudrapur, Uttarakhand on March 16, 2016.

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Client Meet at Mokama, Jabalpur on May 14, 2016

Utkarsh Participation in 'Fostering Financial Inclusion Agenda' Seminar

Client Meet at Baniyarpur Branch of Utkarsh Micro Finance Limited on Jun 11, 2016.

UTKARSH VOICE Q1 [FY 16 -17]: Volume-8, Issue-1

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Client Meet at Sihora, Patna on May 28, 2016 Client Meet at Booty More, Ranchi on June 11, 2016

Client Meet at Kushinagar, Gorakhpur on May 17, 2016

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Your feedback is important to us. Please write to us at:

Manager, Corporate Communication, Utkarsh Micro Finance Ltd. S2/639-56, Varuna Vihar Colony, J.P. Mehta Road, Cant., Varanasi - 221002, Uttar Pradesh E-mail ID

publications@utkarshmfi.com website www.utkarshmfi.com

2nd Batch Reward & Recognition Tour to Jaipur from June 23 to 13, 2016

1st Batch Reward & Recognition Tour to Jaipur from June 9 to 13, 2016