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India Research<br />
Chart 7: <strong>Syndicate</strong> <strong>Bank</strong>’s margin, Risk-adjusted<br />
margins (%)<br />
Source : Company, Dolat Research<br />
DOLAT CAPITAL<br />
� Core interest in<strong>com</strong>e strengthen: The bank managed to maintain margin<br />
even in a difficult scenario mainly on the back of stability on low-cost deposits<br />
share with decrease in bulk deposit proportion on liability side and marginal<br />
increase in exposure to riskier assets (reflecting into sharper increase in credit<br />
risk). On liability side, the bank managed to contain rise in costs and on asset<br />
front, it improved yields with credit portfolio rebalancing in favor of term loans<br />
and high-yielding advances. The bank’s RWAs/assets ratio increased to 53.6%<br />
from 51% a year back. The bank’s margin improved by 4bps to 3.06%.<br />
Chart 8: <strong>Syndicate</strong> <strong>Bank</strong>’s cost of deposit and yields<br />
(%)<br />
� Rating & risk weight of credit book: <strong>Syndicate</strong> <strong>Bank</strong>’s proportion of unrated<br />
credit book slightly increased to 53% from 51% a year back and share of unrated<br />
credit book (with more 100% risk weight) remained almost constant at 5.9%.<br />
July 13, 2012 <strong>Syndicate</strong> <strong>Bank</strong><br />
8
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