Yes Bank – July 21, 2009

Yes Bank
Treasury income steals the show
Core income in line with expectation: Yes Bank reported Q1FY10 at Rs1.0bn up
84.2% YoY which was significantly higher than our estimates. This was led by
237% YoY increase in treasury income at Rs850m. The other positive takeaways
were 10bps improvement in NIMs on QoQ basis and ~27% reduction in GNPAs and
NNPAs QoQ. Tier I capital adequacy stands at robust 10.3% puts the bank in a
very strong position to benefit from the economic recovery going forward.
NII improvement led by margin expansion despite muted asset growth: Total
assets declined by 5.5% QoQ with deposits and investments declining 5.1% and
9.9% respectively. Cost of funds declined by 70bps QoQ as the bank retired
significant high cost deposits translating to 20bps YoY and 10bps QoQ margin
improvement.