BWI: Housing Development Finance Corporation Limited: Chairman's Speech

Press release from Business Wire India
Source: Housing Development Finance Corporation Limited
Wednesday, July 22, 2009 04:28 PM IST (10:58 AM GMT)
Editors: General: Economy; Business: Accounting & management consultancy services, Banking & financial services, Business services, Financial Analyst, Real estate, Stock exchanges
--------------------------------------------------
Housing Development Finance Corporation Limited: Chairman's Speech


Mumbai, Maharashtra, India, Wednesday, July 22, 2009 -- (Business Wire India) -- Dear Shareholders,

Good Afternoon and on behalf of the Board of Directors, I welcome you all to the 32nd Annual General Meeting of your Corporation.

Review of Corporate Performance in FY 2008-09

Loan approvals and disbursements

Last year, your corporation approved loans amounting to Rs. 49,166 crores as compared to Rs. 42,520 crores in the year 2007-08, representing a growth of 16% and disbursed loans amounting to Rs. 39,650 crores as against Rs. 32,875 crores during 2007-08 representing a growth of 21%. as at march 31, 2009, cumulative loan approvals were Rs. 2,37,450 crores and cumulative loan disbursements stood at Rs. 1,91,806 crores in respect of over 3.3 million housing units.

The demand for individual home loans continued despite the overall economic slowdown and uncertainty. The average size of individual loans has increased and stood at Rs. 15.40 lacs.

Recoveries

Gross Non-performing loans, defined as loans where installments are outstanding for more than 90 days as at March 31, 2009 stood at Rs. 701.55 crores. This is equivalent to 0.81% of the loan portfolio as compared to 0.84% of the loan portfolio during the previous year.

As per the prudential norms prescribed by NHB, HDFC is required to carry a provision of Rs. 319.40 crores in respect of non-performing assets and general provision on outstanding standard non-housing loans. The balance in the provision for contingencies account as at March 31, 2009 stood at Rs. 621.53 crores, which is equivalent to 0.72% of the loan portfolio.

Capital Adequacy Ratio

As at March 31, 2009, your corporation's capital adequacy ratio stood at 15.1% of the risk weighted assets as against a minimum requirement of 12%. Tier I capital stood at 13.2% as against a minimum requirement of 6.0%.

Financials

For the year ended March 31, 2009, your corporation's profit before considering profit on sale of investments and exceptional items and tax stood at Rs. 3,193.81 crores as compared to Rs. 2,603.98 crores for the previous year. After providing Rs. 934.98 crores for taxes, the net profit after tax for the year ended March 31, 2009 increased by 23% to Rs. 2,258.83 crores as compared with Rs. 1,834.55 crores in the previous year.

The total profit before tax for the year ended March 31, 2009 stood at Rs. 3,219.04 crores. After providing Rs. 936.50 crores for taxes, the profit after tax stood at Rs. 2,282.54 crores.

The spread on loans stood at 2.21% per annum. Your corporation's cost to income ratio stood at 8.8% for the year ended March 31, 2009 as against 9.2% in the previous year and continues to be amongst the lowest in the financial sector in Asia.

The board of directors of your corporation has recommended a dividend of Rs. 30 per equity share of Rs. 10 each. The payment of dividend if approved, will commence from tomorrow. The dividend for the last year was rs. 25 per equity share of Rs. 10 each.

Current Year's Performance

Loan approvals during the quarter ended June 30, 2009 amounted to Rs. 12,259 crores as compared to Rs. 9,996 crores in the corresponding period last year, representing a growth of 23%. Loan disbursements during the quarter ended June 30, 2009 amounted to Rs. 8,688 crores as compared to Rs. 7,204 crores in the corresponding period last year, representing a growth of 21%.

On a sequential quarter basis, the growth in individual loan approvals and disbursements for the first quarter of this financial year has been 45% and 19% respectively as compared to the quarter ending March 31, 2009.

The financial results of your corporation for the quarter ended June 30, 2009, which has been subject to limited review by the auditors, were approved by the board at its meeting held earlier today.

For the quarter ended June 30, 2009, your corporation reported a profit before tax of Rs. 779.92 crores as compared to Rs. 649.86 crores in the corresponding quarter of the previous year - an increase of 20%.

After providing Rs. 215 crores for tax, the profit after tax for the quarter amounted to Rs. 564.92 crores, as compared to Rs. 468.11 crores in the corresponding quarter of the previous year - an increase of 21%.

Recent Developments

Issue of warrants with secured redeemable non-convertible debentures to qualified institutional buyers on a qualified institutions placement basis

The corporation is in the process of undertaking a qualified institutions placement (QIP) offering of warrants simultaneously with secured redeemable non-convertible debentures to qualified institutional buyers (QIBS). The warrants can be exchanged at the option of the warrant holder at a later date for a maximum of 1,09,53,706 equity shares of Rs. 10 each, constituting up to 3.5% of the expanded issued and paid up equity share capital of the corporation. The secured redeemable non-convertible debentures will not exceed Rs. 4,000 crores. the issue will be made in accordance with chapter xiii-a of the SEBI dip guidelines. The funds are required for augmenting the long term resources of the corporation.

A committee of directors of the corporation had approved the said proposal at its meeting held on June 9, 2009, subject to receipt of requisite approvals.

On receipt of your approval and other requisite approvals, the board will meet to decide the terms and conditions of the said issue.

Annual Report of Subsidiary Companies

The annual report of the corporation does not contain the annual accounts of its subsidiary companies in terms of the exemption granted by the central government under section 212(8) of the Companies Act, 1956.

The said exemption was sought only to save on printing and postage cost. However, the corporation has made arrangements to dispatch the annual report of subsidiary companies to shareholders on request.

Payment of Dividend

Pursuant to your approval, the posting of dividend warrants for the financial year 2008-09 will commence tomorrow.

Shareholders having their bank account with hdfc bank limited will receive dividend through the direct credit system tomorrow.

Shareholders who have given the mandate to receive dividend through the electronic clearing service will get credit of the dividend amount in their bank account within a week.

Shareholders' special offer on deposits

As a special gesture, the corporation is once again offering an attractive deposit product exclusively for the benefit of individual shareholders.

Under this offer, the interest payable on the deposits will carry an additional rate of up to 50 basis points over the prevailing interest rates.

The forms are available at our offices and the deposit counter at the entrance of the hall. I hope you will participate in the special offer. This special offer is valid till August 31, 2009.

Conclusion

Before I conclude, I wish to place on record our appreciation to all our shareholders, customers, depositors, lenders and regulatory authorities for having reposed their confidence in the corporation and to our employees for their excellent performance and sincere service.

To view the documents, please click on the links given below:

Quarter June 2009 Analyst

June 2009
For picture(s)/data to illustrate this release click below:

http://www.BusinessWireIndia.com/attachments/Qtrjun09-analyst.doc
Qtrjun09-analyst.doc
http://www.BusinessWireIndia.com/attachments/jun09.xls
jun09.xls


CONTACT DETAILS
Mahesh Shah, Housing Development Finance Corporation Limited, +91 (22) 66316410, maheshs@hdfcindia.com

KEYWORDS
ECONOMY, CONSULTANCY SERVICES, BANKING, BUSINESS SERVICES, Financial Analyst, REAL ESTATE, STOCK EXCHANGES, 500010.BO, HDFC.NS

If you wish to change your Business Wire India selection please click on this link http://www.businesswireindia.com/media/news.asp and use your personal username and password to login.

Submit your press release at http://www.businesswireindia.com