Dear Shareholders

We, along with other SFBs, started the banking journey five years back. These five years have been a mixed bag with several achievements and learnings. All of us have been able to create a deposit book to match asset side, invest in IT and robust banking platform, create new highs in financial inclusion. However, cost and profitability has been a challenge due to the transformation as well as external shocks like demonetisation and COVID.

Financial year 2021-22 was marked by challenges with dynamic changes in the Board, Management, Work Force, Market Value etc. However, we ended the year on a high with a remarkable turnaround and record-breaking business numbers in second half of the fiscal. I would take this opportunity to thank all the shareholders who trusted us through these challenging times. Our Board has witnessed considerable changes during the year, and Mr. Ittira Davis, a seasoned banker took charge as the MD & CEO of the Bank effective from January 14, 2022, with the prior approval of the RBI. Further, after the induction of the new Board members during the year, we are glad that the present Board of the Bank comprises of experienced professionals totally committed to help achieve our mission to be the best digital mass market Bank. In addition, to further strengthen our Board, the Bank recently has appointed Ms. Anita Ramachandran, a veteran HR expert as an Independent Director. This brings the total number of female Board Members to 30% of the total.

The Bank started its journey towards the turnaround with three-fold objectives of rebuilding business volumes, improving asset quality and reducing credit cost and attracting good talent to further stabilise our team. In order to achieve these objectives, the Bank formulated two “100-Day Plans” in the third and the fourth quarter and the combined efforts of the Board, the Management and our entire workforce made the turnaround possible. The Bank recorded a pre-provisioning operating profit of ₹217 Crores in the last quarter. Further, with COVID fear receding and the economy gradually normalising, we’re seeing a good credit demand. This is visible from all-time highest gross disbursements and growth in advances in the second half of the last fiscal. Overall, I am confident that FY 2022-23 will be a strong comeback year for Ujjivan where new milestones will be achieved which will create a solid platform for next growth cycle. The Board will provide all support and guidance to the management in this next interesting phase of the cycle to help achieve the required stability and consistent desired profitability.

Further on the talent front, despite the high attrition that we faced in the beginning of the year, we have been progressing well on attracting good talent at all levels. Our Management team has been strengthened by joining of senior leaders with vast experience and the attrition at the other levels has also come under control with the help of various HR initiatives.

I would also like to highlight certain other important initiatives taken by the Bank. In order to ensure safety of our customers as well, after extending the vaccination drive to cover 99%+ of our employees and families, we launched an initiative to help our customers and families get vaccinated. In the FY 2021-22 the Bank’s CSR activities were also focused on COVID relief and healthcare. In addition to the same, our community development programme, Chote Kadam in partnership with Parinaam Foundation carried out 5 civil projects in Karnataka, Goa, Rajasthan and Gujarat for the benefit of the underprivileged communities. We have partnered with skill development NGOs like Cheshire Disability Trust, Divya Nur Foundation and Savera society towards the training and placement of youths and women in Maharashtra, Jharkand, Orissa and Bihar. We also adopted an education centre in Chennai which is run for children of Persons with Intellectual and Developmental Disability (PwIDD).

During the year, the Bank initiated necessary steps for the reverse merger of Ujjivan Financial Services Limited, the Holding Company (UFSL) with the Bank in accordance with applicable laws and guidelines. As mandated by SEBI, the Bank is in process to increase its public shareholding to at least 25% by way of Qualified Institutions Placement, after which the merger application will be submitted with the stock exchanges and other regulators. Further, the Bank is also exploring a debt issue (sub-ordinated debt eligible for Tier II Capital) since augmenting the capital is necessary for the Bank to grow in line with its budgeted growth rate in the current financial year.

FY 2022-23, I believe, looks encouraging for the industry, and Ujjivan especially, to reap the benefits of the hard work put in over the last five years. Economy is gradually recovering from the COVID impact. Our target customer segment is resilient and is bouncing back with strong credit demand. We are confident that the momentum built in the second half of FY 2021- 22, would continue in the current fiscal and would enable Ujjivan to attain newer heights in terms of growth, size, deposit mobilisation and profitability.

We are optimistic that the Bank has the potential to grow exponentially, and we are hopeful that the long-standing shareholders will appreciate the overall performance and be rewarded in the years to come.

Mr B.A Prabhakar
Chairman