The billionaire NRI businessman invests in three banks in his home state
Yusuffali MA, the chairman of Lulu Group and the richest Malayali, has increased his stake in three Kerala-based banks, namely Federal Bank, Catholic Syrian Bank (CSB Bank), and Dhanlaxmi Bank. He has invested close to Rs. 510 crore in just the banking sector in Kerala, according to a statement by the Lulu Group.
Yusuffali said that his investment is with a view to further strengthen the Kerala-based banks and to make them more competitive. He also said that opening more branches in Kerala and the Gulf region and upgrading the efficiency will create more employment opportunities and strengthen the state economy.
Yusuffali holds 5% stake in each bank
Yusuffali has acquired 4.99% share of Thrissur-based Dhanlaxmi Bank, which is valued at Rs. 37.3 crore. He had earlier acquired close to 5% stake each in Federal Bank and CSB Bank this year. His 5% ownership in Federal Bank is worth Rs. 339.5 crore, while his 2.17% stake in CSB Bank is worth Rs. 133.97 crore.
Yusuffali is known for his diversified business interests, ranging from retail, hospitality, real estate, food processing, to healthcare. He is the richest Malayali with a net worth of $5.3 billion (Rs. 43,600 crore), ranking 22nd richest Indian, according to the latest Forbes global billionaires list. He has also announced major investments in the hospitality sector in Kerala, which include the Grand Hyatt Hotel and convention centre in Bolghatty in Kochi.
Kerala-based banks benefit from Yusuffali’s backing
The investment by Yusuffali is seen as a boost for the Kerala-based banks, which have been facing challenges in the competitive banking sector. The banks have been trying to improve their performance, profitability, and governance in recent years.
Federal Bank, the largest among the three, has reported a net profit of Rs. 478.6 crore for the quarter ended September 30, 2023, up by 13.8% from the same period last year. The bank has also improved its asset quality, capital adequacy, and digital initiatives.
CSB Bank, which was formerly known as Catholic Syrian Bank, has posted a net profit of Rs. 69.1 crore for the quarter ended September 30, 2023, up by 41.4% from the same period last year. The bank has also witnessed a growth in its deposits, advances, and net interest income.
Dhanlaxmi Bank, which has been under the Reserve Bank of India’s (RBI) prompt corrective action (PCA) framework since 2015, has registered a net profit of Rs. 6.9 crore for the quarter ended September 30, 2023, compared to a net loss of Rs. 44.9 crore in the same period last year. The bank has also reduced its non-performing assets (NPAs) and improved its capital adequacy ratio.