Business Solutions to Development Challenges

Responsible Banking @ YES BANK

Responsible Banking @ YES BANK

Business does not operate in a vacuum

Integrating social and environmental aspects into core business strategy important for long-term growth of the Bank

Responsible Banking means adopting a People-Planet-Profit approach to doing business

Translates into a critical competitive edge for the Bank

Offers inroads to new business segments and client base

Mainstreaming sustainability using multi-stakeholder approach Operate in Sustainability Zone supporting businesses that meet economic, environmental &

social objectives Innovative financial solutions to address gamut of development issues sustainable

livelihood, food security, climate change, public health, education, information technology,biotechnology etc

Using knowledge driven approach and specialised skill sets, human resources to adaptcommercial financial services to sustainability space.

YES BANK has leapfrogged traditional philanthropy-based CSR to Responsible Banking finding Business Solutions to Social & Environmental Issues

Sustainability Zone combined economic, environmental, social benefit

Pure Philanthropy

Pu

re P

rofit

Sustainability Zone Evolution of Sustainability

Values over Value

Sustainability:

Triple Bottom

Line

New Generation

of Sustainability:

Integration and

Mainstreaming

Philanthropy focused

CSR based initiatives

Sustainability as part of business

Responsible Banking A Differentiated Approach

Responsible Banking Framework

Responsible Banking in ActionResponsible Banking in Thought

YES COMMUNITY

Responsible Corporate Citizenship

(RCC)

Other Bank Divisions:

Corporate Finance

Corporate & Institutional Banking

Commercial Banking

Business Banking Retail Branches

Alternative Energy &

Environment

SUSTAINABLE INVESTMENT BANK (SIB)Business Planning/Structuring,

M&A Advisory, Private Placement

Clean & Sustainable

Technologies

Deal Generation

Internal Engagement

Deal Generation

MICROFINANCE Credit + Services

RESPONSIBLE BANKING (CSR & Sustainability)

Thought Leadership, Advisory, Institutionalization

SOCIALLY RESPONSIBLE

INVESTING Growth Capital

AGRI & RURAL BANKING (ARB)

Credit + Services

Social Enterprises

INCLUSIVE & SOCIAL

BANKING Credit, Savings,

Remittances

BusinessCorrespondent

Deal Generation

Responsible Banking: Mainstreaming sustainability principles across YES BANK

A Think Tank incubating new business opportunities to mainstream sustainability

Provides thought leadership

Establishes partnerships for development - local and international

Supports the socially responsible investor community by innovating

business approaches to development.

Provides Responsible Corporate Citizenship advisory services to businesses, governments and non-profits for

Social Auditing

Strategizing CSR practices

Socio-environmental engagement

Waste management

Human capital and employee support analysis

Carbon emissions analysis

Social enterprise planning and scalability

Entrepreneurship development and syndication of funds

Responsible Banking in Thought

RESPONSIBLE CORPORATE CITIZENSHIP

CASE STUDY

Malnutrition Matters Vita Goat

Responsible Corporate Citizenship advisoryCase study

Development challenge

Addressing malnutrition and inducing economic growth at the Bottom of

the Pyramid

Responsible Banking has partnered with Malnutrition Matters (MM), a

Canadian non-profit organization that designs food processing systems

The VitaGoat is a low cost, soy-processing system developed by MM to both

combat malnutrition and provides livelihood opportunities

YES BANK role

Providing inputs for the Indian context

Facilitating MMs expansion in India and access to

suitable partners (technology transfer agent)

Strong network and linkages to assist program

execution (government, suppliers, development

organizations, businesses)

Business inputs for scale and sustainability

Combating poverty and malnutrition

VitaGoat as a tool

The VitaGoat consists of four components: cycle-

grinder, boiler, cooker and press.

Operates without electricity or running water,

producing a variety of foods; employs a bicycle-

powered grinder and a wide variety of locally

available fuels to prepare protein-rich soy products

One VitaGoat can provide a daily serving of soy

products for 500 to 1000 people; 3-6 people can be

employed per system

Soy foods are an excellent source of protein and

iron and a lower cost alternative to dairy products

(typically 1/3 to of the cost of dairy milk)

The VitaGoat can process a variety of soy-derived

foods, including soymilk, tofu, soy-yogurt; can also

be used to make other foods such as vegetable and

fruit juices and pastes, groundnut butter, ground

coffee beansSchool children in Orissa drinking soy milk processed by a VitaGoat

VitaGoat deployed at Buldana Urban Co-operative Credit Societyrun residential school since 2007

700 school children fed with soy milk/paneer

Facilitated a development partnership between Vigyan Ashram (anNGO near Pune oriented to technical development) and MM todevelop an ultra low-cost soymilk system for small entrepreneurs,enabling greater outreach

Expansion to Rajasthan with the delivery of first VitaGoat to SevaMandir (large NGO based in Udaipur) in Jan 2010

Expected to serve ~300-400 people per day

Targeting income generation using the VitaGoat

Project resultsYES BANK as Technology Transfer Agent

Seva Mandir employee

using the VitaGoat to grind Soybeans

Business case

Responsible Bankings partnership with Seva Mandir has strengthened the bankingrelationship

Seva Mandir placed a FD of INR 75 lakh with the Udaipur branch

Facilitating outreach to target clients for YES BANKs other business units

Collaboration with Agro Tech Foods Limited (a target client for ARSB) for their CSRprogram Feeding Children Better

Agribusiness, Rural & Social Banking

Innovative financial models

Leveraging outreach of stakeholder in Agri Value Chain to overcome last mile issues

Customized insurance solutions

Select Partners:

Reaching over 1 million Farmers through these Partnerships

Zameen Organic Pvt. Ltd Fair trade supported company owned by Small Farmers

Organizations

Network of 6,000 small farmers producing organic cotton in the Vidharbha (Maharashtra) and Adilabad (Andhra Pradesh) regions

Provides vital processing and marketing linkage between organic farmers and branding companies

Unique concept of Premium: Farmer Premium and Community Premium

Financing Innovative AgribusinessDeal Example

YES BANK is Zameens Sole Banking Partner

Institutes specific transactions to position microfinance as a new asset class,appealing to a broad base of investors and lenders, expanding access to capital

FIRST Indian bank to undertake innovations in capital market products formicrofinance:

Capital Market Products

Banks have been main source of debt funding for MFIs (term loans)

Term loans are relatively expensive they are illiquid

YES BANK arranged first rated bond issuance of an MFI in the world inthe form of Commercial Paper & Non-Convertible Debentures of INR2000 mn (USD 40 mn)

Enabled cost reduction for the MFI to the extent of 300 bps

Structured Products

Securitisation of receivables originated by MFI

MFI receivables recognised as an asset class

Generated interest among institutional investors

Potential incremental access to capital for industry of USD 12-14bn annually, impacting 60-70mn clients

Microfinance Institutions GroupMultiplier Effect: The Indirect Impact

M&A Advisory

JV Advisory

Business Restructuring

Private Equity Raising

Sustainable Investment Banking (SIB)

M&A Advisory

Business Restructuring

Private Equity Raising

56% of the 700 million rural Indian residents lackaccess to electric power; Government wants todeliver electricity to all of them by 2012 50% of itfrom renewable resources (wind, power, solar &biogas)*

YBL focused on addressing Indias energydeficiency & reducing reliance on fossil fuelsthrough thrust on renewable energy

Raised USD 47 mn for Greenko, a renewableenergy player, through private placement ofequity shares with Global Environment Fund, oneof the worlds largest environment focused funds,for expansion of their hydro power generationassets

*Source: Pernick, R. & Wilder, C (2007) The Clean Tech Revolution, Harper Collins

Renewable EnergyDeal Example

Successfully Positioned

Emerging Markets Sustainable Bank of the Year for Asia2008 for excellence in creating environmental, social andfinancial value across its operations.

Best Corporate Social Responsibility Practice Award, Socialand Corporate Governance Awards, 2007, in recognition ofinnovative strategies to implement CSR practices within thebusiness focus of the Indian Corporate sector.

Trade Finance Deal of The Year, 2007 in recognition ofinnovative structured rural financing solutions.

Environment Leadership Award, in recognition ofoutstanding contributions made through working inpartnerships to improve the environment and quality of lifefor the people of Asia.

The first bank to be recognized by the CII-ITC SustainabilityAwards in 2009

RESPONSIBLE BANKING &

BRANCH BANKING

Doing Business with Responsibility

YES COMMUNITY A Differentiated Offering

Responsible Banking & Branch Banking

Collaboration

Current theme Planet Earth

Using fun-filled, interactive & inclusive micro-

events to engage with community

Began with 15 branches in 2006, scaled up to 96 in

2010

Implemented events around sub-themes

Recycling and Minimizing Waste

Conserving Energy

Pollution Prevention

Conserving Water

Improving Sanitation and Cleanliness

Doing Business while being Socially Responsible

YES COMMUNITY Success Stories

YBL & CEE -

"Earth provides enough to satisfy every man's need, but not every

man's greed." --Mahatma Gandhi

THANK YOU