ICICI Bank’s net profit up 14.6% – Banking and Financial News

ICICI Bank, the country’s second-largest private lender, on Saturday reported a 14.6% year-on-year rise in net profit at Rs 11,059 crore for the June quarter, helped by strong loan growth. The lender topped market expectations as Bloomberg estimates pegged profit at Rs 10,739 crore.

Net interest income rose 7% to Rs 19,553 crore in the June quarter of the current fiscal from Rs 18,227 crore in the corresponding quarter of the previous fiscal.

The lender’s net interest margin (NIM) narrowed to 4.36% in the first quarter from 4.78% in the same quarter last year. “In the past, we were growing at a much faster pace, but given the fact that we had very benign credit costs and much higher NIM, now it is becoming more normalised. And from a banking perspective, we have to see that both advances and liabilities have grown by around 15%,” Sandeep Batra, executive director, ICICI Bank, said in a conference call on financial results. “We are happy with the progress, can we do better. Of course, we can do better,” he said.

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Total loans grew by 15.7% year-on-year and 3.3% sequentially to Rs 12.23 trillion as of June 30. The retail loan portfolio grew by 17.1% year-on-year and 2.4% sequentially and accounted for 54.4% of the total loan portfolio as of June 30.

The business banking portfolio grew 35.6% year-on-year and 8.9% sequentially as of June 30. The SME business, comprising borrowers with turnover below Rs 250 crore, grew 23.5% year-on-year and 4% sequentially as of June 30. The domestic corporate portfolio grew 10.3% year-on-year and 3.1% sequentially as of June 30. The bank’s deposits grew 15.1% year-on-year and 0.9% sequentially to Rs 14.26 trillion as of June this year.

Commenting on the Reserve Bank of India’s draft LCR norms, Batra said the guidelines will have an impact on the cost of deposits, credit growth, lending rates and return on investments.

The bank improved its asset quality as the gross non-performing assets (NPA) ratio came down to 2.15% as of June 30 this year from 2.16% as of March 31. The net NPA ratio stood at 0.43% as of June 30 compared with 0.42% as of March 31. Provisions for bad loans rose marginally to Rs 1,332 crore in the first quarter as against Rs 1,292 crore in the same quarter of the previous fiscal.

Recoveries and write-downs of non-performing assets, excluding write-offs and sales, stood at Rs 3,292 crore during the quarter as compared to Rs 3,918 crore in the fourth quarter of the previous financial year.

After opening 64 branches in the first quarter, at the end of June this year the bank had a network of 6,587 branches and 17,102 ATMs and cash recycling machines.

ICICI Bank infused Rs 500 crore into its home finance subsidiary, ICICI Home Finance, in the first quarter of FY25, the bank’s executive director (ED) Sandeep Batra said. Till now, the bank has infused Rs 1,862 crore through equity into the subsidiary.