ICICI Bank Q3 profit rises 30% on higher NII & other income

Moneycontrol Bureau

India's largest private sector lender ICICI Bank's third quarter (October-December) standalone net profit jumped more than 30% year-on-year to Rs 2,250 crore, driven by robust net interest income, which increased 29% to Rs 3,500 crore. Other income too climbed 17% to Rs 2,215 crore adding to the profit margin. "The rise in profit came on the back of growth and efficiency parameters," Chanda Kochhar, MD & CEO, ICICI Bank told reporters in a conference call. "Going forward, we expect slight improvement in net interest margin by a few basis points. Our growth in loans is well-balanced. We would grow our retail loans at 20%. Also, there is a room for growing our international business wherein the net interest margin stood at 1.3%," she said. Analysts on an average were expecting profit after tax at Rs 2,077 crore and net interest income at Rs 3,499 crore for the quarter. The bank expanded its loans by 16% y-o-y to Rs 2.87 lakh crore while the deposits grew at a slower pace by about 10% to Rs 2.86 lakh crore. The share of current and savings account (CASA) was at 40.9% as against 40.7% in the second quarter. CASA is a source of cheap funds for banks. Net interest margin logged a rise of 37 basis points to 3.07% y-o-y. Provisions against bad loans inched up to Rs 369 as against Rs 341 crore a year back. However, the same came down in comparison with the July-September quarter recorded at Rs 508 crore. Provision coverage ratio stood at 77.7% as on December 31. "In Q2 provisions were up due to one single corporate account which we had provided for. Earlier, we had sold our credit exposure in Kingfisher airlines. Currently, we do not have any plan for selling our (stressed) loan portfolios," Kochhar said. During the quarter, the gross non-performing asset (NPA) ratio improved from 3.54% to 3.31% quarter-on-quarter. Net NPA ratio was at 0.76% compared with 0.78% a quarter back. Net restructured book remained at Rs 4,169 crore, little changed from the previous quarter. ICICI Bank, according to Kochhar, does not need to raise any equity capital in the near term. Its capital adequacy ratio was 19.53% of which tier-I (equity capital) was at 13.25% as on December 31. At 14.40 hrs, ICICI Bank shares were trading at Rs 1,196, down more than 1% on NSE. Earlier in the trading session however, those hit 52-week high of Rs 1,232 before the results announcement. "There were high hopes of better-than-expected results. Some traders were speculating on that. Though, the bank has reported good set of numbers but there is nothing to cheer about it. Some amount of profit booking has led to the fall in share price," said a banking analyst from a foreign brokerage firm. saikat.das@network18online.com Also Read
PNB thrills mkt, posts 14% profit growth on low provisions
Union Bank Q3 profit soars 38% to Rs 302 cr; shares up 6%