ICICI Bank Q3 Results: Net Profit Rises 25% On Higher Interest Income

ICICI Bank Ltd.'s quarterly profit rose in the third quarter, beating estimates, aided by higher interest income and lower provisions.

Net profit rose 25.4% year-on-year to Rs 6,194 crore, the private lender said in its exchange filing. Analysts polled by Bloomberg had estimated a net profit of Rs 5,800 crore in Q3 FY22.

Net interest income, or core income, increased 23% year-on-year to Rs 12,236 crore. Other income rose 25% over the preceding year period to Rs 4,899 crore. Net interest margin for the third quarter stood at 3.96%, marginally lower than 4% reported in the Jul-Sep quarter.

The lender's asset quality improved, with gross non-performing asset ratio falling 69 basis points sequentially to 4.13% as of Dec. 31, 2021. Net NPA ratio too dropped 14 basis points quarter-on-quarter and stood at 0.85%. This is the bank's lowest net NPA ratio since Mar 2014, it said.

ICICI Bank added bad loans worth Rs 4,018 crore during the October to December quarter, as compared with Rs 5,578 crore added in Q2 and Rs 7,231 crore added in Q1. Of the reporting quarter's slippages, Rs 3,853 crore came from the retail book.

Recoveries and upgrades during Q3 stood at Rs 4,209 crore, higher than the slippages. The bank also wrote off loans worth Rs 4,088 crore during the third quarter.

"We are confident of the portfolio that we have built," said Sandeep Batra, executive director, ICICI Bank, without providing any guidance on asset quality.

Provisions for the quarter stood at Rs 2,007 crore, down 27% year-on-year.

"We hold Covid-related provisions worth Rs 6,400 crore. As the situation with respect to the third wave becomes clearer, we will see what we need to do with this," Batra said. "Our balance sheet is fully cushioned against any future impact of the third wave."

ICICI Bank Q3 Highlights

• Total advances rose 16% year-on-year to Rs 8.14 lakh crore. Domestic advances rose 18% year-on-year.

• The bank's retail book rose 19% year-on-year and constituted 61.3% of the total loan book. The domestic wholesale banking book rose 13% year-on-year.

• The business banking portfolio rose 39% year-on-year.

• Total deposits rose 16% year-on-year to Rs 10.17 lakh crore. In this, total term deposits rose 12% year-on-year to Rs 5.37 lakh crore.