ICICI Bank Q4 Net Profit Rises To Rs 4,402 Crore
ICICI Bank’s net profit rises more than 260% year-on-year as interest income rises.
Private sector lender ICICI Bank Ltd. saw its net profit rise sharply over a year ago as core income improved and provisions were lower compared to a year ago.
The bank’s net profit rose 260.5%, year-on-year to Rs 4,402 crore. A year ago, the bank has stepped up provisions against standard assets, which had depressed profits. Net interest income, or core income, rose 16.8% from a year ago to Rs 10,431 crore for the bank. Other income fell to Rs 4,111.35 crore from Rs 4,255 crore.
The bank set aside Rs 175 crore from its net interest income to refund borrowers after the Supreme Court ordered that all lenders must receive such refunds for interest-on-interest charged between March-August 2020, when the Reserve Bank of India’s loan moratorium was in effect. Each bank will make such refunds.
Analysts polled by Bloomberg estimated a net profit of Rs 4,281 crore and a net interest income of Rs 10,061 crore for the fourth quarter.
Asset Quality Picture
ICICI Bank’s gross non-performing asset (NPA) ratio stood at 4.96%, as compared with 5.42% in the October-December quarter. Net NPA ratio improved by 12 basis points on a sequential basis to 1.14% in the Jan-Mar quarter.
Provisions during the fourth quarter stood at Rs 2,883.47 crore, down 51.7% from last year. The amount is marginally higher on a sequential basis. The bank disclosed that it has restructured loans worth Rs 1,976 crore under the one-time restructuring scheme. This includes:
- Corporate: 30 borrowers with dues of Rs 1323 crore
- Retail: 1,586 borrowers with dues of Rs 643 crore
The bank is comfortable with the quality of underwriting, said executive director Sandeep Batra, on a conference call with reporters after the results were declared.
“We believe that the Indian corporate and SMEs (small and medium enterprises) are more resilient now than last year. We have been conducting regular stress tests on our book and are comfortable with the book and the quality of its underwriting,” Batra said.
New Business
- Total advances rose 13.7% to Rs 7.34 lakh crore
- Retail loans rose 20% to Rs 4.9 lakh crore
- Domestic corporate and other advances rose 10% to Rs 1.77 lakh crore
Retail loans now account for nearly 67% of the bank’s loan book.
Loans to small and medium enterprises rose 32.5% from a year ago to Rs 30,284 crore. The bank disclosed that it had disbursed Rs 12,700 crore worth of loans to small businesses under the first iteration of the emergency credit linked guarantee scheme of the government. The bank has also disbursed loans worth Rs 1,500 crore under the ECLGS 2.0 scheme, where stressed firms were also included.
Among retail loans, loans to rural customers rose 27% year-on-year to Rs 72,158 crore, the fastest segmental growth rate. The bank’s home loan book stood at Rs 2.44 lakh crore, up 22% from a year ago.
ICICI Bank’s credit card portfolio rose 10.6% year-on-year to Rs 17,311 crore. The bank has stepped up credit card issuances and cornered most of the incremental cards issued since December 2020, as competitor HDFC Bank has been forced to stay out of the market due to regulatory orders, BloombergQuint had reported earlier.
“We are happy to acquire new customers on a risk calibrated basis. We will continue to be fair to customers as well as our shareholders, as far as risk taking is concerned,” Batra told reporters.
Total deposits rose 21% year-on-year to Rs 9.3 lakh crore. Of this, low cost current account savings account deposits rose 24% to Rs 4.3 lakh crore. CASA deposits now account for 42.5% of total deposits, as compared with 42.3% a year ago.