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Asset worry mars ICICI strong show

Mumbai, Jan. 29: ICICI Bank today met Street estimates by reporting a 13 per cent rise in net profit for the third quarter ended December 31 at Rs 2,532 crore against Rs 2,250 crore in the year-ago period.

However, the country’s largest private sector bank witnessed a jump in bad loans and the number of restructured accounts.

Gross NPAs during October-December rose to Rs 10,399.13 crore from Rs 10,028.45 crore in the preceding quarter and Rs 9,763.39 crore in the same period last year.

As yet, private sector banks have scored over their nationalised peers with respect to non-performing assets (NPAs).

ICICI also saw a rise in restructured loans and the number of fresh accretion to bad loans. During the quarter, the bank restructured Rs 2,046 crore, higher than Rs 1,076 crore in the year-ago period.

After taking into account deletions and the required specific provisioning, net restructured loans increased to Rs 8,602 crore from Rs 6,826 crore as on September 30. Moreover, slippages grew to Rs 1,230 crore (Rs 1,000 crore).

In a conference call after the results, senior officials of the bank said it could restructure more accounts in the present quarter.

The bank’s corporate debt restructuring pipeline continues to remain high. At present, it has loans of around Rs 3,000 crore referred for restructuring.

Reacting to the news on poor asset quality, the ICICI Bank scrip ended lower on the stock exchanges. On the BSE, the share finished with a loss of 1.69 per cent at Rs 1,001.95.

Net profit of the company rose largely on the back of a strong rise in retail advances.

Total advances increased 16 per cent on a year-on-year basis to Rs 332,632 crore on December 31 from Rs 286,766 crore a year ago.

The bank said it continued to witness healthy growth in retail disbursements, which resulted in a 22 per cent growth in the total retail portfolio as on December 31.

Home loans account for close to 55 per cent of the bank’s retail book followed by vehicle loans at 21.2 per cent.

The quarter saw low-cost savings account deposits rising by Rs 2,190 crore and current account deposits, Rs 1,068 crore.

According to the bank, its current account and saving account (CASA) ratio was stable at 43.3 per cent in December.

 
 
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