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Retail loans buoy ICICI

Mumbai, April 25: Backed by a strong growth in retail loans, ICICI Bank today reported a 15 per cent rise in net profit for the fourth quarter ended March 31, 2014, beating analyst estimates.

The country’s largest private sector bank posted a net profit of Rs 2,652 crore against Rs 2,304 crore in the same period a year ago.

Analysts had expected the bank to record a net profit of around Rs 2,500 crore.

While net interest income (NII) rose 15 per cent to Rs 4,357 crore from Rs 3,803 crore, its non-interest income also contributed to the good show. NII, considered a bank’s core income, is interest earned minus interest paid.

Non-interest income increased 35 per cent to Rs 2,976 crore (Rs 2,208 crore). Fee income grew 12 per cent to Rs 1,974 crore, treasury income stood at Rs 245 crore, while dividend from subsidiaries was placed at Rs 541 crore. Exchange rate gains contributed Rs 222 crore.

Commercial banks have been concentrating on their retail loan book in recent times as the economic slowdown has resulted in higher bad loans in the corporate sector.

During the quarter, advances grew 17 per cent at Rs 338,703 crore from Rs 290,249 crore on March 31, 2013. ICICI Bank said it continued to see healthy growth in its retail disbursements which has translated into a year-on-year growth of 23 per cent in this segment.

Savings account deposits increased Rs 3,408 crore and current account deposits, Rs 1,804 crore. On March 31, 2014, savings account deposits were Rs 99,133 crore and current account deposits stood at Rs 43,245 crore. The bank’s low-cost CASA ratio was 42.9 per cent, lower than 43.3 per cent in the preceding quarter.

However, there was some disappointment on the asset quality front with gross non-performing assets (NPAs) in absolute terms rising to Rs 10,506 crore from Rs 9,608 crore in the corresponding previous period.

Further, though the gross non-performing assets ratio was flat on a sequential basis at 3.03 per cent, the lender witnessed fresh slippages of Rs 1,241 crore.

The bank wrote off Rs 700 crore of bad assets during the fourth quarter, Chanda Kochhar, managing director & CEO, told reporters during a conference call.

Provisions for bad assets jumped to Rs 714 crore in the fourth quarter from Rs 460 crore a year ago.

The bank also added Rs 2,156 crore to its restructured assets, taking the total recast book to Rs 10,558 crore.

 
 
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