ICICI Bank Q1FY25 net profit up 15% at ₹11,059 crore
ICICI Bank reported a 15 per cent year-on-year (y-o-y) increase in first quarter (Q1FY25) standalone net profit at ₹11,059 crore on the back of moderate growth in net interest income (NII) and robust growth in other income.
India’s second largest private sector bank had reported a net profit of ₹9,648 crore in the year-ago quarter. Net interest income (interest earned less interest expended) in the reporting quarter was up 7 per cent y-o-y at ₹19,553 crore (₹18,226 crore in the year ago period).
Other income, including fee-based income, treasury income and recovery in written-off accounts, rose 29 per cent y-o-y to ₹7,002 crore (₹5,435 crore).
The net interest margin declined to 4.36 per cent in Q1FY2025 compared to 4.78 per cent in Q1FY2024
Sandeep Batra, Executive Director, said, “We would like to grow in a risk-calibrated fashion…We have seen healthy deposit growth and the loan growth has been in line with this.” Noting that the dynamics of new the LCR (liquidity coverage ratio) guidelines will come into play from next fiscal year, Batra said, “I think, the concern essentially emanates from the possibility of deposit outflows in a digital banking environment…Yes, it will have an impact on deposit costs, loan growth and lending rate. But, it is very difficult to assess the impact right now.”
Operating profit (profit before provisions and contingencies) increased by 13 per cent y-o-y to ₹16,025 crore (₹14,139 crore). Non-tax provisions nudged up 3 per cent y-o-y to ₹1,332 crore (₹1,292 crore). Tax expenses were up 14 per cent y-o-y at ₹3,634 crore (₹3,198 crore).
The bank’s asset quality showed improvement. As at June 30, 2024, the percentage of gross non-performing customer assets (net of write-off) to gross customer assets position improved to 2.15 per cent from 2.76 per cent in the year ago period.
The percentage of net non-performing customer assets to net customer assets position too improved to 0.43 per cent from 0.48 per cent.
However, fresh slippages at ₹5,916 crore (including ₹5,732 crore from retail, rural and business banking) in the reporting quarter were relatively higher vis-a-vis preceding quarter’s ₹5,139 crore.
Deposits increase
As at June-end 2024, deposits increased by 15 per cent y-o-y to stand at ₹14,26,149 crore. Average current account and savings account (CASA) ratio declined to 39.6 per cent in Q1FY25 from 42.6 per cent in Q1FY24.
Total advances rose by about 16 per cent you to stand at ₹12,23,154 crore.
The retail loan portfolio grew by 17 per cent y-o-y and comprised 54.4 per cent of the total loan portfolio at June 30, 2024. Within retail loans, the bank has calibrated personal loan growth to about 25 per cent in the reporting quarter, down from the high 30s at one point in time, Batra said, adding this is clearly the effect of all the adjustments the bank has been doing for some time.
The business banking portfolio grew by 36 per cent y-o-y at June 30, 2024. The SME business, comprising borrowers with a turnover of less than ₹250 crore, grew by 23.5 per cent y-o-y. The rural portfolio grew by 17 per cent y-o-y. The domestic corporate portfolio grew by 10 per cent y-o-y.
Meanwhile, the bank’s consolidated net profit increased by 10 per cent y-o-y in the reporting quarter to ₹11,696 crore against ₹10,636 crore in the year-ago period.