ICICI Bank’s Q1 net profit rises 40% to ₹9,648 crore

ICICI Bank reported an all-time high quarterly standalone net profit of Rs.9,648 crore in the first quarter (Q1FY24) on the back of healthy growth in net interest income and non-interest income.

Net profit in the said quarter increased by 40 per cent year-on-year compared to INR 6,905 crore in the same period last year.

The profitability comes despite an increase in operating expenses and net provisions.

The consolidated net profit of the private lender increased by 44 per cent to Rs.10,636 crore (Rs.7,385 crore).

Consolidated net profit includes the number of major subsidiaries/associate companies such as ICICI Securities, ICICI Prudential Asset Management Company, ICICI Home Finance, ICICI Prudential Life and others.

Independent performance

In the reporting quarter, net interest income (the difference between interest earned and interest disbursed) rose by 38 per cent to Rs.18,226 crore (Rs.13,210 crore).

Other income, which includes fee income, dividend income from subsidiaries/associates, gain/(loss) on sale of investments and miscellaneous income, increased by 16.5% to Rs.5,435 crore.

Net Interest Margin (NIM) improved to 4.78 percent in the first quarter of FY24 compared to 4.01 percent in the first quarter of FY23. However, this is lower compared to 4.90 percent in the previous quarter.

Re-pricing of deposits

Sandeep Batra, Managing Director, said: “Interest rates on term deposits have risen significantly over the past six to nine months… So, the successive decline in NIM reflects the delayed impact of repricing of deposits, which is partially offset by an increase in yields on loans and investments.

“We expect a repricing of deposits over the next couple of quarters. The overall decline in NIM is in line with our expectations. Going forward, we expect some moderation in NIM to continue…”

Operating expenses increased by around 26 per cent year-on-year to Rs.9,523 crore (Rs.7,566 crore). Net provisions increased by about 13 per cent to Rs.1,292 crore (Rs.1,144 crore).

Total non-performing assets (NPA) to gross advances position improved to 2.76 percent at the end of June 2023, compared to 2.81 percent at the end of March 2023. The net non-performing assets to net advances were unchanged at 0.48 percent.

Work boom

Total deposits increased by 17.9 per cent to INR 12,38,737 crore at the end of June 2023. Average Current and Savings Account (CASA) deposits fell to 42.6 per cent at the end of June 2023 from 43.6 per cent at the end of March 2023.

Total advances increased by 18.1 per cent to Rs.10,57,583 crore, with domestic advances growing by 20.6 per cent and overseas advances declining by 29.5 per cent.

Under domestic advances, banking recorded the highest growth at 30.4 percent, followed by small and medium businesses (28.5 percent), retail loans (21.9 percent), corporate loans (19.3 percent) and rural (17.6 percent).