ICICI Bank

ICICI Bank has reported strong performance in the quarter ended December 11 with 20% increase in the Net Profit at Rs 1728.10 crore and 17% increase in NII at Rs 2712.02 crore. The other income continues to be a laggard but 70 bps dip in the cost to income ratio and 27% dip in the provisions at Rs 341.1 crore has aided growth in the Net Profit. The Silver lining in this quarter results are improvement in asset quality, NIM and CASA ratio.

On the consolidated front, the bank has reported 7% increase in both total income (at Rs 16497.35 crore) and Net Profit (at Rs 2174.22 crore) for the quarter ended December 11.

Asset Quality:

• Asset quality of the bank continues to improve in the quarter under review. Gross NPA declined 5% y-o-y and 3% q-o-q to Rs 9723.01 crore in the quarter ended December 11. On the other hand, Net NPA has fallen 29% y-o-y and 6% q-o-q to Rs 2047.67 crore. On Sequential basis, Gross Retail NPA's declined to Rs 6170 crore while that of Net retail NPA declined 15% to Rs 832 crore.
• %GNPA declined to 3.82% against 4.75% a year ago and 4.14% a quarter ago. %NNPA declined to 0.83% from 1.39% a year ago and 0.93% a quarter ago. Provision coverage ratio also improved to 78.9% against 71.8% in the quarter ended December 10 and 78.2% at end of September 11.
• Net restructured assets at end of December 11 increased to Rs 3070 crore.
• Outstanding General provisions on standard assets stood firm on q-o-q at Rs 1480 crore at end of December 11.

Business Highlights:

• Business of the bank has increased 6% q-o-q and 19% y-o-y to Rs 5067.47 billion at end of December 11 against Rs 4244.39 billion in the corresponding previous year.
• Advances grew 19% y-o-y and 5% q-o-q to Rs 2461.57 billion in the quarter ended December 11. Deposits grew 20% y-o-y and 6% q-o-q to Rs 260589 crore in the quarter under review. On q-o-q basis savings account grew 5% to Rs 70149 crore and Current account deposits grew 11% Rs 32997 crore in quarter under review. CASA ratio stood at 42.1% while Average CASA ratio stood 38.3% in quarter under review.
• Capital adequacy ratio stood at 18.88% and Tier I capital adequacy of 13.13% at end of December 11 against 18.99% with tier I capital of 13.14% in the quarter ended September 11.
• NIM improved to 2.7% against 2.64% in the quarter ended December 10 and 2.61% in quarter ended September 11.
• Return on average Net worth improved to 11.5% in quarter ended December 11 against 10.4% in the corresponding previous quarter. ROA improved to 1.57% against 1.47% in the corresponding previous quarter.
• Book Value per share improved to Rs 529 at end of December 11 against Rs 481 in the corresponding previous year.
• The bank continues to enjoy largest branch network among private sector bank with 2552 branches at end of December 11.

Quarterly Performance:

For the quarter ended December 11, ICICI Bank has reported 17% increase in NII at Rs 2712.02 crore on the back of 28% increase in the interest earned at Rs 8591.87 crore. Interest on advances grew 37% to Rs 5685.84 crore and drived growth in interest earned. On the other hand, interest expended jumped 34% to Rs 5879.85 crore. Other income inched up marginally 8% to Rs 1891.86 crore owing to small 5% increase in the fee income Rs 1701 crore. Further, loss of Rs 65 crore in treasury (against Rs 21 crore of profit in the corresponding previous quarter) was offset by whooping 149% jump in the lease and other noninterest income at Rs 256 crore. Thus Net total income was up 12% to Rs 4603.88 crore.

Staff cost has inched up 10% to Rs 836.63 crore and other operating expenses inched up 14% to Rs 1042.86 crore. The Direct marketing expenses declined 8% to Rs 37.29 crore in quarter under review. Thus operating expenses grew 12% to Rs 1916.78 crore. Cost to income ratio has declined 70 bps to 41.6% and led 15% growth in operating profit to Rs 2687.10 crore. Further, 27% dip in provisions and contingencies at Rs 341.10 crore, pushed PBT up 25% to Rs 2346.00 crore. Finally 280 bps increase in effective tax rate at 26.3% has led Net Profit up 20% to Rs 1728.10 crore.

YTD Performance:

For the nine months ended December 11, the bank has reported 23% increase in Net Profit at Rs 4563.49 crore over 17% increase in NII at Rs 7629.38 crore. Marginal 5% increase in other income at Rs 5274.30 crore coupled with 220 bps jump in cost to income ratio at 43.6% has led Operating profit up 8% to Rs 7274.88 crore. Further 11% dip in total provisions at Rs 2711.39 crore has aided humble growth in Net Profit.

• ICICI Home Finance PAT improved 35% to Rs 67 crore. Capital adequacy ratio improved to 26.5% against 25.5% in quarter ended September 11. NPA was flat on q-o-q basis at 1.3%.
• ICICI Life's overall market share for the period April to December 2011 was 6.3%. New business profit improved to Rs 138 crore in quarter under review. AUM declined 5% y-o-y and 2% q-o-q to Rs 632.22 billion in quarter under review. Expense ratio has increased to 21.4% against 17.60% a year ago and 20.40% in the quarter ended September 11.
• ICICI General recorded a 38% increase in profit after tax to Rs 101 crore in the quarter under review.
• ICICI Bank Canada's profit after tax for Q3 2012 declined 38% to Canadian Dollar 6.6 million. Total assets improved 13% to Canadian Dollar 5.3 billion at end of December 11. The capital adequacy ratio improved to 31.6% at end of December 11 against 29.3% at September 2011.
• ICICI Bank U.K. continued to see a balance sheet consolidation during Q3FY12 with the total assets declining from USD 4.8 billion at end of December 11. The profit after tax for ICICI Bank U.K. declined 29% to 7.7 million. The capital adequacy ratio was comfortable at 29.4% at December 2011.

Other Information:

• In accordance with Insurance Regulatory and Development Authority (IRDA) guidelines, ICICI Lombard General Insurance Company (ICICI General), together with all other general insurance companies participates in the Indian Motor Third Party Insurance Pool (the Pool), administered by the General Insurance Corporation of India (GIC) from April 1, 2007. The Pool covers reinsurance of third party risks of commercial vehicles. IRDA vide its order dated January 3, 2012 has enhanced the ultimate loss ratios (ULR) of the Pool to 159.0%, 188.0%, 200.0% and 213.0% for each of the four years from March 31, 2008 to March 31, 2011 as against the earlier determined loss ratio of 153.0%. The ULR for FY2012 is awaited. IRDA has clarified that the effect of required change on the liability reserve is to be considered as at the end of March 2012. The General Insurance Council has sought relaxations from IRDA, in the manner in which the liability has to be determined and treated in the books of accounts. Based on the ULR specified, the additional liability reserve to be provided for is estimated at Rs 626.83 crore as at the end of March 2012, which would impact the profit and loss account of ICICI General in the future.
• During the three months ended December 31, 2011, the Bank has allotted 152,578 equity shares of Rs 10/- each pursuant to exercise of employee stock options

ICICI Bank: Standalone Financial Results