Mumbai: ICICI Bank on Friday said its July- September quarter net profit jumped over 30 percent to a record Rs 1,956.11 crore, driven by a rise in net interest income and strong growth in advances.
On a consolidated basis, net profit of the country's largest private sector bank for the second quarter ended September 30, rose 20 percent to Rs 2,390.37 crore from Rs 1,991.68 crore a year ago.
ICICI Bank Managing Director and Chief Executive Chanda Kochhar attributed the robust numbers to the strong dividend income from its subsidiaries like insurance and broking, among others, apart from good retail-driven advances which pushed up the net interest income, which is the difference between interest paid and earned.
The rise in net profit was also helped by higher trading income, which rose to Rs 172 crore in the quarter against a loss of Rs 21 crore in the year ago period, she said.
ICICI Bank aims to grow its domestic loan book by around a fifth this fiscal year, led by consumer and working capital loans, and will be particularly cautious in unsecured retail lending and project finance, she said.
The year-on-year growth in retail advances was 14 percent as compared 10.3 percent in the June quarter.
Net interest income soared 35 percent to Rs 3,371 crore from Rs 2,506 crore a year ago, while net interest margin rose to 3.00 percent from 2.61 percent YoY (year-on-year).
Non-interest income rose 17 percent to Rs 2,043 crore from Rs 1,740 crore. Cost-to-income ratio came down to 40.9 percent from 44.4 percent a year ago, Kochhar said.
Total provisions rose to Rs 508 crore from Rs 319 crore a year ago and Rs 466 crore in the previous quarter.
However, analysts and market did not react positively to the numbers as after an initial response, the bank's stocks went down on BSE to Rs 1,078 at 1430 hrs, a drop of 0.6 percent.
Soon after the initial numbers were announced, ICICI Bank shares rose to Rs 1,102.40. The scrip closed almost flat at Rs 1078.25 on a day when Sensex lost 133 points.
Brokerage Emkay Global termed the numbers on expected lines.
"The 35 percent spike in net interest income was aided by 2.5 percent Q-o-Q (Quarter-on-Quarter) growth in advances and flat NIM (Net Interest Margin) at 3.0 percent, while growth in fee income continues to remain muted at 0.5 percent Y-o-Y.
"Other income at Rs 2,043 crore, up over 17 percent, was aided by higher trading gains of Rs 172 crore against a loss of Rs 21 crore in the first quarter of the fiscal," the brokerage said.
Giving a break-up of the loan-book, Kochhar said retail advances constitute 33 percent of the total loan book, international advances account for 25 percent with the rest being corporate lending.
During the quarter, the bank saw its other income rise to Rs 2,043 crore, helped by Rs 1,709 crore in fee income, which was almost flat, Rs 172 crore from treasury/trading income and Rs 62 crore in dividends from subsidiaries.
Net non-performing assets (NPA) rose to Rs 2,138 crore compared to Rs 1,941 crore in the June quarter but improved from Rs 2,236 crore in the year-ago period.
The net NPA ratio improved to 0.66 percent compared to 0.61 percent in June quarter and 0.80 percent a year ago.
The net restructured assets marginally came down to Rs 4,158 crore from Rs 4,172 crore in the June quarter.
The total income for period increased to Rs 18,609.43 crore in the period under review from Rs 16,110.61 crore a year ago.
On the bad assets front, Kochhar said the bank had to make a provision for Rs 500 crore to a media company and also provided 85 percent of this amount. Going forward, she said, there won't be any material impact on the bank.
Asked about outlook on the CDR (corporate debt restructuring), Kochhar said there is around Rs 500 crore in the pipeline pending at the CDR cell.
On her bank's exposure to the troubled power sector, she said ICICI's total exposure is 7 percent of its overall advances.
The bank has "very insignificant" exposure to the SEBs (state electricity boards), whose Rs 1.9 trillion debt was recast last month by the Government.
The bank's total income rose to Rs 12,069.30 crore in the quarter under review from Rs 9,897.17 crore a year ago.
Total advances grew 18 percent to Rs 2.75 lakh crore at the end of the reporting period. Savings account deposits rose 15 percent Y-o-Y to Rs 80,618 crore, while current account deposits shot up to Rs 33,800 crore.
Stating that the bank is confident of growing above the industry trend on the retail loan front, Kochhar said retail assets constitute Rs 61,400 crore of the total advances of Rs 93,000 crore, while auto loan book is Rs 9,500 crore.
Overall credit growth stood at 18 percent, driven by a 14 percent rise in retail loans against 10 percent in the first quarter, 27 percent spurt in auto loans and 12 percent spike in home loans.
Advances to the corporate sector rose 21 percent, while its international loan book logged in 21 percent growth, Kochhar said.
The crucial net interest margin - the difference between the interest a bank pays for deposits and the interest it earns from lending - rose 30 bps to 3 percent Y-o-Y.
ICICI Prudential Life's profit rose to Rs 396 crore in the quarter from Rs 350 crore, as its annualised premium equivalent increased 14 percent to Rs 1,351 crore.
ICICI Lombard General Insurance's profit nearly doubled to Rs 101 crore from Rs 56 crore year ago.