ICICI Bank - the largest private sector lender - reported 8% drop in its net profit to Rs 2,049 crore for the quarter ended June due to fa...
ICICI Bank - the largest private sector lender - reported 8% drop in its net profit to Rs 2,049 crore for the quarter ended June due to fall in non-interest income.
Its non-interest income was Rs 3,388 crore in Q1 compared to Rs 3,429 crore ($531 million) in Q1-2017.
Its non-interest income was Rs 3,388 crore in Q1 compared to Rs 3,429 crore ($531 million) in Q1-2017.
Chanda Kochhar, MD & CEO of the bank said non-interest income in first quarter of the previous fiscal included exchange rate gain related to overseas operations of Rs 206 crore, which is no longer permitted to be accounted as income following Reserve Bank of India (RBI) guideline. In addition, quarterly dividend of Rs 204 crore from ICICI Prudential Life Insurance Company (ICICI Life), which has moved to dividend payments on a half-yearly basis following its initial public offering in September 2016.
On the asset quality front Ms.Kochhar highlighted that net non-performing assets have come down on a sequential basis from Rs 25,451 crore (4.86%) to Rs 25,306 crore (4.89%). Its gross NPAs have also fallen from Rs 42,552 crore (7.89%) Rs 43148 crore (7.99%), sequentially.
“Addition to gross NPAs, which was Rs 4,975 crore - was the lowest in seven quarters,” Ms. Kocchar said adding that addition to NPA in the current financial year will be lower than the previous year.
The bank has seen a healthy recovery and upgradation during the quarter which was around Rs 2575 crore, mainly aided by loan repayment by a large cement firm following resolution of stress.
The bank has made a provisioning of Rs 2,609 crore during the quarter as compared to Rs 2,515 crore, and except for Rs 160 crore which was standard asset provisioning, the remaining provision was for bad loans.
The bank said it has an exposure of Rs 6,889 crore to the 12 accounts (excluding Rs 351 crore for non-fund based exposure) that are referred for bankruptcy proceedings by RBI. The bank has a made a provision of Rs,827.66 crore for these accounts which represents a provision coverage of 41% and another Rs647.28 crore provisioning is required to be made in the three quarters.
On the business front, the bank reported a loan growth of 11% while its retail loan book, which is now 53% of the overall loan book, grew by 19%. The net interest income increased by 8% on a year-on-year basis to Rs5,590 crore while net interest margins for the quarter was 3.27% as compared to 3.16% in the same period of the previous fiscal and 3.57% in the fourth quarter of 2016-17.
