ICICI Bank Q3 profit jumps 25.7 pc to Rs 11,053 cr on lower provisions

MUMBAI: ICICI Bank on Saturday said its consolidated net profit for the December quarter jumped 25.7 per cent to Rs 11,052.60 crore, helped by lower provisions.

The second-largest private sector lender's standalone net profit for the October-December period grew 23.6 per cent to Rs 10,272 crore.

The bank's core net interest income went up by 13.4 per cent to Rs 18,678 crore. The net interest margin narrowed to 4.43 per cent from 4.65 per cent in the year-ago period, and the domestic advances growth came at 18.8 per cent.

The other income grew 19.8 per cent to Rs 5,975 crore during the reporting quarter.

The deposit growth came at 18.7 per cent, but just like peers, the bank also witnessed a faster growth in term deposit front at the expense of the low-cost current and savings account deposits which helped the margins.

The bank's credit deposit ratio came at 86 per cent, which the management said is "comfortable" but will be closely monitored going ahead. They added that there is no challenge in funding the current credit growth.

Its executive director Sandeep Batra told reporters that the NIMs were in line with the expectations, and added that the bank expects the number in FY24 to be broadly the same as FY23.

Its provisions came down to Rs 1,049.37 crore from the Rs 2,257.44 crore in the year-ago period, despite taking a Rs 627 crore hit due to its investments in alternative investment funds following a RBI diktat. Batra said nearly the entire stock of AIFs has been provided for now.

He said the provisions were lower because in the year-ago period, it had taken a contingency provision and also taken the impact of a shift in provisioning policies.

On the asset quality front, the gross slippages came at over Rs 5,000 crore and were driven by rural advances which have a seasonality feature, Batra said.

The bank slowed down the growth in unsecured lending during the reporting quarter following the RBI's flags on the business in the system, Batra said, pointing out that personal loans grew at 37 per cent in Q3 as against 40 per cent.

Its exposure to non-bank lenders another area flagged by RBI - also came down to over Rs 74,000 crore as against over Rs 79,000 crore three months ago due to payments by some state-run companies, Batra said.

The bank's capital adequacy got hit by 0.70 percentage points because of the regulatory changes on the risk weights, Batra said, adding that the core buffer levels are at a comfortable level of over 16 per cent even after providing for the higher risk weights.

Among the subsidiaries, the life insurance arm's PAT inched up to Rs 227 crore, the general insurance arm had its net grow by 22.1 per cent to Rs 431 crore, the asset management company delivered a 30 per cent growth in net profit at Rs 546 crore and the brokerage business had its net growing 66 per cent to Rs 466 crore.

In a note, the brokerage Sharekhan termed it as a "steady quarter" for the bank with better than expected NIMs.

ICICI Bank scrip gained 0.92 per cent to close at Rs 1,008.3 a piece on the BSE on Saturday, as against a correction of 0.36 per cent on the benchmark.