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ICICI Bank Q3 net profit jumps 23.6% to Rs 10,272 cr, NII up 13.4%

ICICI Bank’s net profit rose by 23.6 per cent year-on-year (Y-o-Y) to Rs 10,272 crore for the quarter that ended December 2023 (Q3 FY24), predominantly on the back of a healthy rise in non-interest income and stable asset quality. In the quarter ended December 2022 (Q3 FY23), the bank had posted a net profit of Rs 8,311.8 crore.

Sequentially, the private sector lender’s profit showed a small rise from Rs 10,261 crore in the quarter ended September (Q2 FY24).

Net Interest Income (NII) expanded 13.4 per cent to Rs 18,678 crore in Q3 FY24, compared with Rs 16,465 crore in the corresponding quarter of the previous year. The bank’s Net Interest Margin (NIM) declined to 4.43 per cent in Q3 FY24, compared to 4.65 per cent in Q3 FY23. The decrease in NIMs was in line with expectations due to a rise in the cost of term deposits. NIMs for FY24 are expected to be on the level of FY23 (4.48 per cent), according to bank executives.

Its Capital Adequacy Ratio (CAR) moderated to 14.61 per cent at the end of December 2023, down from 16.07 per cent in September 2023 and 16.26 per cent in December 2022, according to the financial results statement. The CAR calculation excludes the profits earned in the quarter and the nine months.

The drop in CAR followed the Reserve Bank of India’s (RBI) increase in risk weights for unsecured loans, as stated by ICICI Bank executives in a media call post the announcement of Q3 FY24 results.

Non-interest income, comprising fees, commissions, and recoveries, rose by 19.8 per cent Y-o-Y to Rs 5,975 crore in Q3 FY24.

The Provision Coverage Ratio (PCR), excluding write-offs, moderated to 80.7 per cent in December 2023, down from 82 per cent a year earlier. The bank made a provision of Rs 627 crore for the exposure to Alternative Investment Funds (AIFs). AIFs form a small portion of the total assets, and the bank is not in a hurry to exit from the portfolio. Decisions regarding the portfolio will be made based on shareholder benefits, officials added.

Advances grew 18.37 per cent Y-o-Y to Rs 11.53 trillion in Q3 FY24. The retail loan portfolio grew by 21.4 per cent Y-o-Y and comprised 54.3 per cent of the total loan portfolio as of December 31, 2023. The growth pace of personal credit (unsecured loans) slowed to about 37 per cent Y-o-Y in December 2023, down from over 40 per cent Y-o-Y a year earlier. The bank has tightened norms for unsecured loans, executives added.

Total deposits increased 18.7 per cent Y-o-Y to Rs 13.32 trillion. The average share of low-cost deposits — Current Account and Savings Account (CASA) — declined to 39.4 per cent at the end of December, down from 44.6 per cent a year earlier.

ICICI Bank’s asset quality profile improved, with Gross Non-Performing Assets (NPAs) declining to 2.3 per cent in December from 3.07 per cent a year earlier. Net NPAs declined to 0.44 per cent in December 2023, down from 0.55 per cent in the same period last year.

First Published: Jan 20 2024 | 6:42 PM IST

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