ICICI Bank Q3 net profit jumps 25% to Rs 6,194 cr; NII rises 23%

Asset quality of the bank improved and its provisions fell 27% to Rs 2,007 in Q3FY22 from Rs 2,742 crore in Q3FY21

Private sector lender ICICI Bank on Saturday reported a 25 per cent jump in net profit in the October–December quarter (Q3FY22), aided by lower provisions and a robust increase in net interest income (NII). The lender’s net profit in the reporting quarter stood at Rs 6,194 crore, its highest ever quarterly profit, beating Street estimates. Analysts had estimated a net profit of Rs 5,800 crore.

Its net interest income rose 23 per cent to Rs 12,236 crore in Q3FY22 as compared to Rs 9,912 crore in the corresponding period of last financial year. Also, non-interest income of the lender increased by 25 per cent to Rs 4,899 crore, of which fee income rose by 19 per cent to Rs 4,291 crore. The net interest margin, a measure of profitability of banks, fell 4 basis points sequentially to 3.96 per cent.

Provisions of the lender fell by 27 per cent to Rs 2,007 in Q3FY22 from Rs 2,742 crore in Q3FY21. At the end of December quarter, the bank was holding Rs 6,425 crore as Covid-related provisions. During the current financial year, it has written back provisions to the tune of Rs 1,050 crore.

Asset quality of the bank improved with gross non-performing assets (NPAs) falling by 69 basis points (bps) sequentially to 4.13 per cent at the end of December quarter. Similarly, net NPAs have fallen by 14 bps to 0.85 per cent. During the quarter, gross NPA additions of the bank declined to 4,018 crore compared to Rs 5,578 crore in the previous quarter while recoveries and upgrades were to the tune of Rs 4,209 and the gross NPAs written off were to the tune of Rs 4,088 crore.

The bank has restructured loans worth Rs 4,500.51 crore under Reserve Bank of India’s second Covid-19 resolution framework. Overall, the bank’s restructured book under various restructuring frameworks is to the tune of Rs 9,684 crore or 1.2 per cent of total advances at the end of December quarter. The bank holds provisions amounting to Rs 2,436 crore against these borrowers.

The domestic loan portfolio of the bank has grown by 18 per cent YoY and 6 per cent QoQ to Rs 8.13 trillion, with retail loan portfolio growing by 19 per cent YoY and 5 per cent QoQ. The business banking portfolio grew by 39 per cent YoY and 9 per cent QoQ while SME loans grew by 34 per cent YoY and 10 per cent QoQ. And, the wholesale book of the bank grew by 13 per cent YoY and 9 per cent QoQ.

On the other hand, deposits grew by 16 per cent YoY and 4 per cent sequentially to Rs 10.17 trillion at the end of December quarter, of which low-cost deposits constituted 45 per cent.

Sandeep Batra, Executive Director, ICICI Bank said: “As things stand today, the third Covid wave has created local disruptions. We do not anticipate at this point of time any significant economic disruption to the portfolio we have. We have Covid provisions that we have not released this quarter and we will wait for the third wave to subside”.