ICICI Bank's consolidated profit up 14%; provisions soar

Private sector lender ICICI Bank today posted a 14 per cent increase in consolidated profit for the September quarter at Rs 3,065 crore, driven by a surge in non-interest income.
On stand-alone basis, the profit is up 15 per cent to Rs 2,709 crore.
Non-interest income jumped 26 per cent to Rs 2,738 crore, Managing Director and Chief Executive Chanda Kochhar told reporters. She attributed the uptick to a 20 per cent jump in retail fees and a Rs 137-crore treasury profit.
The bank restructured Rs 900 crore of bad assets during the quarter, but overall restructured book was down by almost Rs 200 crore as some assets slipped into NPAs, while there were some upgrades as well, Kochhar said, adding this resulted in a big jump in provisions to Rs 849.50 crore, as against Rs 624.80 crore.

The core net interest income rose 15 per cent to Rs 4,657 crore, driven by a healthy 25 per cent spike in retail assets.
The overall domestic loan growth was 15 per cent. Kochhar said the bank will continue to outpace the system by 2-4 per cent for FY 2015, while retail growth will be above 20 per cent, she added.

Within the retail category, the secured home and auto loans categories registered a healthy growth, she said in a concall, adding that the unsecured credit cards and personal loan portfolio accounts for 2.5 per cent of the asset book.

The bank continued with its cautious approach towards corporates during the quarter, where working capital requirements led to a 5 per cent demand growth, while the small businesses segment was flat, she said.
When asked about the measures taken by the government and its impact on loan growth, Kochhar said corporate demand for projects is at least two quarters away.
Even though its smaller rival Axis Bank cut its base rate last week, Kochhar hinted that the bank is not mulling any such move as of now, saying the lending rate movement is a function of the cost of funds, which was down by a marginal 0.03 per cent during the quarter and a revision in lending rate is possible only when there is a "meaningful" reduction in it, she added.

The bank witnessed a gross addition of Rs 1,693 crore in bad assets, which included Rs 800 crore of earlier restructured assets slipping in, she said.
ICICI Bank shares inched up 0.5 per cent to Rs 1611.50 on the BSE, whose benchmark Sensex rallied 0.93 per cent.