ICICI net up 13% at Rs 2,532 cr on core income, treasury gains

The largest private sector lender ICICI Bank today reported net profit climbed 13 per cent to Rs 2,532 crore, the slowest pace of increase in four years, helped by growth in interest income and treasury gains.
On a consolidated basis, profit rose 9 per cent to Rs 2,872 crore, with both its insurance subsidiaries reporting good sets of numbers.
Net interest income grew 22 per cent to Rs 4,255 crore, while non-interest income was up 26 per cent at Rs 2,801 crore, helped by treasury profit.
Pre-tax profit from treasury operations rose to Rs 1,397.16 crore from Rs 934.49 crore a year ago.

The net interest margin expanded to 3.32 per cent compared with 3.07 per cent last year. Chief Executive Officer and Managing Director Chanda Kochhar said the bank will be able to sustain the net interest margin at these levels.
Profit growth was restrained by an additional provision of Rs 215 crore toward deferred tax liabilities on special reserves for the nine-months ending December. Kochhar said henceforth, the bank will set aside up to Rs 70 crore every quarter for the tax liabilities, in accordance with RBI norms.

A spike in asset stress resulted in provisions for loan losses increasing to Rs 695 crore as against Rs 625 crore last year, Kochhar said.

During the reporting quarter, the bank added Rs 1,230 crore to its gross non-performing assets (NPAs). Net advances to companies with restructured loans increased by Rs 1,776 crore to Rs 8,602 crore.
Kochhar said the gloom on the economic front is far from over and she believes there will be additions to NPAs and restructured assets for the next two quarters.
The bank has a recast loan pipeline of Rs 3,000 crore, she added.
She said stress on assets is not sector specific but group or company specific and emanating across sectors. It was able to maintain the cost-to-income ratio at 37 per cent and is targeting to keep it under 40 per cent, Kochhar said.

Analysts at Angel Broking said the bank's results were in line with expectations and recommended buying the stock even amid the current difficulties.