ICICI Bank Q3 results, ICICI Bank profit: Jumps by 24% to Rs 10,272 Crore; Decline in Provisions; Important Highlights.

ICICI Bank Q3 results, ICICI Bank profit:ICICI Bank reported that provisions for the quarter amounted to Rs 1,049.37 crore. This figure is higher than the provisions of Rs 582.63 crore in the September quarter but lower than the provisions of Rs 2,257.44 crore from the same period last year.

ICICI Bank, a private lender, reported a significant year-on-year increase in its standalone net profit. The profit surged by 23.57%, reaching Rs 10,271.54 crore for the December quarter, compared to Rs 8,311.85 crore in the same period last year. This performance aligns with analysts' expectations of a 19-25% growth ahead of the quarterly results.

For the quarter, ICICI Bank reported provisions of Rs 1,049.37 crore, showing an increase from Rs 582.63 crore in the September quarter but a decrease from the year-ago figure of Rs 2,257.44 crore, aligning with expectations.

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The net interest income (NII) for the quarter experienced a 13.4% year-on-year growth, reaching Rs 18,678 crore compared to Rs 16,465 crore in the same quarter last year, meeting the Street estimate. The net interest margin (NIM) was recorded at 4.43%, a slight decrease from 4.53% in the September quarter and 4.65% in the year-ago quarter. The gross NPA ratio also improved, falling to 2.30% at December 31, 2023, from 2.48% at September 30, 2023.

ICICI Bank noted a 19.8% year-on-year increase in its non-interest income, excluding treasury, reaching Rs 5,975 crore from Rs 4,987 crore.

In the quarter, ICICI Bank observed a 19.4% increase in fee income, reaching Rs 5,313 crore compared to Rs 4,448 crore. Notably, fees from retail, rural, business banking, and SME customers accounted for approximately 79% of the total fees in Q3.

ICICI Bank reported a treasury gain of Rs 123 crore for the quarter, surpassing the year-ago figure of Rs 36 crore. Provisions for the quarter included Rs 627 crore related to investments in Alternate Investment Funds, following the RBI circular dated December 19, 2023.

As of the end of the December quarter, deposits exhibited an 18.7% year-on-year increase, reaching Rs 13,32,315 crore. Simultaneously, the domestic loan portfolio witnessed an 18.8% growth, amounting to Rs 11,14,820 crore.

ICICI Bank's Communication in the Press Release

Expansion of Credit Facilities

As of December 31, 2023, net domestic advances witnessed an 18.8% year-on-year growth and a 3.8% sequential increase. The retail loan portfolio demonstrated a substantial 21.4% year-on-year growth and a 4.5% sequential increase, constituting 54.3% of the total loan portfolio.

Considering non-fund outstanding, the retail portfolio represented 46.4% of the total portfolio as of December 31, 2023. The business banking portfolio experienced a remarkable 31.9% year-on-year growth and a 6.5% sequential increase during the same period. The SME business, catering to borrowers with a turnover of less than Rs 250 crore (US$ 30 million), exhibited a robust 27.5% year-on-year growth and a 6.7% sequential increase at the end of December 31, 2023.

As of December 31, 2023, the rural portfolio demonstrated an 18.2% year-on-year growth and a 4.6% sequential increase. Meanwhile, the domestic corporate portfolio experienced a 13.3% year-on-year growth and a 2.9% sequential increase.

The overall advances, totaling Rs 11,53,771 crore (US$ 138.7 billion), saw an 18.5% year-on-year increase and a 3.9% sequential increase as of December 31, 2023.

In terms of deposits, the total period-end deposits displayed an 18.7% year-on-year growth and a 2.9% sequential increase, amounting to Rs 13,32,315 crore (US$ 160.1 billion) at the end of December 31, 2023. Additionally, period-end term deposits grew by 31.2% year-on-year and 4.9% sequentially, reaching Rs 8,04,320 crore (US$ 96.7 billion) at the same date.

In the third quarter of 2024, average current account deposits saw an 11.6% year-on-year increase. Similarly, average savings account deposits witnessed a 2.8% year-on-year growth during the same period.

With the incorporation of 471 branches over the first nine months of 2024, the bank expanded its network to encompass 6,371 branches and 17,037 ATMs and cash recycling machines as of December 31, 2023.

Quality of Assets

As of December 31, 2023, the gross NPA ratio decreased to 2.30% from 2.48% at September 30, 2023. The net NPA ratio was 0.44% at December 31, 2023, slightly up from 0.43% at September 30, 2023, but down from 0.55% at December 31, 2022.

During the third quarter of 2024, net additions to gross NPAs, excluding write-offs and sales, amounted to Rs 363 crore (US$ 44 million), compared to Rs 116 crore (US$ 14 million) in the second quarter of 2024. Gross NPA additions were Rs 5,714 crore (US$ 687 million) in Q3-2024, an increase from Rs 4,687 crore (US$ 563 million) in Q2-2024.

Recoveries and upgrades of NPAs, excluding write-offs and sales, totaled Rs 5,351 crore (US$ 643 million) in Q3-2024, compared to Rs 4,571 crore (US$ 549 million) in Q2-2024. The bank wrote off gross NPAs amounting to Rs 1,389 crore (US$ 167 million) in Q3-2024.

The provisioning coverage ratio on NPAs stood at 80.7% as of December 31, 2023.

Excluding Non-Performing Assets (NPAs), the total fund-based outstanding to all borrowers under resolution, following existing regulations and guidelines, decreased to Rs 3,318 crore (US$ 399 million) or 0.3% of total advances as of December 31, 2023, down from Rs 3,536 crore (US$ 425 million) at September 30, 2023. The bank has set aside provisions amounting to Rs 1,032 crore (US$ 124 million) for these borrowers under resolution as of December 31, 2023.

ICICI Bank maintains contingency provisions of Rs 13,100 crore (US$ 1.6 billion) as of December 31, 2023.

The loan and non-fund-based outstanding to performing corporate and SME borrowers rated BB and below stood at Rs 5,853 crore (US$ 703 million) at December 31, 2023, compared to Rs 4,789 crore (US$ 576 million) at September 30, 2023. Within the total outstanding of Rs 5,853 crore (US$ 703 million) at December 31, 2023, Rs 661 crore (US$ 79 million) is attributed to borrowers under resolution.

Sufficiency of Capital

As of December 31, 2023, considering profits for the nine months ended, the bank's total capital adequacy ratio stood at 16.70%, surpassing the minimum regulatory requirement of 11.70%. The Common Equity Tier-1 (CET-1) ratio was 16.03%, exceeding the regulatory requirement of 8.20%.