Money & Banking

ICICI Bank net up 30% on back of lower provisions

Our Bureau Mumbai | Updated on January 24, 2011 Published on January 24, 2011

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Net addition to NPAs ‘coming down'

A sharp decline in provisions and healthy growth in both interest and fee income helped ICICI Bank post a 30 per cent rise in net profit for the quarter ended December 31, 2010, at Rs 1,437 crore, from Rs 1,101 crore in the corresponding quarter last year. This is the highest-ever growth in net profit during a quarter, said Ms Chanda Kochhar, MD and CEO of the bank.

Though gross non-performing assets increased to Rs 10,187 crore (Rs 9,826 crore), net NPAs decreased to Rs 2,873 crore (Rs 4,357 crore), despite provisions declining by 53 per cent to Rs 465 crore (Rs 1,002 crore).

The quality of the new loan book is good, due to which the bank could lower its provisions, Ms Kochhar said. The bank saw upgradation in NPAs of about Rs 500 crore in the just-ended quarter. This also helped the bank improve its provisioning coverage ratio to 71.8 per cent (69 per cent).

“The net addition to NPAs is coming down. We reduced the provisioning by keeping tight control on credit quality and bringing down the retail unsecured book,'' Ms Kochhar said.

Going ahead, provisions could be lower as the bank has achieved the regulatory requirement, she added.

The bank would maintain Net Interest Margin at the current level of 2.6 per cent by focusing more on low cost current and savings accounts and reducing bulk deposits.

In the current fiscal, the bank is looking at credit growth of about 18 per cent and about 15 per cent growth in deposits.

Consolidated results

The net profit of the group surged 77 per cent to Rs 2,039 crore (Rs 1,149 crore) as the profit from subsidiaries was around Rs 600 crore, compared with Rs 50 crore last year.

The Shares of ICICI Bank closed at Rs 1,083.9, up 1.69 per cent, against the previous close of Rs 1,065.85, on the BSE, on Monday.

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Published on January 24, 2011
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