ICICI Bank Q2 Net Profit Up 15% to Rs 2,709 cr on Retail Demand

Published: 31st October 2014 06:00 AM  |   Last Updated: 30th October 2014 10:53 PM   |  A+A-

MUMBAI: ICICI Bank, the country’s second biggest private sector bank after HDFC Bank, reported 15.18 per cent increase in its net profit at Rs 2, 709 crore for the second quarter ended Sept 30, helped by an increase in demand for retail loans. The bank posted Rs 2, 352 crore net profit in the same period a year ago.

ICICI.jpgRetail loans, which account for 40 per cent of the bank’s total credit, grew 25 per cent. Home loans that account for 55 per cent of the bank’s total retail credit, loans for vehicles and to rural and small businesses account for about 20 per cent each in the retail segment. Corporate credit grew a modest 3 per cent.

“There is always a lag between economic recovery and increase in demand from the corporate sector. Real pick-up in demand for new projects is at least a couple of quarters away,’’ bank’s chief executive Chanda Kochhar said in a conference call.

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“We expect retail loans to grow around 20 per cent during the year,’’ she said.

The lender has not witnessed any rise in demand for infrastructure loans this year.

Gross non-performing assets (NPAs) rose to 3.12 per cent from 3.05 per cent. Of the Rs 1,518 crore addition to the gross NPAs, about half of them were slippages from loans restructured earlier.

“New addition to NPAs and restructured loans could be lower than last year,” said Kochhar, holding out hope that the bad loan cycle may have peaked.

Its net interest income increased 15 per cent to Rs 4,657 crore from Rs 4,044 crore. Net interest margin, a benchmark to measure profitability, increased to 3.42 per cent during the quarter under review from 3.31 per cent in the same period a year ago.

The bank’s low-cost CASA deposits rose to 43.7 per cent of its total deposits from 43 per cent, while cost to income ratio declined to 36.5 per cent from 38.4 per cent a year earlier.


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