ICICI Bank's Quarterly Profit Plunges to Lowest Since 2006

ICICI Bank, India\'s largest private sector lender by assets, its quarterly profit plunged three-fourths to the lowest.

Published: 29th April 2016 02:30 PM  |   Last Updated: 29th April 2016 02:30 PM   |  A+A-

MUMBAI: ICICI Bank, India's largest private sector lender by assets, reported its quarterly profit plunged three-fourths to the lowest in nearly a decade as provisions for bad loans jumped.

The bank said on Friday net profit fell 76 percent to 7.02 billion rupees ($105.56 million) for its fiscal fourth quarter to March 31, missing analysts estimates of 31.42 billion rupees.

The quarterly profit was the smallest for ICICI, also listed in New York <IBN.N>, since the June quarter of 2006, according to Thomson Reuters data.

Indian banks' bad loans have surged in the past six months after an asset-quality review ordered by the Reserve Bank of India (RBI) as part of a clean-up exercise. ICICI said it had completed the review.

The bank said it made on a prudent basis a contingency and related reserve of 36 billion rupees in the fourth quarter, over and above provisions made for bad and restructured loans, to account for any potential trouble for exposures to five sectors, including iron and steel, mining and power.

Normal provisions rose to 33.3 billion rupees during the quarter from 13.4 billion rupees in the year-ago period. Gross bad loans as a percentage of total loans were at 5.82 percent at the end of the March quarter, compared with 4.72 percent at end of December.

ICICI shares fell as much as 3.6 percent after the results and were trading down 3 percent at 233 rupees on the BSE Sensex at 1.30 p.m.

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