NEW DELHI: Stake sale in two of its subsidiaries — ICICI Lombard and ICICI Prudential Life Insurance Company — helped ICICI Bank’s standalone profit for the June quarter rise by 36 per cent to Rs 2,599 crore.
“During Q1FY21, the bank sold equity shares representing 3.96 per cent in ICICI Lombard General Insurance Company Limited and 1.5 per cent in ICICI Prudential Life Insurance Company Limited for a total consideration of Rs 3,092.93 crore.
The sale resulted in net gain (after sale related expenses) of Rs 3,036.29 crore in standalone financial results and Rs 2,715.87 crore in consolidated financial results for Q1FY21,” the bank said in a regulatory filing.
ICICI Bank had reported net profit of Rs 1,908 crore in the year-ago period. On a consolidated basis, net profit for the April-June period improved by 24 per cent at Rs 3,117.68 crore against Rs 2,513.69 crore in the corresponding quarter of the previous fiscal.
Total income during the quarter rose to Rs 26,066 crore from Rs 21,405.50 crore a year earlier, the bank added. Net interest income rose nearly 20 per cent to Rs 9,278 crore.
The bank also admitted that the lockdown imposed due to Covid-19 impacted its loan books adversely. “During Q1FY21, the loan growth was impacted due to lower credit demand and fee income declined due to lower borrowing and investment activity by customers and lower consumer spends, “ the bank added.
The lender reported an improvement in asset quality with gross non-performing assets (NPAs) felling to 5.46 per cent of the gross advances by the end of June 2020, from 6.49 per cent a year ago. Net NPA ratio decreased from 1.41 per cent in March quarter to 1.23 per cent in June quarter and 1.77 per cent a year ago.
In the first quarter of the current fiscal, the bank has made an additional Covid-19-related provision amounting to Rs 5,550 crore. However, because of poor macroeconomic conditions the bank expects “higher additions to non-performing loans, increase in provisions, lower loan growth and fee income”.