ICICI Bank Reports Strong Q1 Results with 39.7% Rise in Profit Amidst Robust Growth

ICICI Bank, one of India’s leading private sector banks, recently announced its standalone profit after tax (PAT) for the first quarter of FY24, ending in June. The bank’s remarkable performance during this period saw its profit surge to Rs 9,648 crore, a substantial 39.7% increase compared to the same quarter in the previous year. In Q1 FY23, the bank had reported a net profit of Rs 6,905 crores, making the current financial results a significant leap in earnings.

Key Financial Indicators:

During the April-June quarter of FY24, ICICI Bank showcased robust growth across various financial indicators, demonstrating the bank’s resilience and ability to adapt to changing economic landscapes.

1. Core Operating Profit: The bank’s core operating profit grew impressively by 35.2% year-on-year, reaching Rs 13,887 crore in Q1 FY24, indicating a strong underlying performance.

2. Fee Income: The bank’s fee income witnessed a steady rise of 14.1% year-on-year, amounting to Rs 4,843 crore in the same quarter.

3. Net Interest Income (NII): ICICI Bank’s NII, a crucial measure of its interest-related earnings, experienced substantial growth, increasing by 38% year-on-year to Rs 18,227 crore during the quarter.

4. Net Interest Margin (NIM): The net interest margin for the bank stood at 4.78% in Q1 FY24, displaying an improvement from the previous year’s corresponding period (4.01%) and Q4 FY23 (4.90%).

Asset Quality and NPA Ratios:

ICICI Bank’s asset quality showcased stability and improvements during the quarter.

1. Gross NPAs: The gross non-performing assets (NPAs) for Q1 FY24 amounted to Rs 31,822.39 crore, compared to Rs 31,183.70 crore in Q4 FY23.

2. Gross NPA Ratio: The gross NPA ratio at the end of the June quarter was 2.76%, showing a slight decline from 2.81% sequentially.

3. Net NPA Ratio: The net NPA ratio remained steady at 0.48% at June-end, unchanged from March 2023-end and improved from 0.70% in the corresponding period of the previous fiscal year.

4. Addition to Gross NPAs: During the quarter, the bank added Rs 1,807 crore to its gross NPAs, excluding write-offs and sales, while simultaneously recovering Rs 1,169 crore from the existing NPAs.

Business and Retail Portfolio Growth:

ICICI Bank witnessed substantial growth across its business and retail loan portfolios.

1. Retail Loan Portfolio: The bank’s retail loan portfolio expanded by an impressive 21.9% year-on-year and 4.5% sequentially, accounting for 54.3% of its total loan portfolio.

2. Business Banking Portfolio: The business banking portfolio also demonstrated robust growth, rising by 30.4% year-on-year.

3. Domestic Corporate Portfolio: The domestic corporate loan portfolio grew by 19.3% year-on-year, indicating the bank’s continued focus on corporate lending.

Deposits and CASA Ratio:

Provision Coverage and Capital Adequacy:

ICICI Bank maintained robust provisions and capital adequacy ratios.

1. Net NPA Provision Coverage: The provision coverage ratio on non-performing assets stood at an impressive 82.4% as of June 30, 2023.

2. As of June 30, 2023, ICICI Bank reported a total capital adequacy ratio of 17.47% and a Tier-1 capital adequacy ratio of 16.76% on a standalone basis, signifying a strong and healthy capital position. The bank’s Q1 FY24 results highlight its capability to maintain growth momentum while prioritizing asset quality and exercising prudent risk management practices.

ICICI Bank’s Q1 FY24 results underscore its ability to sustain growth momentum while maintaining asset quality and prudent risk management. The bank’s focus on retail and business loan growth, coupled with the increase in fee income and NII, positions it well to navigate the dynamic banking landscape. With ongoing efforts to optimize interest income and manage NPAs effectively, ICICI Bank continues to showcase its commitment to delivering value to its stakeholders and customers. As the financial year unfolds, analysts and investors eagerly anticipate the bank’s strategic moves and performance trends to gauge its future prospects in the banking sector.