INSUBCONTINENT EXCLUSIVE:
ICICI Bank said its provisions declined 42% on a year-on-year basis
ICICI Bank on
Saturday reported a 36.22 per cent rise in net profit to Rs 2,599.15 crore in the quarter ended June 30 compared to the corresponding period
a year ago, but missed analysts' estimates
Provisions for bad loans by the country's third largest private bank by market capitalisation rose sharply to account for the impact of the
In a regulatory filing, said its total income from operations came in at Rs 26,066.95 crore, up 21.78 per cent compared to the year-ago
On Friday, ICICI Bank shares had ended 2.66 per cent lower at Rs 381.85 apiece on the BSE, underperforming the benchmark Sensex index which
recovered most of the day's losses to close on a flat note
The net profit fell short of analysts' estimates
Analysts had on average estimated the lender's profit at Rs 2,747 crore, news agency Reuters reported citing Refinitiv data.ICICI Bank said
its total interest income stood at Rs 19,924.35 crore in the first quarter of current financial year, up 10.81 per cent on a year-on-year
basis.The lender's net interest income - or interest earned minus interest expended - climbed up 19.93 per cent to Rs 9,279.75 crore.The
bank's net interest margin (NIM) - a key measure of profitability - was at 3.69 per cent in the quarter ended June 30, 2020, as against
3.87 per cent in the previous quarter, and 3.61 per cent in the quarter ended June 30, 2019
The improvement in margin was aided by an increase in deposits and weak credit demand due to a nationwide lockdown to curb the spread of
COVID-19.ICICI Bank said its provisions - excluding those related to COVID-19 - declined 42 per cent compared to the year-ago period
The lender said it made additional provision to the tune of Rs 5,550 crore related to COVID-19, with the objective of completely cushioning
the balance sheet from the impact of the pandemic.The additional provisions were "with the objective of completely cushioning the balance
sheet from the impact of COVID-19," president Sandeep Batra said on a post-earnings conference call."We continue to live in uncertain
"From our perspective we wanted to be prudent and that is the reason why we made this provision."Gross non-performing assets - or bad loans
- as a percentage of total loans came in at 5.46 per cent in the first quarter of financial year 2020-21, as against in 5.53 per cent in
the previous quarter, and 6.49 per cent in the quarter ended June 30, 2019.The impact of COVID-19 is highly uncertain and will depend on its
ongoing spread, the effectiveness of steps taken by governments, central banks and ICICI Bank, and the time it takes for economic activities
to return to pre-pandemic levels, it said.Asset quality of banks in India is expected to take a severe hit due to the coronavirus-led
The country's central bank has warned the bad loans in the banking system could soar to almost 15% of total loans by March 2021.
