ICICI Bank reports highest net profit ever for Q2 as provisions decline

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ICICI Bank private lender net income rose 30% ₹5,511 crore, the highest ever value for the lender for the second quarter ended September 30 (Q2FY22), largely due to strong loan growth and lower provisions. It was the same ₹4,251 crore in the same quarter last year (Q2FY21).

Provisions decreased by 9% compared to the previous year ₹2,714 crore in the second quarter of ₹2,995 crore in the same period last year.

Sequentially, the lender’s profit rose 19.3% versus ₹4,616 crore in the June quarter (Q1FY22).

The bank’s net interest income (NII) — the difference between the interest paid by the lender and the interest paid by the lender — rose by 25% ₹11,690 crore in the September quarter. It was ₹9,366 crore in Q2FY21.

Meanwhile, the net interest margin (NIM) rose to 4% in the second quarter from 3.89% in the June quarter and 3.57% in the same period last year.

The lender’s core operating profit increased 23% year over year ₹9,518 crore in the quarter ended September.

Lender’s noninterest income (NII) increased 26% year over year ₹4,400 crore in Q2FY22 from ₹3,486 crore in Q2FY21.

“As the economy grew, payouts for all retail products increased sequentially in the second quarter. The disbursements for mortgages were

near the level of the March quarter of FY21, reflecting increased demand coupled with the bank’s seamless customer onboarding experience through pre-approved offerings and digitization, “ICICI Bank said in a filing.

In terms of asset quality, Gross Non-Performing Assets (NPAs) at the end of the quarter were 4.82%, less than 5.15% in the prior June quarter and 5.17% in the year-ago period.

Net NPAs declined 12% sequentially during the quarter ₹8,161 crore of ₹9,306 crore, while the net NPA ratio fell from 1.16% in the first quarter to 0.99% in the second quarter. The net NPA rate was the lowest since December 2014

Total deposits increased 17% year over year and 6% sequentially ₹9.77 lakh crore in the September quarter.

The bank’s total capital adequacy at the end of the second quarter was 19.52% and the tier 1 capital adequacy of 18.53% was above the minimum regulatory requirements of 11.08% and 9.08%, respectively.

On Friday, ICICI Bank shares hit an all-time high of ₹765.85 and eventually closed 0.5% higher ₹759.30 on NSE.

Credit growth

The retail loan portfolio grew 20% year over year and 5% sequentially, accounting for 62.1% of the total loan portfolio at the end of the second quarter.

Domestic advances increased 19% year-over-year and 4% sequentially, while total advances rose 17% year-over-year and 4% sequentially over the period ₹7.64 lakh crore.

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