ICICI Bank reported a 19% rise in net profit grew to ₹4,940 crore in the third quarter ended December 31,from a year earlier, despite higher provisioning towards bad loans.
Its core operating profit grew 15% to ₹8,054 crore. Net interest income (NII) increased 16% to ₹9,912 crore.
Total deposits climbed 22% to ₹874,348 crore, domestic loans grew 13% and retail loans rose 15% year-on-year.
“We see optimism in the economy,” said Sandeep Batra, executive director, ICICI Bank, in a conference call. “We are in a good position to capitalise. We are now more confident.”
He said the continued pickup in economic activity and tailwinds from the festive season reflected in an increase in disbursements across retail products. Mortgage disbursements reached an all-time monthly high in December.
Disbursements of auto loans crossed pre-Covid levels in December and credit card spending also reached pre-pandemic levels in the same month, led by increased spending in categories such as health & wellness, electronics and e-commerce, he said.
The bank made provisions (excluding provision for tax) of ₹2,742 crore compared with ₹2,083 crore a year earlier. During the quarter, the bank made contingency provisions amounting to ₹3,012 crore for borrower accounts not classified as non-performing pursuant to the interim order of the Supreme Court.
As on December 31, the bank held aggregate COVID-19 related provisions of ₹9,984 crore, including contingency provision for proforma NPAs amounting to ₹3,509 crore for loans not classified as non-performing. Out of this, the bank utilised ₹1,800 crore towards provisioning during this quarter.
During the quarter the bank changed its provisioning policy on non-performing assets to make it more ‘conservative’. The contingency provision made on a prudent basis for loans overdue for more than 90 days at December 31, 2020 but not classified as non-performing pursuant to the Supreme Court’s interim order, also reflects the revised policy, it said in a regulatory filing.
“The change in policy resulted in higher provision on advances amounting to ₹2,096 crore during the quarter for aligning provisions on the outstanding loans to the revised policy,” it said.
During the quarter, the gross additions to NPAs were ₹471 crore. Recoveries and upgrades, excluding write-offs from non-performing loans were ₹1,776 crore.
The net NPA ratio was 0.63% as on December 31. Loans amounting to ₹8,280 crore compared with ₹1,410 crore on September 30, were not classified as non-performing pursuant to the Supreme Court’s interim order.
On a proforma basis, the net NPA ratio was 1.26% compared with 1.12% on September 30. The provision coverage ratio on a proforma basis was at 77.6%.
Excluding proforma NPAs, the total fund-based outstanding to all borrowers under resolution was ₹Rs 2,546 crore or about 0.4% of the total loan portfolio.
ICICI Bank reported consolidated profit of ₹5,498 crore compared with the ₹4,670 crore profit report a year earlier.