ICICI Bank eyes fee income to boost topline

ICICI Bank is eyeing fee business besides retail to boost its topline, Chanda Kochhar, executive director, said. "Over and above retail, we are seeing robust growth in fee income," Kochhar said.

The fee-based income contributed 35.10 per cent to total income of the bank in the first quarter of the current financial year.

Currently, companies are investing in a big way in projects but they are not seeking bank loans as they can fund the projects internally or from external borrowings, Kochhar said.

"There are big opportunities in terms of syndicating term loans, syndicating foreign currency borrowings, syndicating equity or quasi-equity fund, opening letters of credit, giving bank guarantees...the entire fee-based income is a huge opportunity," she said.

The bank also is also eyeing a major part of its fee business from remittances earning.

"Remittances is a big flow of income for us. We have a market share of 15 per cent of total remittances in India," Kochhar said. The private sector bank's remittances business is $3 billion of the total $20 billion remittances business in India.

In the first quarter of 2005-06, around 8 per cent of the bank's fee income was from international business, while 60 per cent was from the retail segment and the rest from the corporate, Kochhar said.

The country's second largest bank has the largest retail asset portfolio at Rs 620.63 billion as on June 30.

The bank's total assets grew 49 per cent in the first quarter of the current financial year over the same period a year ago, while deposits grew 70 per cent during the same reporting period.

"We would focus on stable retail deposits, which grew by more than 40% in the first quarter (2005-06)," Kochhar said.

The bank's retail assets grew 70 per cent over the first quarter of 2004-05.

"The growth in retail is higher than the industry growth of 30 per cent. We will aim to grow at least the industry rate so that we don't lose market share," Kochhar said.

On whether the bank would lay emphasis on certificate of deposits that are cheaper and short term, Kochhar said, "we are not focusing on three-month, six-month or wholesale kind of deposits that have to be retired in bulk."

As a part of its future growth strategy, the bank would continue to focus on retail deposits and would use the excess deposits to retire old ICICI Ltd borrowings and high-cost debt, she said.