ICICI Bank, the country’s largest private sector lender, reported a 39.29 per cent rise in consolidated net profit to Rs 1,559.76 crore for the quarter ended December 31, 2008, compared to the year-ago period.
Total income grew 8.11 per cent to Rs 16,922.73 crore in the same period. The bank said the subsidiaries that saw an increase in profits during the quarter were ICICI Bank UK, ICICI Bank Canada, ICICI Securities primary dealership and ICICI Home Finance. There was also a substantial reduction in the loss of ICICI Prudential Life Insurance during the quarter.
On a standalone basis, the bank said net profit climbed 3.4 per cent to Rs 1,272 crore, beating analysts’ estimates, on gains from investments in government bonds and a drop in operating expenses.
Profits, which bore the brunt of investor and depositor concerns about its exposure to global financial crisis in the September quarter, were largely driven by treasury income, which more than trebled to Rs 976 crore amid flat interest and other income.
ICICI Bank, which is slowing lending to check rising defaults, saw its bad debts surge to 2.07 per cent of net advances from 1.5 per cent a year ago. In percentage terms, ICICI Bank's non-performing assets are far higher than any other top bank’s. Net non-performing advances (or sticky loans) grew 36.32 per cent to Rs 4,400.23 crore.
“The bank has pursued a strategy of lightening the balance sheet and prioritising capital conservation, liquidity management and risk containment given the economic environment,” the bank said.
The bank reduced its operating expenses by 19 per cent during the quarter. Still, it increased provisions by 33 per cent to Rs 1,007 crore. Advances dropped 1.3 per cent to Rs 2,120 crore.