See many opportunities to grow core operating profit in a risk-calibrated manner: Sandeep Batra, ICICI Bank

Last Updated 28 April 2021, 15:30 IST

ICICI Bank, India’s second largest private lender, reported an impressive over three-fold jump in standalone net profit at Rs. 4,403 crore for the quarter ended March 31, 2021 as compared to Rs. 1,221 crore for the same period last year. This rise is primarily due a substantial increase in retail loans through digital initiatives and halving of provision for bad loans.

Here are key takeaways from basis leadership commentary.

Significant Growth Loans

The overall domestic loan portfolio increased by 18% y-o-y, far outpacing the overall banking sector's growth of 5.6%.

Meanwhile, the retail loan portfolio grew by 20% y-o-y and 7% sequentially. Within the retail portfolio, the mortgage loan portfolio grew by 22% y-o-y, business banking by 41%, rural loans by 27%, commercial vehicle and equipment loans by 8% and the auto loan portfolio by 13%.

Further, the growth in the personal loan and credit card portfolio was 9% y-o-y.

On the corporate portfolio side, the bank recorded growth of 13% year-on-year and 5% sequentially. Overall, the domestic loan portfolio grew by 18% year-on-year and 6% sequentially.

Growth in Core-operating profit

In the quarter ended March 31, 2021, core operating profit (profit before provisions and tax, excluding treasury income) increased by 20% y-o-y to Rs. 8,565 crore (US$ 1.2 billion).

Additionally, the bank had net worth of approximately Rs. 1.5 lakh crore and total capital adequacy ratio of 19.12%, at March 31, 2021.

Mr. Sandeep Batra, Executive Director said, “Looking ahead, we see many opportunities in the medium term to grow the core operating profit in a risk-calibrated manner. We continue to innovate, invest in technology and drive analytics to get deeper insights into customer behavior.”

Growth in Deposits

Deposit growth continued to be robust, with total deposits growing at 21.0% y-o-y to Rs. 9.3 lakh crore at March 31, 2021.

The average current and savings account (CASA) deposits have grown by 24% y-o-y in Q4-2021; average CASA ratio stood at 42% in Q4-2021. The term deposits grew by 18% y-o-y to Rs. 5 lakh crore at March 31, 2021.


The bank’s net non-performing asset (NPA) ratio declined to 1.14% at March 31, 2021 from 1.26% (on a pro-forma basis) at December 31, 2020 and 1.41% at March 31, 2020. While, the provision coverage ratio was 77.7% at March 31, 2021.

Covid-19 Provision

ICICI Bank is well-positioned with best-in-class growth rates and the protection from Covid-19 provisions buffer. The bank has made additional Covid-19 related provision of Rs. 1,000 crore (US$ 137 million) in Q4-2021 and held Covid-19 related provisions of Rs. 7,475 crore (US$ 1.0 billion) at March 31, 2021.

“The performance of the portfolio in the face of the pandemic has demonstrated the robustness of our underwriting and portfolio selection in recent years. Even after taking into account the higher NPA additions due to the pandemic, we have maintained a healthy provisioning coverage, including by making our provisioning policy more conservative. Further, we continue to hold Covid-19 related provisions of Rs. 7,475 crore.” according to Sandeep Batra.

Digital Initiatives

Digital channels like internet, mobile banking, PoS and others accounted for over 90% of the savings account transactions in FY2021. The volume of mobile banking transactions increased by 61% year-on-year in Q4-2021.

“Our micro-market strategy to tap opportunities based on the market potential and 360-degree customer coverage using ICICISTACK have played a significant role in expanding our franchise and deepening relationships with our customers. We continue to strengthen our position in the digital payments ecosystem by building seamless user journeys, facilitating higher transaction throughputs and driving repeat transactions,” Sandeep Batra added.

ICICI Bank’s iMobile Pay which offers payment and banking services to customers of any bank have seen over 15 lakh activations from non-ICICI Bank customers within four months of its launch. It has seen high customer engagement through repeat usage of features like Pay2Contact, Scan to Pay and bill payments among others.

On the way forward, Sandeep Batra mentioned said, “We see many opportunities in the medium term to grow the core operating profit in a risk-calibrated manner. We will calibrate our growth in the near term based on the operating environment and conditions resulting from the second wave of the Covid-19 pandemic. We continue to innovate, invest in technology and drive analytics to get deeper insights into customer behavior.”

The Bank will continue to focus on delivering consistent and predictable returns to its shareholders, Sandeep Batra added.

This article is part of a featured content programme.
(Published 28 April 2021, 15:15 IST)

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