ICICI Bank Q4 profit plunges 45%

ICICI Bank, which is facing conflict of interest allegations involving its chief Chanda Kochhar, on Monday posted a 45% decline in consolidated net profit to Rs 1,142 crore for three months ended March as bad loans surged.

The leading private sector lender had a consolidated profit of Rs 2,083 crore in the January-March quarter of 2016-17.

The total income on consolidated basis rose to Rs 33,760 crore during the quarter as against Rs 28,603 crore.

On a standalone basis, the bank recorded a 50% fall in net profit at Rs 1,020 crore in the latest fourth quarter. In the year-ago period, the same stood at Rs 2,025 crore.

However, standalone total income of the bank rose to Rs 19,943 crore in March quarter, from Rs 16,585.76 crore in preceding fiscal's last quarter, the bank said in a statement.

Net interest income also increased to Rs 6,022 crore in the quarter as compared to Rs 5,962 crore in the March quarter of the previous fiscal.

Gross non-performing assets (NPA) of the bank rose to 8.84% as a percentage of gross advances at the end of March, compared to 7.89% a year ago.

Net NPA, however, marginally declined to 4.77% from 4.89%.

As a result, the provisions and contingencies of the bank jumped to Rs 6,626 crore in the quarter under review as against Rs 2,898 crore in the same period previous fiscal.

The bank said there were gross NPA additions of Rs 15,737 crore, including Rs 9,968 crore of loans which were under RBI schemes and were classified as standard December 31, 2017.

On February 12, RBI issued a revised framework for resolution of stressed asset superseding its earlier guidelines, leading to accretion of NPAs.

The bank has classified three borrower accounts in the gems and jewellery sector with fund-based outstanding of Rs 794.87 crore as fraud and non-performing.

As a result, the bank made a provision of Rs 289.45 crore through profit and loss account and Rs 505.42 crore in the quarter by debiting reserves and surplus as permitted by the RBI.

Additionally, the bank has also made provision for certain other fraud and non-performing cases by debiting reserves and surplus amounting to Rs 19.98 crore.

The provision made by debiting reserves and surplus will be reversed and accounted through the profit and loss account over the subsequent quarters of the year ending March 31, 2019, it added.

Net interest margin increased from 3.14% in the quarter ended December 31, 2017 to 3.24% in the fourth and the last quarter, it said.

"The board recommended a dividend of Rs 1.50 per share(equivalent to dividend of $0.046 per ADS) for face value of Rs 2. The declaration of dividend is subject to requisite approvals. The record or book closure dates will be announced in due course," it said.

The annual results are announced at a time when the bank is grappling with a series of allegations of impropriety against its CEO Chanda Kochhar.

It is alleged that family members of Kochhar, including her husband Deepak Kochhar, got financial favours from the borrowers against the loans sanctioned by the bank. The issue is being investigated by multiple agencies including CBI, Income Tax Department.

The statement, however, did not mention anything about change in management in wake of allegations against the CEO.

According to sources, the recently appointed government nominee director did not attend the board meeting.

For the full fiscal 2017-18, the bank's standalone net profit slipped by 31% to Rs 6,777 crore as against Rs 9,801.09 crore in the previous fiscal.

Its total income during the fiscal also declined to Rs 72,386 crore as against Rs 73,661 crore crore in 2016-17.

On the credit expansion, the statement said, the year-on-year growth in domestic advances was 15% on March 31, 2018.

"The bank has continued to leverage its strong retail franchise, resulting in a year-on-year growth of 21% in the retail portfolio at March 31, 2018. The retail portfolio constituted about 57% of the loan portfolio of the bank at March 31, 2018," it said.

At the same time the low cost CASA (current account savings account) deposits increased by 17% to Rs 2,89,925 crore during the fiscal.

"The bank's CASA ratio was 51.7% at March 31, 2018 compared to 50.4% at December 31, 2017 and 50.4% March 31, 2017," it said.

ICICI Bank's board will meet again on Tuesday to discuss strategy and budget and planning for 2018-19.

During the quarter, the bank sold equity shares representing 20.78% shareholding in ICICI Securities Limited in an IPO for a total consideration of Rs 3,480.12 crore.

The sale resulted in a gain (after IPO related expenses) of Rs 3,319.77 crore in unconsolidated financial results and Rs 3,208.16 crore in consolidated financial results for FY18.

The bank also sold equity shares representing 7% shareholding in ICICI Lombard General Insurance Company Limited in an initial public offer (IPO) for a total consideration of Rs 2,099.43 crore in the second quarter of 2017-18.

The sale resulted in a gain after IPO related expenses of Rs 2,012.15 crore in unconsolidated financial results and Rs 1,711.32 crore in consolidated financial results for FY18.