ICICI Bank Q4 takeaways: BB and below book drops 4%, Rs 1,000 crore Covid provisions & more

ICICI Bank Q4 takeaways: BB and below book drops 4%, Rs 1,000 crore Covid provisions & more


NEW DELHI: A lower-than-expected fall in quarterly provisions hurt ‘s profit growth in March quarter, as the bank chose to make Rs 1,000 crore in Covid-19 related provisions on a prudent basis. A 17 per cent growth in net interest income (NII) met market expectations while asset quality improved when compared with proforma non-performing assets (NPA) of December quarter. Net interest margins were stable for the quarter.

Here are the key takeaways from ICICI Bank’s Q4 results

BB and below rated NPAs fall 4%

The bank said its BB and below rated fund-based and non-fund based outstanding to borrowers fell 4 per cent to Rs 13,098 crore as of March 31 compared with Rs 13,654 crore as of December 31. Recoveries and upgrades for the quarter came in at Rs 2,560 crore. This excludes recoveries from proforma NPAs, write-offs and sale.

Mobile transactions up 61%

The bank said the volume of mobile banking transactions jumped 61 per cent in the March quarter. The value of merchants acquiring transactions on UPI soared 149 per cent YoY, the lender said in a BSE filing. The bank said it had a 37 per cent market share in electronic toll collections through FASTag, with such collections rising 51 per cent YoY in the March quarter. Overall, digital channels like internet, mobile banking, PoS and others accounted for over 90 per cent of the savings account transactions in FY21.

Rs 1,000 cr in fresh Covid provisions

ICICI Bank made Covid-related provisions worth Rs 1,000 crore on a prudent basis during the quarter. During the March quarter, the bank utilised contingency provision amounting to Rs 3,509 crore towards proforma NPAs as of December 31, as the loans have now been classified as per the RBI guidelines. In the December quarter, the bank had utilised Rs 1,800 crore of Covid-related provisions made in the earlier periods. The bank said it has Rs 7,475 crore as Covid-19 related provisions as of March 31.

Retail loan growth at 20% in Q4

ICICI’s retail loan portfolio rose 20 per cent YoY and 7 per cent QoQ in the March quarter. Retail loans comprised 67 per cent of the total loan portfolio at March 31, 2021. Including non-fund outstanding, retail accounted for 55 per cent of the total portfolio. “Growth in the performing domestic corporate portfolio was about 13 per cent year-on-year driven by disbursements to higher rated corporates and public sector undertakings (PSUs) across various sectors to meet their working capital and capital expenditure requirements,” the bank said.

Total advances jumped 14 per cent YoY to Rs 7,33,729 crore from Rs 6,45,290 crore in the year-ago quarter. Domestic advances for the quarter rose 18 per cent YoY and 6 per cent sequentially.

Rs 25 crore hit on rising yields

The bank said it incurred Rs 25 crore in treasury loss during the fourth quarter on rise in yields on fixed income

and government securities. This is against a treasury profit of Rs 242 crore in the same quarter last year.

PAT misses, NII meet expectations

A 261 per cent year-on-year (YoY) rise in net profit at Rs 4,403 crore over year-ago’s Rs 1,221.40 crore profit missed ET NOW poll estimate of Rs 4,980 crore. Net interest income (NII) at Rs 10,431 crore, up 17 per cent over year-ago’s Rs 8,927 crore beat ET NOW poll figure of Rs 10,306 crore.

Deposit grows at 21% in Q4

The bank said its total deposits jumped 21 per cent year-on-year to Rs 932,522 crore, with average current account deposits rising 34 per cent and average savings account deposits increasing 21 per cent. Total term deposits rose 18 per cent YoY to Rs 500,899 crore. The bank saw 18 per cent growth in term deposits and 24 per cent YoY growth in average current and savings account (CASA) deposits. Average CASA ratio stood at 42 per cent.

Provision coverage ratio at 77%

Provision coverage ratio for the quarter stood at 77 per cent for the quarter. Total capital adequacy ratio stood at of 19.12 per cent while Tier-1 capital adequacy ratio stood at 18.06 per cent on a standalone basis.

Dividend announced; no divestments in Q
4

The bank announced a dividend of Rs 2 per share. This is after the RBI in a circular of April 22 lifted freeze on dividend payments by commercial banks. Meanwhile, unlike the last couple of quarters, the bank did not divest any stake in its subsidiaries in the March quarter. In the December quarter, the bank had sold

shares, representing 2.21 per cent in the company. In September quarter, the bank had sold 2 per cent stake in ICICI Securities while in June quarter it had sold 3.96 per cent stake in ICICI Lombard, 1.5 per cent stake in ICICI Prudential Life. The stake sales helped the company log strong two-fold jump in FY21 profit at Rs 18,384.32 crore from Rs 9,566.31 crore in FY20.



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