ICICI Bank Registered Profit After Tax Growth With 78% YoY at 4616 Crore in Q1-22

The Board of Directors of ICICI Bank Limited (NSE: ICICIBANK, BSE: 532174,  NYSE: IBN) at its meeting held at Mumbai today, approved the standalone and consolidated accounts of the Bank for the quarter ended June 30, 2021  (Q1-2022). The statutory auditors have conducted a limited review and have issued an unmodified report on the standalone and consolidated financial statements for the quarter ended June 30, 2021.

Profit & loss account 

∙ The core operating profit (profit before provisions and tax, excluding  treasury income) increased by 23% year-on-year to ₹ 8,605 crore (US$  1.2 billion) in Q1-2022 from ₹ 7,014 crore (US$ 944 million) in the quarter  ended June 30, 2020 (Q1-2021) 

∙ Net interest income (NII) increased by 18% year-on-year to ` 10,936  crore (US$ 1.5 billion) in Q1-2022 from ` 9,280 crore (US$ 1.2 billion) in  Q1-2021 

∙ The net interest margin was 3.89% in Q1-2022 compared to 3.84% in the  quarter ended March 31, 2021 (Q4-2021) and 3.69% in Q1-2021 ∙ Non-interest income, excluding treasury income, increased by 56%  year-on-year to ₹ 3,706 crore (US$ 499 million) in Q1-2022 from ₹ 2,380 crore (US$ 320 million) in Q1-2021 

∙ Fee income grew by 53% year-on-year to ₹ 3,219 crore (US$ 433 million)  in Q1-2022 from ₹ 2,104 crore (US$ 283 million) in Q1-2021. Fees from  retail, business banking and SME customers increased by 65% year-on year and constituted about 76% of total fees in Q1-2022 

∙ Treasury income was ` 290 crore (US$ 39 million) in Q1-2022 compared  to ` 3,763 crore (US$ 506 million) in Q1-2021. The treasury gain in Q1- 2021 included gains of ` 3,036 crore (US$ 408 million) from sale of shares  of subsidiaries 

∙ Provisions (excluding provision for tax) were ` 2,852 crore (US$ 384 million) in Q1-2022 compared to ` 7,594 crore (US$ 1.0 billion) in Q1- 2021. During Q1-2022, the Bank has changed its policy on non performing loans to make it more conservative. The change in policy   resulted in higher provision on non-performing advances amounting to  ` 1,127 crore (US$ 152 million) for aligning provisions on outsanding  loans to the revised policy 

∙ Based on its current assessment of the portfolio, the Bank wrote back Covid-19 provisions amounting to ` 1,050 crore (US$ 141 million) made  in earlier periods  

∙ At June 30, 2021, the Bank held Covid-19 related provision of ` 6,425 crore (US$ 864 million) 

∙ The profit before tax grew by 90% year-on-year to ₹ 6,043 crore (US$  813 million) in Q1-2022 from ₹ 3,183 crore (US$ 428 million) in Q1-2021 ∙ On a standalone basis, the profit after tax grew by 78% year-on-year to  ` 4,616 crore (US$ 621 million) in Q1-2022 compared to ₹ 2,599 crore  (US$ 350 million) in Q1-2021

Growth in digital and payments platforms 

In December 2020, the Bank had expanded its state-of-the-art mobile  banking app, iMobile, to iMobile Pay which offers payment and banking  services to customers of any bank. There have been over 25 lakh activations  of iMobile Pay by non-ICICI Bank account holders within six months of its  launch. The transactions by non-ICICI Bank account holders in terms of value  and volume have grown by eight times and seven times, respectively, in  June 2021 compared to March 2021. The value of transactions through the ‘Pay to Contact’ feature, which enables users to easily transfer money to any  payment app or digital wallet via UPI, has grown by over three times in June  2021 compared to March 2021.  

During Q1-2022, the Amazon Pay credit card became the fastest co-branded  credit card in the country to cross the milestone of issuing 2.0 million cards.  The Bank recently launched a co-branded credit card with Hindustan  Petroleum Corporation Limited (HPCL) called ‘ICICI Bank HPCL Super Saver  Credit Card’. This card offers best-in-class rewards and benefits to  customers on their everyday spends on fuel as well as other categories. 

The business banking and SME franchise continues to grow on the back of  digital offerings and platforms like InstaBIZ. InstaBIZ offers various services  such as instant overdraft facility, payment of Goods and Services Tax (GST),  foreign exchange deal booking, business loans based on revenues reported  in GST returns, automatic bank reconciliations and inward and outward  remittances. The Bank’s supply chain platform enables corporates to  seamlessly manage their supply chain financing and payments, collection  and reconciliation requirements of their dealers and vendors in a convenient  and paperless manner. The financial transactions on InstaBIZ and supply  chain platforms have grown steadily in the past few quarters.  

In the Unified Payment Interface (UPI) space, the Bank’s strategy is to  participate directly through the Bank’s own platforms as well as partner with  third party players, in both the peer-to-peer and payment-to-merchant  segments. The value of the Bank’s merchant acquiring transactions through  UPI has more than doubled year-on-year and grew by 32% sequentially in  Q1-2022. 

The value of mobile banking transactions increased by 117% year-on-year  to ₹ 349,072 crore (US$ 47 billion) in Q1-2022. Digital channels like internet,  mobile banking, PoS and others accounted for over 90% of the savings  account transactions in Q1-2022. The Bank is a market leader in electronic  toll collections through FASTag. The Bank had a market share of 36% by  value in the electronic toll collections through FASTag in Q1-2022, with a  146% year-on-year growth in collections.

In Q1-2022, the Bank launched a digital platform called Merchant Stack,  which offers an array of banking and value-added services to retailers, online  businesses and large e-commerce firms such as digital current account  opening, instant overdraft facilities based on point-of-sale transactions and  instant settlement of point-of-sale transactions, among others.  

In Q1-2022, the Bank introduced ICICI STACK for Corporates which is a  comprehensive set of digital banking solutions for corporates and their  entire ecosystem of promoters, employees, dealers, and vendors. These  solutions enable corporates to seamlessly meet all banking requirements of  their ecosystems in a frictionless manner. 

Operating review 

Retail disbursements moderated in April and May due to the containment  measures in place across various aparts of the country. With the gradual  easing of restrictions, disbursements picked up in June and July. Credit card  spends declined in April and May and increased to March levels in June,  driven by spends in categories like consumer durables, utilities, education  and insurance. Credits received in the overdraft accounts of business banking and SME customers also picked up in June and July after declining  in April and May.  

Credit growth 

The retail loan portfolio grew by 20% year-on-year and comprised 61.4%  of the total loan portfolio at June 30, 2021. Including non-fund outstanding,  retail was 50.4% of the total portfolio at June 30, 2021. The business banking  portfolio grew by 53% year-on-year and was 5.4% of total loans at June 30,  2021. The SME business, comprising borrowers with a turnover of less than 

` 250 crore (US$ 34 million), grew by 43% year-on-year and constituted  4.0% of total loans at June 30, 2021. Growth in the domestic corporate  portfolio was about 11% year-on-year driven by disbursements to higher  rated corporates and public sector undertakings across various sectors. The  growth in performing domestic corporate portfolio, excluding the builder  portfolio, was 15% year-on-year at June 30, 2021. The domestic advances  grew by 20% year-on-year. Total advances increased by 17% year-on-year  to ` 738,598 crore (US$ 99.4 billion) at June 30, 2021 from ` 631,215 crore (US$ 84.9 billion) at June 30, 2020.

Deposit growth 

Total deposits increased by 16% year-on-year to ` 926,224 crore (US$ 124.6  billion) at June 30, 2021. Average current account deposits increased by  32% year-on-year in Q1-2022. Average savings account deposits increased  by 22% year-on-year in Q1-2022. Total term deposits increased by 9% year 

on-year to ` 501,122 crore (US$ 67.4 billion) at June 30, 2021.  

The Bank had a network of 5,268 branches and 14,141 ATMs at June 30,  2021. 

Asset quality 

The net non-performing assets were ` 9,306 crore (US$ 1.3 billion) at June  30, 2021 compared to ` 9,180 crore (US$ 1.2 billion) at March 31, 2021. The  net NPA ratio was 1.16% at June 30, 2021 compared to 1.14% at March 31,  2021. The net addition to gross NPAs during the quarter was ` 3,604 crore  (US$ 485 million). The gross NPA additions were ₹ 7,231 crore (US$ 973 

million) in Q1-2022. Recoveries and upgrades of NPAs, excluding write-offs and sale, were ` 3,627 crore (US$ 488 million) in Q1-2022. The gross NPAs  written off were ` 1,589 crore (US$ 214 million) in Q1-2022. Excluding NPAs,  the total fund based outstanding to all borrowers under resolution as per the  various extant regulations/guidelines was ` 4,864 crore (US$ 654 million), or  about 0.7% of the total loan portfolio, at June 30, 2021 compared to ` 3,927  crore (US$ 528 million) at March 31, 2021. The fund-based and non-fund  based outstanding to borrowers rated BB and below (excluding fund and  non-fund based outstanding to NPAs) was ` 13,975 crore (US$ 1.9 billion) at  June 30, 2021 compared to ` 13,098 crore (US$ 1.8 billion) at March 31,  2021. 

Capital adequacy 

The Bank’s total capital adequacy at June 30, 2021 was 19.27% and Tier-1  capital adequacy (including profits for Q1-2022) was 18.24% compared to  the minimum regulatory requirements of 11.08% and 9.08% respectively. 

Consolidated results 

The consolidated profit after tax was ` 4,747 crore (US$ 639 million) in Q1- 2022 compared to ` 4,886 crore (US$ 657 million) in Q4-2021 and ` 3,118 crore (US$ 419 million) in Q1-2021. 

Consolidated assets grew by 9% year-on-year to ` 1,572,772 crore (US$ 211.6 billion) at June 30, 2021 from ` 1,443,576 crore (US$ 194.2 billion) at  June 30, 2020.

Subsidiaries  

Value of New Business (VNB) of ICICI Prudential Life Insurance (ICICI Life) increased by 78% year-on-year to ₹ 358 crore (US$ 48 million) in Q1-2022. The new business premium increased by 71% year-on-year to ₹ 2,559 crore  (US$ 344 million) in Q1-2022. The new business margin increased from  24.4% in Q1-2021 to ₹ 29.4% in Q1-2022. The protection based annualised  premium equivalent grew by 26% year-on-year to ` 270 crore (US$ 36 million) and accounted for 22.1% of the total annualised premium equivalent in Q1-2022.  

The Gross Direct Premium Income (GDPI) of ICICI Lombard General  Insurance Company (ICICI General) grew by 13% year-on-year to ₹ 3,733 crore (US$ 502 million) in Q1-2022 from ₹ 3,302 crore (US$ 444 million) in  Q1-2021. The combined ratio was 121.3% in Q1-2022 compared to 99.7% in  Q1-2021. The profit after tax of ICICI General was ₹ 152 crore (US$ 20 million)  in Q1-2022 compared to ₹ 398 crore (US$ 54 million) in Q1-2021.  

The profit after tax of ICICI Securities, on a consolidated basis, as per Ind AS, grew by 61% year-on-year to ₹ 311 crore (US$ 42 million) in Q1-2022 from ₹ 193 crore (US$ 26 million) in Q1-2021. 

The profit after tax of ICICI Prudential Asset Management Company (ICICI  AMC), as per Ind AS, grew by 48% year-on-year to ₹ 380 crore (US$ 51 million) in Q1-2022 compared to ₹ 257 crore (US$ 35 million) in Q1-2021.