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Interaction with media on ICICI Bank’s financial performance in the quarter ended December 31, 2022

January 21, 2023.

Media call on January 21, 2023: opening remarks

Certain statements in this release relating to a future period of time (including inter alia concerning our future business plans or growth prospects) are forward-looking statements intended to qualify for the 'safe harbor' under applicable securities laws including the US Private Securities Litigation Reform Act of 1995. Such forward looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. These risks and uncertainties include, but are not limited to statutory and regulatory changes, international economic and business conditions, political or economic instability in the jurisdictions where we have operations, increase in nonperforming loans, unanticipated changes in interest rates, foreign exchange rates, equity prices or other rates or prices, our growth and expansion in business, the adequacy of our allowance for credit losses, the actual growth in demand for banking products and services, investment income, cash flow projections, our exposure to market risks, changes in India’s sovereign rating, and the impact of the Covid-19 pandemic which could result in fewer business opportunities, lower revenues, and an increase in the levels of non-performing assets and provisions, depending inter alia upon the period of time for which the pandemic extends, the remedial measures adopted by governments and central banks, and the time taken for economic activity to resume at normal levels after the pandemic, as well as other risks detailed in the reports filed by us with the United States Securities and Exchange Commission. Any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of the date of this release. ICICI Bank undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof. Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission. These filings are available at www.sec.gov.


This release does not constitute an offer of securities.


Good evening everyone. Joining me today for this call is our Group Chief Financial Officer- Anindya Banerjee. Thank you all for joining us today. We hope that you are safe and in good health.


Amidst the global uncertainties, India’s GDP growth has been resilient. The pickup in economic activity is reflected in the expanding purchasing managers’ indices, GST collections and other high frequency indicators. Financial stability has been maintained and inflation, though elevated, has moderated from its peak. We will continue to monitor these developments closely.


At ICICI Bank, we aim to grow the core operating profit in a riskcalibrated manner through a 360-degree customer-centric approach and by focusing on ecosystems and micro-markets. We continue to operate within our strategic framework and strengthen our franchise, enhance our delivery and servicing capabilities and expand our technology and digital offerings.


Our Board has today approved the financial results of ICICI Bank for the quarter ended December 31, 2022. I would like to highlight some key numbers:


A. Profit and capital

1. Core operating profit, that is, profit before provisions and tax, excluding treasury income, grew by 31.6% year-on-year to 13,235 crore Rupees in Q3-2023.

2. Net interest income increased by 34.6% year-on-year to 16,465 crore Rupees in Q3-2023.

3. The net interest margin was 4.65% in Q3-2023 compared to 3.96% in Q3-2022 and 4.31% in Q2-2023. Net interest margin was 4.33% in 9M-2023

4. Fee income grew by 3.7% year-on-year to 4,448 crore Rupees in Q3-2023

5. The profit after tax grew by 34.2% year-on-year to 8,312 crore Rupees in Q3-2023.

6. The consolidated profit after tax grew by 34.5% year-on-year to 8,792 crore Rupees in Q3-2023

7. The standalone RoE was 17.6% in Q3-2023.

8. At December 31, 2022, the Bank had a net worth of about 1.9 lakh crore Rupees. Including profits for 9M-2023, CET-1 ratio was 17.1%, Tier 1 ratio was 17.6% and total capital adequacy ratio was 18.3%.


B. Deposit growth

1. Total period-end deposits increased by 10.3% year-on-year to 11,22,049 crore Rupees at December 31, 2022.

2. Period-end term deposits increased by 14.2% year-on-year to 6,13,208 crore Rupees at December 31, 2022.

3. Average current account deposits increased by 7.9% year-on-year.

4. Average savings account deposits increased by 11.4% year-on-year.

5. We opened about 300 branches in 9M-2023 and had a network of 5,718 branches and 13,186 ATMs at December 31, 2022.

6. The Bank added about 11,200 employees in the last 9 months and had about 117,200 employees at December 31, 2022.


C. Loan growth

1. The overall loan portfolio grew by 19.7% year-on-year and 3.8% sequentially at December 31, 2022. The domestic loan portfolio grew by 21.4% year-on-year and 4.2% sequentially at December 31, 2022.

2. The retail loan portfolio, excluding rural loans, grew by 23.4% year-on-year and 4.5% sequentially. Including non-fund outstanding, the retail loan portfolio was 44.9% of the total portfolio. The rural portfolio grew by 12.5% year-on- year and 3.8% sequentially. The business banking portfolio grew by 37.9% year-on-year and 5.2% sequentially. The SME business, comprising borrowers with a turnover of less than 250 crore 5 Rupees grew by 25.0% year-on-year and 8.3% sequentially. Growth in the domestic wholesale banking portfolio was 18.2% year-on-year and 4.7% sequentially at December 31, 2022. 3. 73.1% of the total loan portfolio, excluding, retail and rural, was rated A- and above at December 31, 2022


D. Digital initiatives

1. There have been around 86 lakh activations from non-ICICI Bank account holders on our mobile banking app, iMobile Pay as of end-December 2022. The value of transactions by non-ICICI Bank account holders on iMobile Pay during Q3-2023 was 2.3 times the value of transactions in Q3-2022.


2. The value of the Bank’s merchant acquiring transactions through UPI grew by 10.6% sequentially and 78% year-on-year in Q3- 2023. The Bank had a market share of about 30.6% by value in electronic toll collections through FASTag in Q3-2023, with a 22.2% year-on-year growth in collections.


3. The business banking and SME franchise continues to grow on the back of digital offerings and platforms like InstaBIZ along with the Bank’s extensive branch network. The value of financial transactions on InstaBIZ grew by about 29.2% year-on-year in Q3-2023. There have been about 215,000 registrations from non-ICICI Bank account holders on InstaBIZ till December 31, 2022.


4. The Bank has created more than 20 industry specific STACKs which provide bespoke and purpose-based digital solutions to corporate clients and their ecosystems. The Bank’s Trade Online and Trade Emerge platforms allow customers to perform most of their trade finance and foreign exchange transactions digitally. About 71.2% of trade transactions were done digitally in Q3 of this year. The value of transactions done through these platforms increased by about 59.3% year-on-year in Q3 of this year.


5. The Bank has launched a STACK for real estate sector to offer digital and phygital banking solutions on one platform for builders, Real Estate Investment Trusts (REITs) and Alternate Investment Funds (AIFs) covering the entire lifecycle from construction to leasing and selling the property as well as services for their customers, employees and vendors.


6. The Bank has also launched comprehensive digital solutions, value-added services and Trade APIs for exporters covering the entire export life cycle including discovery of export markets, export finance - Insta EPC, foreign exchange services and export incentives.


E. Asset Quality

1. The net NPA ratio declined to 0.55% at December 31, 2022 from 0.61% at September 30, 2022 and 0.85% at December 31, 2021

2. During Q3-2023, there were net additions to gross NPAs of 1,119 crore Rupees compared to 605 Rupees crore in Q2-2023.

3. The gross NPA additions were 5,723 crore Rupees in Q3-2023 compared to 4,366 crore Rupees in Q2-2023. Recoveries and upgrades of NPAs, excluding write-offs and sale, were 4,604 crore Rupees in Q3-2023 compared to 3,761 crore Rupees in Q2- 2023.

4. The gross NPAs written off were 1,162 crore Rupees in Q3-2023.

5. The Bank did not sell any NPAs in Q3-2023.

6. The provisioning coverage ratio on NPAs was 82.0% at December 31, 2022.

7. The total fund based outstanding to all borrowers under resolution as per the various extant regulations declined to 4,987 crore Rupees or 0.5% of total advances at December 31, 2022 from 6,713 crore Rupees at September 30, 2022. The Bank holds provisions amounting to 1,529 crore Rupees against these borrowers under resolution, as of December 31, 2022.

8. The loan and non-fund based outstanding to performing borrowers rated BB and below reduced to 5,581 crore Rupees at December 31, 2022 from 7,638 crore Rupees at September 30, 2022.

9. The total provisions during the quarter were 2,257 crore Rupees or about 17.1% of core operating profit and about 0.93% of average advances. This includes contingency provisions of 1,500 crore Rupees made on a prudent basis. The Bank held contingency provisions of 11,500 crore Rupees at December 31, 2022.

10. During the quarter, we have revised our provisioning norms on non-performing assets to make them more conservative for corporate, SME and business banking. This change resulted in higher provisions amounting to about 1,196 crore Rupees in Q3- 2023.


Going forward, we will continue to operate within our strategic framework while focusing on micro markets and ecosystems. The principles of “Fair to Customer, Fair to Bank” and “One Bank, One Team, One RoE” will guide our operations. We focus on building a culture where every employee in the Bank serves customers with humility and upholds the values of brand ICICI. We aim to be the trusted financial services provider of choice for our customers and deliver sustainable returns to our shareholders.


With this, I conclude my opening remarks. I will be happy to take your questions.



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