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ICICI Bank announces results for the quarter ended September 30, 2009

Mumbai, October 28, 2009: The Board of Directors of ICICI Bank Limited (NYSE: IBN) at its meeting held at Mumbai today, approved the audited unconsolidated accounts and the unaudited consolidated accounts of the Bank for the quarter ended September 30, 2009.

Performance Review – Quarter ended September 30, 2009

• 18% sequential increase in standalone profit after tax to Rs. 1,040 crore for the quarter ended September 30, 2009 from Rs. 878 crore for the quarter ended June 30, 2009
• 19% sequential decline in total provisions to Rs. 1,071 crore for the quarter ended September 30, 2009 from Rs. 1,324 crore for the quarter ended June 30, 2009
• 8% sequential decrease in operating and direct marketing agency expenses to Rs. 1,379 crore for the quarter ended September 30, 2009 from Rs. 1,494 crore for the quarter ended June 30, 2009
• Current and savings account (CASA) ratio increased to 36.9% at September 30, 2009 from 30.0% at September 30, 2008 and 30.4% at June 30, 2009
• Strong capital adequacy ratio of 17.7% and Tier-1 capital adequacy ratio of 13.3%; Tier-1 capital adequacy ratio highest among large Indian banks
• 76% increase in consolidated profit after tax to Rs. 1,145 crore for the quarter ended September 30, 2009 from Rs. 651 crore for the quarter ended September 30, 2008

Profit & loss account

• Profit after tax increased by 18% sequentially, to Rs. 1,040 crore (US$ 216 million) for the quarter ended September 30, 2009 (Q2- 2010) from Rs. 878 crore (US$ 183 million) for the quarter ended June 30, 2009 (Q1-2010). Profit after tax for the quarter ended September 30, 2008 (Q2-2009) was Rs. 1,014 crore (US$ 211 million).

• Net interest margin increased from 2.4% in Q1-2010 to 2.5% in Q2- 2010. Net interest income increased sequentially to Rs. 2,036 crore (US$ 423 million) for Q2-2010 from Rs. 1,985 crore (US$ 413 million) for Q1-2010. Net interest income was lower compared to Q2-2009 mainly due to the decrease in advances owing to the moderation in system credit growth, and decline in advances of overseas branches.

• Fee income increased sequentially to Rs. 1,387 crore (US$ 288 million) in Q2-2010 from Rs. 1,319 crore (US$ 274 million) in Q1- 2010. Fee income is in line with the reduced investment and mergers & acquisition activity in the corporate sector, reflecting the change in market conditions in the second half of fiscal 2009.

• Operating expenses (including direct marketing agency expenses) decreased by 8% to Rs. 1,379 crore (US$ 287 million) in Q2-2010 from Rs. 1,494 crore (US$ 311 million) in Q1-2010. The Bank achieved a reduction in the cost/average asset ratio to 1.5% in Q2- 2010 from 1.6% in Q1-2010.

• Total provisions decreased sequentially to Rs. 1,071 crore (US$ 223 million) in Q2-2010 from Rs. 1,324 crore (US$ 275 million) in Q1- 2010.



Balance sheet

The Bank has made further progress in its strategy of strengthening its deposit franchise. This is reflected in the Bank’s robust growth in savings and current account deposits and increase in the CASA ratio. The Bank continues to invest in expansion of its branch network to enhance its deposit franchise and create an integrated distribution network for both asset and liability products.

In line with the above strategy, the total deposits of the Bank were Rs. 197,832 crore (US$ 41.1 billion) at September 30, 2009, compared to Rs. 210,236 crore (US$ 43.7 billion) at June 30, 2009. During the quarter, the Bank’s savings account deposits increased by Rs. 4,859 crore (US$ 1,010 million) and current account deposits increased by Rs. 4,094 crore (US$ 851 million) resulting in an improvement in the CASA ratio to 36.9% at September 30, 2009 from 30.0% at September 30, 2008 and 30.4% at June 30, 2009.

The branch network of the Bank stood at 1,520 at October 26, 2009. The Bank is in the process of implementing the 580 branch licenses received from Reserve Bank of India which would expand the branch network to about 2,000 branches, giving the Bank a wide distribution reach in the country.

The loan book of the Bank decreased to Rs. 190,860 crore (US$ 39.7 billion) at September 30, 2009 from Rs. 198,102 crore (US$ 41.2 billion) at June 30, 2009 mainly due to the decrease in the agricultural loan portfolio in line with the seasonal nature of the business, and repayments from the retail loan portfolio, partly offset by increase in corporate advances.

Capital adequacy

The Bank’s capital adequacy at September 30, 2009 as per Reserve Bank of India’s Basel II norms was 17.7% and Tier-1 capital adequacy was 13.3%, well above RBI’s requirement of total capital adequacy of 9.0% and Tier-1 capital adequacy of 6.0%.

Asset quality

At September 30, 2009, the Bank’s net non-performing asset ratio was at the same level as June 30, 2009 at 2.19%. Total provisions decreased sequentially by 19% to Rs. 1,071 crore (US$ 223 million) in Q2-2010 from Rs. 1,324 crore (US$ 275 million) in Q1-2010.

Consolidated profits

Consolidated profit after tax of the Bank increased by 76% from Rs. 651 crore (US$ 135 million) in Q2-2009 to Rs. 1,145 crore (US$ 238 million) in Q2-2010, driven primarily by the sharp reduction in losses of ICICI Prudential Life Insurance Company (ICICI Life) and increase in profit of other subsidiaries.

Overseas banking subsidiaries

ICICI Bank Canada’s profit after tax for Q2-2010 was CAD 13.8 million. ICICI Bank Canada’s capital position continued to be strong with a capital adequacy ratio of 23.2% at September 30, 2009. ICICI Bank UK’s profit after tax for Q2-2010 was USD 12.6 million. ICICI Bank UK’s capital position continued to be strong with a capital adequacy ratio of 16.3% at September 30, 2009.

Q2 FY10 results for Insurance subsidiaries & asset company of ICICI

(This is a press release from ICICI Bank)