Provisioning on account of treasury portfolio and retail bad loans have pulled down ICICI Bank?s first quarter net profit to Rs 728 crore, down nearly 6%, from Rs 775 crore in the year-ago quarter.

High interest rates and adverse market conditions significantly affected the bank?s trading portfolio and SLR securities portfolio and its treasury income during the quarter, the bank?s joint managing director Chanda Kochhar said, adding that the bank has not made any additional provisioning for its credit derivatives portfolio during the quarter.

?High interest rates have had an impact on our quarterly results. However, the corporate and international segments grew by nearly 65% in the quarter and we expect this to grow by around 25% going forward,” Kochhar said.

The bank made a total mark-to-market (MTM) provisioning of Rs 594 crore during the quarter owing to the depreciation in its bond and equity portfolios, she said.

The net NPAs of the bank, during the quarter, rose to Rs 4,033.57 crore (1.8 %), compared to Rs 2,674.19 crore (1.35 %) in the year-ago period, while gross NPAs went up to Rs 8,511.36 crore (3.72 %) from Rs 5,292.04 crore (2.63 %). ICICI Bank and its subsidiaries had consolidated total assets of Rs. 484,643 crore during the quarter.

The bank?s savings account deposits increased 35% to Rs. 43,465 crore during the quarter, up from Rs. 32,121 crore. Current and savings account (CASA) deposits constituted 27.6% of total deposits at June 30, 2008 compared to 22.4% at June 30, 2007.

?Retail loans come to around 56 % of our total loan portfolio. That has contributed to the bad loans as well,” she said.

The bank expects that the segment would grow at 5% in this fiscal, Kochhar said.

With the lending rates moving northward, the bank has seen a visible impact on the demand for new loans during the first quarter, Kochhar added. Total advances, including the overseas banking

subsidiaries and ICICI Home Finance, jumped by 20% during the quarter to Rs 2,57,287 crore from Rs 2,15,293 crore in the year-ago period.

The net interest income rose to Rs 2,090 crore, up 41% from Rs 1,479 crore in the corresponding quarter in last year while the fee-income increased 37% to Rs 1,958 crore as compared to Rs 1,428 crore in the year-ago period, the bank said.

The total income of the bank rose to Rs 9,429.98 crore in the latest quarter, from Rs 9,281.42 crore in the year-ago period while total assets, including its subsidiaries, stood at Rs 4,84,643 crore as on June 30, 2008. ICICI Bank?s overseas subsidiaries, ICICI Bank UK and ICICI Bank Canada raised $1.5 billion worth retail deposits in the first quarter, it said.

Besides, the bank?s remittance volumes increased by 35% in the first quarter this year to about Rs 11,400 crore. The bank?s capital adequacy ratio as on June 30 stood at 13.42%.