ICICI Bank posted a 5.2% growth in net profit at Rs 12,359 crore for the quarter ended September, beating Bloomberg estimates of Rs 12,197 crore. Lower provisions aided the bank’s net profit in the quarter. However, the net profit fell 3.2% on a sequential basis. The provisions were down 26% to Rs 914 crore in Q2 from Rs 1,233 crore year ago. The bank’s total income stood at Rs 49,333 crore in Q2 from Rs 47,714 crore.
The fall in provisions has offset the low treasury income. The hardened bond yields during the period has impacted the lenders’ treasury income. The private lender reported a significant decline in treasury income to Rs 220 crore compared to Rs 680 crore in the year-ago quarter.
On the liability front, the bank’s average deposits grew 9.1% on year to Rs 15.57 lakh crore as of September 30. Within the deposits, average current account and savings account (CASA) ratio was 39.2%, up from 38.7% in Q1.
Domestic loans of the bank grew 10.6% on year to Rs 13.75 lakh crore as of September 30. Of the total loans, the retail loans grew 6.6% YoY, which constitutes 42.9% of the total book. The corporate loans rose 3.5% YoY.
“Given all the policy measures, both from a fiscal and monetary perspective, we do expect the second half to be better. There has been a GST rate cut. We hope the second half should reflect a better loan growth. We really remain positive on the overall loan growth going forward,” the bank said in the post-earnings media call.
Net interest income (NII) — the difference between interest earned and interest expended — increased 7.4% YoY to Rs 21,529 crore. Net interest margin (NIM), a key metric of the bank’s profitability, was 4.30% in Q2 compared to 4.34% in the previous quarter. “We expect NIM to remain rate-bound with some benefits expected from CRR cuts. However, there are pressures such as monetary policy, which will weigh on NIM trajectory. If there is a rate cut, there will be some anomaly impact on the NIM,” the bank said.
The bank’s asset quality improved in the second quarter. The gross non-performing asset (NPA) ratio fell to 1.58% in Q2 from 1.67% in the previous quarter, whereas net non-performing asset (NPA) was 0.39% compared to 0.41% in Q1FY26.
The bank also said it is well prepared for the transition to RBI’s new ECL framework and does not see any material impact from it. The private lender is well-capitalised with a capital adequacy ratio of 17% as of September 30.