ICICI Bank Ltd, India’s biggest private sector lender by assets, reported a marginally better-than-expected 12 per cent rise in quarterly profit and said its bad-loan ratio fell sequentially, sending its shares more than 5 per cent higher.
Net profit rose to Rs 29.76 billion ($465 million) for its fiscal first quarter to June 30, from Rs 26.55 billion reported a year earlier, the lender, which is also listed in New York, said in a statement.
Analysts on average had expected ICICI Bank to report a net profit of Rs 29.2 billion, according to data compiled by Thomson Reuters.
Gross bad loans as a percentage of total loans fell to 3.68 per cent from 3.78 per cent in the March quarter although they were higher than the 3.05 per cent reported a year earlier.
Indian banks have seen their bad loans almost double in the past three years as a weak economy limited companies’ ability to service debt. While the dominant state-run lenders account for the majority of the bad loans, private sector lenders like ICICI have also seen their troubled loans rise.
Brokerage Ambit said this week it expected the pressure on ICICI’s asset quality to continue with fresh addition of bad loans and increased slippages from restructured loans.
ICICI’s first-quarter net interest income grew 14 percent over a year earlier, while non-interest income rose 5 per cent . Net interest margin rose to 3.54 per cent from 3.4 per cent a year earlier.
Retail loans grew 25 per cent, faster than the 15 per cent increase in overall credit.
At 1.17 pm, the shares of ICICI Bank were up 5.45 per cent at Rs 306.80 on BSE. On NSE, the shares were up 5.58 per cent at Rs 307.25 during the same time.