ICICI Bank, on Wednesday, reported a 13 per cent rise in its net profit at Rs.2,532 crore for the third quarter ended December 30, 2013, the slowest pace of increase in four years, helped by growth in interest income and treasury gains.
The bank had posted a net profit of Rs.2,250 crore in the same quarter in 2012-13.
On a consolidated basis, the profit rose by 9 per cent to Rs.2,872 crore during the said quarter, with its insurance subsidiaries reporting good sets of numbers.
Net interest income grew 22 per cent to Rs.4,255 crore, while non-interest income was up 26 per cent at Rs.2,801 crore, helped by treasury profit. The pre-tax profit from treasury operations rose to Rs.1,397.16 crore from Rs.934.49 crore a year ago.
The net interest margin expanded to 3.32 per cent compared with 3.07 per cent last year. Chief Executive Officer and Managing Director Chanda Kochhar said the bank would be able to sustain the net interest margin at these levels.
Profit growth was restrained by an additional provision of Rs.215 crore toward deferred tax liabilities on special reserves for the nine-months ending December.
Ms. Kochhar said henceforth the bank would set aside up to Rs.70 crore every quarter for the tax liabilities, in accordance with the RBI norms.
A spike in asset stress resulted in provisions for loan losses increasing to Rs.695 crore as against Rs.625 crore last year, Ms. Kochhar said.
During the reporting quarter, the bank added Rs.1,230 crore to its gross non-performing assets (NPAs). Net advances to companies with restructured loans increased by Rs.1,776 crore to Rs.8,602 crore. Ms. Kochhar said the gloom on the economic front was far from over and she believed there would be additions to NPAs and restructured assets for the next two quarters.
The bank had a recast loan pipeline of Rs.3,000 crore, she added.
She said stress on assets was not sector-specific but group or company-specific and emanating across sectors. It was able to maintain the cost-to-income ratio at 37 per cent and was targeting to keep it under 40 per cent, Ms. Kochhar said.
ICICI Bank shares gave up initial gains, and declined 1.69 per cent to Rs.1,001.95 at the close on the BSE.