Sandeep Batra ICICI Bank: 5550 cr COVID-19 provision will cushion balance sheet

By | July 27, 2020 9:31 am

Sandeep Batra, President ICICI bank Ltd announces bank’s much-anticipated results, on Saturday, for the quarter ending June 30, 2020, and has recorded a profit after tax of INR 2599 cr – a significant 36% rise from the INR 1908 cr recorded in Q1-2020.

Sandeep Batra President ICICI BANK LTD

Picture courtesy – ICICI bank website

Loans under moratorium fell to 17.5%, as on June 30, from 30% in March: Sandeep Batra, ICICI Bank

  • Bank’s Q1 net profit rises 36% YoY to Rs. 2599 crore
  • Strong growth in advances and deposits may have positive impact on the stock exchanges

Several strategies adopted by the bank, including the necessary provisions for COVID-19, digitization of banking processes and a sale of 4% stake in ICICI Lombard General Insurance and a 1.5% stake in ICICI Prudential Life Insurance, have paid off and resulted in promising growth numbers for the lender in Q1-2021.

The bank has clocked a total capital adequacy ratio of 16.32% and tier-1 capital adequacy ratio of 14.93% on a standalone basis at June 30, 2020.

While there was a 42% decline YoY in provisions (excluding those made for COVID-19 and tax), the private lender has ensured that it has made an additional and significantly high COVID-19-related provisions of Rs 5550 cr. Sandeep Batra, President of ICICI Bank, said on the occasion, “We made the additional Covid-19 Provisions to the tune of INR 5,550 crore will cushion Balance Sheet” said Sandeep Batra, President, ICICI Bank – ICICI Bank Q1 Results analysis

Sandeep Batra said, “ICICI Bank’s loans under moratorium fell to 17.5%, as on June 30, from 30% in March. The bank continues to offer moratorium to those seeking it, after necessary diligence.”

Sandeep Batra talks about ICICI bank’s Profit & Loss Figures:

The bank saw its core operating profit (profit before tax and provisions, excluding treasury income), increase by 15% YoY from INR 6110 cr in Q1-2020 to INR 7014 cr in Q1-2021.

The lender has also observed a 20% increase in the net interest income (NII) with the figure reaching INR 9,280 cr in Q1-2021 from INR 7737 cr in Q1-2020. The net interest margin was 3.69% in Q1-2021 compared to 3.87% in the quarter ended March 31, 2020 (Q4-2020) and 3.61% in Q1-2020, reflecting the higher liquidity with the Bank due to strong deposit inflows and limited credit demand due to the lockdown.

Other Significant Results:

Credit Growth:

According to the results, the bank has seen a 10% YoY growth in domestic advances at June 30, 2020. During the same period, the retail loan portfolio grew by 11% YoY at June 30, 2020. As of June 30, 2020, retail accounted for 54.4% of the total portfolio, including non-fund outstanding. There was a noticeable growth in the performing domestic corporate portfolio by about 8% YoY, while the total advances also increased by 7% YoY from INR 592,415 cr at Q1-2020 to INR 631,215 cr at June 30, 2021.

Increase in Deposits:

ICICI Bank also witnessed an impressive increase in total deposits by 21% year-on-year to a whopping INR 801,622 cr at June 30, 2020. While the average current account deposits increased by 20% YoY in Q1-2021, the average savings account deposits also grew by 14% YoY in Q1-2021. The bank clocked an average CASA ratio of 41.0 % in Q1-2021 compared to 42.3% in Q4-2020 and 43.4% in Q1-2020. And last but not least, the lender also saw an increase in the total term deposits by 27% YoY to INR 461,007 cr at Q1-2021.

Digitization of Core Banking Processes:

During the COVID-19 outbreak, ICICI Bank was one of the early players to adopt new, cutting-edge technologies to digitize the banking processes to provide the most seamless banking experiences to their customers from the safety of their homes. Introduction of Video Know-Your-Customer (KYC) facility enabled them to onboard new customers by verifying their background remotely and in a completely contactless manner. This helped the bank gain new customers while ensuring the customers are not exposed to the risk of the virus Besides new savings account customers, the facility was also extended to salary account, personal loan account customers, and Amazon Pay Credit Card customers. The bank enabled businesses as well with its digital solutions – in one instance, an online food delivery platform was able to launch its digital wallet using the ICICI Bank Insta Wallet facility. The bank also saw its WhatsApp banking facility being adopted by more than 1 million customers – an impressive feat, considering the service was launched only 3 months back.

Thus despite the lockdown, ICICI Bank was able to attract and retain customers, providing them with the best of banking facilities remotely.

As per Technical Stock has strong Support in the range 350-357 Range as per Gann Analysis Breakout will be seen above 399 which can see rally towards 420/444 levels in Short term. 

Category: Daily

About Bramesh

Bramesh Bhandari has been actively trading the Indian Stock Markets since over 15+ Years. His primary strategies are his interpretations and applications of Gann And Astro Methodologies developed over the past decade.

One thought on “Sandeep Batra ICICI Bank: 5550 cr COVID-19 provision will cushion balance sheet

  1. sujatha

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