ICICI Bank Q4FY18 disappoints, PAT drops 50% to Rs 1,020 cr; Chanda Kochhar's problems multiply

One of the largest private lenders ICICI Bank reported weak earnings during the fourth quarter ended March 2018 result. The bank posted net profit of Rs 1,020 crore which was down by a massive 49.62% from Rs 2,024.64 crore in the corresponding period of previous year. Q4FY18 net profit was also poor compared to earnings of Rs 1,650 crore of preceding quarter, as they witnessed a decline of 38.19%. However, net interest income (NII) came in at Rs 6,061.67 crore this quarter, registering gradual increase of 1.67% from Rs 5,962.16 crore in Q4FY17 and also up by 6.25% from Rs 5,705.27 crore of Q3FY18. 

The domestic net interest margin (NIM) was 3.67% and the overall net interest margin was 3.24% in Q4-2018. This was rise from previous quarter, where NIM stood at 3.14%. 

ICICI Bank surprisingly recorded provisions of Rs 6,625.75 crore in Q4FY18, surging by a whopping 128.61% as against Rs 2,898.22 crore a year ago same period. Also current provisions rose by 85.61% versus Rs 3,569.66 crore of preceding quarter. 

Provision coverage (including cumulative prudential/ technical write-offs) ratio increased by 690 bps from 53.6% at March 31, 2017 to 60.5% at March 31, 2018, further strengthening the balance sheet.

Gross non-performing assets (GNPA) of ICICI Bank stood at Rs 54,062.51 crore this quarter, higher by 27.05% from GNPA of Rs 42,551.54 crore in Q4FY17 and also up by 17.43% from Rs 46,038.70 crore in Q3FY18. 

Gross NPA additions of Rs 15,737 crore (US$ 2.4 billion) in Q4-2018. This includes Rs 9,968 crore (US$ 1.5 billion) of loans which were under RBI schemes and were classified as standard at December 31, 2017. 

In percentage terms, GNPA was at 8.84% in Q4FY18 higher from 7.82% in Q4FY17 and 7.89% in Q3FY18. 

For the period FY18, standalone profit stood at Rs 6,777.42 crore, shockingly declining by 30.85% in comparison with previous fiscal FY17 income were it was at Rs 9,801.09 crore. NII however, grew by 5.93% to Rs 23,025.84 crore this fiscal compared to FY17's Rs 21,737.32 crore. 

On consolidated front also the earning was weak, as profit after tax was at Rs  7,712 crore (US$ 1.2 billion) in FY2018 compared to Rs 10,188 crore (US$ 1.6 billion) in FY2017.

Consolidated assets grew by 14.1% from Rs 985,725 crore (US$ 151.2 billion) at March 31, 2017 to Rs 1,124,281 crore (US$ 172.5 billion) at March 31, 2018.

The Board has recommended a dividend of ` 1.50 per share (equivalent to dividend of US$ 0.046 per ADS). The declaration of dividend is subject to requisite approvals. The record/book closure dates will be announced in due course.

On BSE, ICICI Bank closed at Rs 289.40 per piece up by Rs 6.50 or 2.30%. Overall the share price surged by over 3%, as the bank touched intraday high of Rs 292 per piece today. 

The weak performance of ICICI Bank also comes as a trouble for Chanda Kochhar as many have already questioned her leadership under the bank. Since last month, controversy that erupted is over the CEO & MD of largest private-lender ICICI Bank having made personal gains in regards to loan given to Videocon in which her husband Deepak Kochhar's name has cropped up.