ICICI Bank turns losses into profit, bags Rs 909 crore in Q2FY19; provisions decline, despite higher gross NPA

Private lender ICICI Bank has missed analysts estimates during its second quarter of FY19(Q2FY19). However, the performance of ICICI Bank was quite interesting, where its provisions declined despite seeing higher gross NPA. One key positive was that ICICI Bank turned its quarter-on-quarter losses into profit in Q2FY19. However, this was still down in comparison to its yearly profits. The bank announced its Q2FY19 result after market hours, however this move did not not stop investors from dampening ICICI Bank shares, as they had closed earlier at Rs 315.05 per piece, down by 1.45%. 

ICICI Bank has posted a net profit of Rs 908.88 crore declining by 55.84% compared to net profit of Rs 2,058.19 crore in corresponding period of previous year. Q2FY19 was a profit as against loss of Rs 119.55 crore in Q1FY19. 

A Bloomberg poll of analysts had expected ICICI Bank's Q2FY19 PAT at Rs 949 crore. 

Net Interest Income (NII) of the bank was at Rs 6,437.58 crore in Q2FY19, which was up by 12.76% from Rs 5,709.07 crore in Q2FY18, also increasing by 5.50% from Rs 6,101.90 crore in Q1FY19.  

Net interest margin was 3.33% in Q2-2019 compared to 3.19% in Q1-2019.

The bank made provisions of Rs 3,994.29 crore in Q2FY19, down by 11.30% from Rs 4,502.93 crore in Q2FY18, and also below 33.11% as against Rs 5,971.29 crore in Q1FY19. 

On the other hand, ICICI Bank's gross NPA was at Rs 54,488.96 crore in Q2FY19, higher by 22.48% from Rs 44,488.54 crore in Q2FY18 and up by 1.92% as against Rs 53,464.94 crore in Q1FY19. 

Core operating profit (profit before provisions and tax, excluding treasury income) grew by 10% year-on-year to Rs 5,285 crore (US$ 729 million) in the quarter ended September 30, 2018 (Q2-2019). 

Domestic loan growth at 16% year-on-year at September 30, 2018 driven by retail  loans grew by 20% year-on-year and constituted 57% of the total loan portfolio. 

15% year-on-year growth was witnessed in current and savings account (CASA) deposits; outstanding CASA ratio at 50.8% at September 30, 2018. 

Total capital adequacy ratio of 17.84% and Tier-1 capital adequacy ratio of 15.38% on standalone basis at September 30, 2018.