largest private sector lender ICICI Bank on Wednesday reported a five-times jump in March quarter net at Rs2,082.75 crore, but the asset quality woes which had dented its bottomline year-ago, continued to persist.
On a standalone basis, profit soared to Rs2,024.64 crore from Rs701.89 crore in the year-ago period but was down from Rs2,441 crore in the December quarter.
The bottomline was helped massively by dipping into a specially made provision in the past and the bank used Rs1,528 crore of the money during the reporting quarter, managing director and chief executive Chanda Kochhar told reporters during an earnings concall.
She said the entire Rs5,100 crore set aside in the past to protect the bottomlines has been completely utilised by the March quarter.
Total slippages for the reporting quarter was over Rs11,000 crore, including a Rs5,378 crore to a cement company which is bound to be acquired soon, while the bank wrote off a high Rs5,386 crore of assets as per a laid down policy and recovery and upgrades were at Rs1,400 crore.
Kochhar said a part of the loan will be upgraded once the cement company's (JP Cements, which has been acquired by the Birla's led UltraTech Cement and is pending regulatory approvals) sale is completed.
Its 'drilldown' account list, which included low-rated accounts from five stressed sectors, has come massively narrowed to Rs19,000 crore from Rs44,000 crore at the start of the fiscal, she said, adding Rs20,000 crore of this went down as NPAs as of March.
The gross non-performing assets ratio shot up to 7.89 per cent from 5.21 per cent in the year-ago period and 7.20 per cent in the December quarter. The total provisions went down to Rs2,898.22 crore from Rs3,326.21 crore in the year- ago period and provision coverage ratio dipped to 53.6 per cent from 61 per cent in the year-ago period.
However, Kochhar said NPA additions in fiscal 2018 will be "significantly lower" and the bank also expects resolutions of the already classified assets which can result in write-backs on NPAs during the year.
"We are watching the progress and it depends on the external environment. You also need to understand that it is five sectors. Work on resolution is on but we will have to watch it on a case-by-case basis," she said.
She said RBI's supervision found Rs5,105 crore divergences in fiscal 2016, where the bank hadn't classified certain accounts as NPAs, but 40 per cent of them were recognised as NPAs in the first quarter of fiscal 2017 itself.