CEO-tainted ICICI Bank's Q4 profit crashes by 45%
New Delhi: ICICI Bank, which is facing conflict of interest allegations involving its chief Chanda Kochhar, on Monday posted a 45 per cent decline in consolidated net profit to Rs 1,142 crore for three months ended March as bad loans surged.
The leading private sector lender had a consolidated profit of Rs 2,083 crore in the January-March quarter of 2016-17.
The total income on consolidated basis rose to Rs 33,760 crore during the quarter as against Rs 28,603 crore.
On a standalone basis, the bank recorded a 50 per cent fall in net profit at Rs 1,020 crore in the latest fourth quarter. In the year-ago period, the same stood at Rs 2,025 crore.
However, standalone total income of the bank rose to Rs 19,943 crore in March quarter, from Rs 16,585.76 crore in preceding fiscal's last quarter, the bank said in a statement.
Net interest income also increased to Rs 6,022 crore in the quarter as compared to Rs 5,962 crore in the March quarter of the previous fiscal.
Gross non-performing assets (NPA) of the bank rose to 8.84 per cent as a percentage of gross advances at the end of March, compared to 7.89 per cent a year ago.
Net NPA, however, marginally declined to 4.77 per cent from 4.89 per cent.
As a result, the provisions and contingencies of the bank jumped to Rs 6,626 crore in the quarter under review as against Rs 2,898 crore in the same period previous fiscal.
The bank said there were gross NPA additions of Rs 15,737 crore, including Rs 9,968 crore of loans which were under RBI schemes and were classified as standard December 31, 2017.
On February 12, RBI issued a revised framework for resolution of stressed asset superseding its earlier guidelines, leading to accretion of NPAs.
The bank has classified three borrower accounts in the gems and jewellery sector with fund-based outstanding of Rs 794.87 crore as fraud and non-performing.
As a result, the bank made a provision of Rs 289.45 crore through profit and loss account and Rs 505.42 crore in the quarter by debiting reserves and surplus as permitted by the RBI.
Additionally, the bank has also made provision for certain other fraud and non-performing cases by debiting reserves and surplus amounting to Rs 19.98 crore.
The provision made by debiting reserves and surplus will be reversed and accounted through the profit and loss account over the subsequent quarters of the year ending March 31, 2019, it added.
Net interest margin increased from 3.14 per cent in the quarter ended December 31, 2017 to 3.24 per cent in the fourth and the last quarter, it said.
"The board recommended a dividend of Rs 1.50 per share(equivalent to dividend of $0.046 per ADS) for face value of Rs 2. The declaration of dividend is subject to requisite approvals. The record or book closure dates will be announced in due course," it said.
The annual results are announced at a time when the bank is grappling with a series of allegations of impropriety against its CEO Chanda Kochhar.
... But Board dodges Kochhar loan row
Mumbai: Despite many allegations of conflicts of interest being faced by managing director and chief executive Chanda Kochhar, the ICICI Bank board did not discuss the controversy on Monday.
"Today, there was no discussion at all on this issue.
The board has already clarified its stance," Kochhar said, when asked whether the controversial lending to the Videocon Group was discussed at the board meeting.
Asked about the silence maintained by her as well as the bank as more details get reported about the alleged misdoings, Kochhar referred to the March 28 statement from the board which stood firmly behind her.
"The board has made its stance very clear and we do not have anything more to add," Kochhar, who was speaking after the announcement of the bank's full-year results, said.
"(We are) talking of Q4 results now and we should focus on that. And I think the board has already clarified," she added.
The bank on Monday reported a 50 per cent plunge in standalone net at Rs 1,020 crore for the march quarter as provsions jumped threefold.
It can be noted that the ICICI Bank board had come out with a statement supporting Kochhar on the eve of the news getting out in the media. This was followed by a slew of reports of more alleged wrongdoings and also of there being a division within the board as well.
Kochhar on Monday confirmed that government nominee Lok Ranjan, a joint secretary in the department of financial services, was not able to attend the board meeting.
She also termed the board meeting scheduled for on Tuesday as a "routine" affair, where the top decision-making body will decide on its strategy and targets for the fiscal.
When asked about the dent to the brand and changes in workings after the controversy, Kochhar pointed out to the growth in deposits, which rose 14 per cent in FY18.