The Board of Directors of ICICI Bank Limited (NYSE:IBN) at its meeting held at Mumbai today, approved the audited accounts of the Bank for the quarter ended September 30, 2010.

During the quarter, the Bank received approval of Reserve Bank of India (RBI) for merger of Bank of Rajasthan. The merger was effective from the close of business of August 12, 2010. The financials for Q2-2011 include the financials for erstwhile Bank of Rajasthan (e-BoR) for the period August 13, 2010 to September 30, 2010 (49 days). At the merger date, e-BoR had total assets of Rs. 15,596 crore (US$ 3.5 billion), advances of Rs. 6,528 crore (US$ 1.5 billion) and deposits of Rs. 13,483 crore (US$ 3.0 billion) including CASA deposits of Rs. 4,680 crore (US$ 1.0 billion).

Profit & loss account
  • Profit after tax increased 18.8% to Rs. 1,236 crore (US$ 275 million) for Q2-2011 from Rs. 1,040 crore (US$ 231 million) for Q2-2010.
  • Net interest income increased 8.3% to Rs. 2,204 crore (US$ 490 million) in Q2-2011 from Rs. 2,036 crore (US$ 453 million) in Q2-2010.
  • Fee income increased 14.6% to Rs. 1,590 crore (US$ 354 million) in Q2-2011 from Rs. 1,387 crore (US$ 309 million) in Q2-2010.
  • Operating expenses (including direct marketing agency expenses) increased 11.3% to Rs. 1,535 crore (US$ 342 million) in Q2-2011 from Rs. 1,379 crore (US$ 307 million) in Q2-2010, primarily due to the impact of new branches opened and increase in the number of employees.
  • Provisions decreased 40.2% to Rs. 641 crore (US$ 143 million) in Q2-2011 from Rs. 1,071 crore (US$ 238 million) in Q2-2010.

Balance sheet

The Bank continues to leverage its branch network to enhance its deposit franchise and create an integrated distribution network for both asset and liability products. At September 30, 2010, the Bank had 2,501 branches, the largest branch network among private sector banks in the country.

CASA deposits increased by 34.5% to Rs. 98,105 crore (US$ 21.8 billion) at September 30, 2010 from Rs. 72,930 crore (US$ 16.2 billion) at September 30, 2009 and the CASA ratio increased to 44.0% at September 30, 2010 from 36.9% at September 30, 2009. Total deposits of the Bank increased by 11.0% to Rs. 223,094 crore (US$ 49.6 billion) at September 30, 2010 from Rs. 200,913 crore (US$ 44.7 billion) at June 30, 2010

Advances increased by 5.3% to Rs. 194,201 crore (US$ 43.2 billion) at September 30, 2010 from Rs. 184,378 crore (US$ 41.0 billion) at June 30, 2010.

Capital adequacy

The Bank’s capital adequacy at September 30, 2010 as per Reserve Bank of India’s guidelines on Basel II norms was 20.2% and Tier-1 capital adequacy was 13.8%, well above RBI’s requirement of total capital adequacy of 9.0% and Tier-1 capital adequacy of 6.0%.

Asset quality

Net non-performing assets decreased by 30.0% to Rs. 3,192 crore (US$ 710 million) at September 30, 2010 from Rs. 4,558 crore (US$ 1,014 million) at September 30, 2009. The Bank’s net non-performing asset ratio decreased to 1.37% at September 30, 2010 from 2.19% at September 30, 2009. The Bank’s provisioning coverage ratio computed in accordance with the RBI guidelines at September 30, 2010 was 69.0% compared to 51.7% at September 30, 2009.

Consolidated profits

Consolidated profit after tax of the Bank increased by 21.8% to Rs. 1,395 crore (US$ 310 million) in Q2-2011 from Rs. 1,145 crore (US$ 255 million) in Q2-2010.

Insurance subsidiaries

ICICI Life maintained its position as the largest private sector life insurer based on retail new business weighted received premium during the six months ended September 30, 2010 (H1-2011). ICICI Life’s new business annualised premium equivalent (APE) increased by 10.9% to Rs. 1,344 crore (US$ 299 million) in Q2-2011 from Rs. 1,212 crore (US$ 270 million) in Q2-2010. ICICI Life’s renewal premium in Q2-2011 was Rs. 2,264 crore (US$ 504 million). ICICI Life’s unaudited new business profit (NBP) increased by 9.0% to Rs. 254 crore (US$ 57 million) in Q2-2011 from Rs. 233 crore (US$ 52 million) in Q2-2010. Assets held increased 30.7% to Rs. 65,484 crore (US$ 14.6 billion) at September 30, 2010 from Rs. 50,093 crore (US$ 11.1 billion) at September 30, 2009.

For Q2-2011, ICICI Prudential Life Insurance Company (ICICI Life) reported a profit after tax of Rs. 15 crore (US$ 3 million), before accounting for a surplus of Rs. 254 crore (US$ 57 million) in the non-participating policyholders’ funds, which would be transferred at the end of the financial year based on the appointed actuary’s recommendation. If this surplus were transferred in Q2-2011, the profit after tax of ICICI Life for the quarter would have been Rs. 269 crore (US$ 60 million) and the Bank’s consolidated profit after tax for Q2-2011 would have been Rs. 1,583 crore (US$ 352 million).

ICICI Lombard General Insurance Company (ICICI General) maintained its leadership in the private sector during H1-2011. ICICI General’s premium income in Q2-2011 increased by 36.2% to Rs. 1,091 crore (US$ 243 million) from Rs. 801 crore (US$ 178 million) in Q2-2010. ICICI General’s profit after tax was Rs. 104 crore (US$ 23 million) in Q2-2011 compared to Rs. 51 crore (US$ 11 million) in Q2-2010.

Summary Profit and Loss Statement (as per unconsolidated Indian GAAP accounts)

Rs. crore
 
  FY2010     Q1-2010   Q2-2010   H1-2010   Q1-2011   Q2-2011   H1-2011  
Net interest income 8,114     1,985   2,036   4,021   1,991   2,204     4,195  
Non-interest income 6,297     1,376   1,527   2,903   1,576   1,722     3,298  
- Fee income 5,650     1,319   1,387   2,706   1,413   1,590     3,003  
- Lease and other income 647     57   140   197   163   132     295  
Less:                              
Operating expense 5,593     1,467   1,358   2,825   1,425   1,500     2,925  
Expenses on direct market agents (DMAs) 1 125     27   21   48   36   35     71  
Lease depreciation 142     52   46   98   22   35     57  
Core operating profit 8,551     1,815   2,138   3,953   2,084   2,356     4,440  
Treasury income 1,181     714   297   1,011   104   (144 )   (40 )
Less: Provisions 4,387     1,324   1,071   2,395   798   641     1,439  
Profit before tax 5,345     1,205   1,364   2,569   1,390   1,571     2,961  
Less: Tax 1,320     327   324   651   364   335     699  
Profit after tax 4,025     878   1,040   1,918   1,026   1,236     2,262  
             

1. Represents commissions paid to direct marketing agents (DMAs) for origination of retail loans. These commissions are expensed upfront.

2. Prior period figures have been regrouped/re-arranged where necessary.
 

Summary Balance Sheet

Rs. crore
   

March 31,2010
 

September 30,2009
 

September 30,2010
Assets            
Cash & bank balances   38,874   29,267   34,848
Advances   181,206   190,860   194,201
Investments   120,893   119,965   136,275
Fixed & other assets   22,427   26,282   24,674
Total   363,400   366,374   389,998
Liabilities            
Net worth   51,618   51,258   53,975
- Equity capital   1,115   1,114   1,151
- Reserves   50,503   50,144   52,824
Deposits   202,017   197,832   223,094
CASA ratio   41.7%   36.9%   44.0%
Borrowings 1   94,264   100,123   97,010
Other liabilities   15,501   17,161   15,919
Total   363,400   366,374   389,998
     

1. Borrowings include preference shares amounting to Rs. 350 crore.
 

All financial and other information in this press release, other than financial and other information for specific subsidiaries where specifically mentioned, is on an unconsolidated basis for ICICI Bank Limited only unless specifically stated to be on a consolidated basis for ICICI Bank Limited and its subsidiaries. Please also refer to the statement of audited unconsolidated, consolidated and segmental results required by Indian regulations that has, along with this release, been filed with the stock exchanges in India where ICICI Bank’s equity shares are listed and with the New York Stock Exchange and the US Securities Exchange Commission, and is available on our website www.icicibank.com.

Except for the historical information contained herein, statements in this release which contain words or phrases such as 'will', ‘expected to’, etc., and similar expressions or variations of such expressions may constitute 'forward-looking statements'. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results, opportunities and growth potential to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the actual growth in demand for banking and other financial products and services in the countries that we operate or where a material number of our customers reside, our ability to successfully implement our strategy, including our use of the Internet and other technology, our rural expansion, our exploration of merger and acquisition opportunities, our ability to integrate recent or future mergers or acquisitions into our operations and manage the risks associated with such acquisitions to achieve our strategic and financial objectives, our ability to manage the increased complexity of the risks we face following our rapid international growth, future levels of impaired loans, our growth and expansion in domestic and overseas markets, the adequacy of our allowance for credit and investment losses, technological changes, investment income, our ability to market new products, cash flow projections, the outcome of any legal, tax or regulatory proceedings in India and in other jurisdictions we are or become a party to, the future impact of new accounting standards, our ability to implement our dividend policy, the impact of changes in banking regulations and other regulatory changes in India and other jurisdictions on us, including on the assets and liabilities of ICICI, a former financial institution not subject to Indian banking regulations, the bond and loan market conditions and availability of liquidity amongst the investor community in these markets, the nature of credit spreads, interest spreads from time to time, including the possibility of increasing credit spreads or interest rates, our ability to roll over our short-term funding sources and our exposure to credit, market and liquidity risks as well as other risks that are detailed in the reports filed by us with the United States Securities and Exchange Commission. ICICI Bank undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof.

The amalgamation of Bank of Rajasthan and any future acquisitions or mergers may involve a number of risks, including deterioration of asset quality, diversion of our management’s attention required to integrate the acquired business and the failure to retain key acquired personnel and clients, leverage synergies or rationalise operations, or develop the skills required for new businesses and markets, or unknown and known liabilities, some or all of which could have an adverse effect on our business.

This release does not constitute an offer of securities.

1 crore = 10.0 million

US$ amounts represent convenience translations at US$1= Rs. 44.94

AUDITED UNCONSOLIDATED FINANCIAL RESULTS

 (Rs. in crore)
Sr. No. Particulars   Three months ended   Half year ended   Year ended
  September 30, 2010   September 30, 2009   September 30, 2010   September 30, 2009   March 31, 2010
      (Audited)   (Audited)   (Audited)   (Audited)   (Audited)
1. Interest earned (a)+(b)+(c)+(d)   6,309.10     6,656.94     12,121.64     13,790.38     25,706.93  
a) Interest/discount on advances/bills   3,949.17     4,493.03     7,727.70     9,579.59     17,372.73  

b) Income on investments
  1,916.13     1,627.99     3,574.68     3,204.09     6,466.35  

c) Interest on balances with Reserve Bank of India and other inter-bank funds
  82.30     185.68     180.36     386.40     624.99  
  d) Others   361.50     350.24     638.90     620.30     1,242.86  
2. Other income   1,577.93     1,823.79     3,258.44     3,913.67     7,477.65  
3. TOTAL INCOME (1)+(2)   7,887.03     8,480.73     15,380.08     17,704.05     33,184.58  
4. Interest expended   4,104.72     4,620.87     7,926.21     9,769.05     17,592.57  
5. Operating expenses (e)+(f)+(g)   1,570.37     1,424.53     3,053.86     2,970.55     5,859.83  
e) Employee cost   624.26     449.55     1,199.85     916.07     1,925.79  
f) Direct marketing expenses   35.48     20.90     71.29     48.40     125.48  
g) Other operating expenses   910.63     954.08     1,782.72     2,006.08     3,808.56  
6. TOTAL EXPENDITURE (4)+(5)

(excluding provisions and contingencies)
  5,675.09     6,045.40     10,980.07     12,739.60     23,452.40  
7. OPERATING PROFIT (3)–(6)

(Profit before provisions and contingencies)
  2,211.94     2,435.33     4,400.01     4,964.45     9,732.18  
8. Provisions (other than tax) and contingencies   641.14     1,071.30     1,438.96     2,394.95     4,386.86  
9. Exceptional items  

..
   

..
   

..
   

..
   

..
 
10. PROFIT/(LOSS) FROM ORDINARY ACTIVITIES BEFORE TAX (7)–(8)–(9)   1,570.80     1,364.03     2,961.05     2,569.50     5,345.32  
11. Tax expense (h)+(i)   334.53     323.90     698.80     651.15     1,320.34  
h) Current period tax   495.10     402.29     1,010.20     795.34     1,600.78  
i) Deferred tax adjustment   (160.57 )   (78.39 )   (311.40 )   (144.19 )   (280.44 )
12. NET PROFIT/(LOSS) FROM ORDINARY ACTIVITIES (10)–(11)   1,236.27     1,040.13     2,262.25     1,918.35     4,024.98  
13. Extraordinary items (net of tax expense)  

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..
   

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14. NET PROFIT/(LOSS) FOR THE PERIOD (12)–(13)   1,236.27     1,040.13     2,262.25     1,918.35     4,024.98  
15.

Paid-up equity share capital (face value Rs. 10/-)
  1,150.83     1,113.60     1,150.83     1,113.60     1,114.89  
16. Reserves excluding revaluation reserves   52,824.02     50,144.66     52,824.02     50,144.66     50,503.48  
17. Analytical ratios                    
i) Percentage of shares held by Government of India  

..
   

..
   

..
   

..
   

..
 
ii) Capital adequacy ratio   20.23 %   17.69 %   20.23 %   17.69 %   19.41 %
iii) Earnings per share (EPS)                    

a) Basic EPS before and after extraordinary items, net of tax expenses (not annualised for quarter/period) (in Rs.)
  10.91     9.34     20.11     17.23     36.14  

b) Diluted EPS before and after extraordinary items, net of tax expenses (not annualised for quarter/period) (in Rs.)
  10.86     9.30     20.03     17.17     35.99  
18.

NPA Ratio 1,2
                   
i) Gross non-performing advances (net of write-off)   10,141.16     9,200.89     10,141.16     9,200.89     9,480.65  
ii) Net non-performing advances   3,145.23     4,499.05     3,145.23     4,499.05     3,841.11  
iii) % of gross non-performing advances

(net of write-off) to gross advances
  5.03 %   4.69 %   5.03 %   4.69 %   5.06 %
iv) % of net non-performing advances to net advances   1.62 %   2.36 %   1.62 %   2.36 %   2.12 %
19. Return on assets (annualised)   1.31 %   1.17 %   1.23 %   1.06 %   1.13 %
20. Public shareholding                    
i) No. of shares   1,147,919,537     1,113,564,145     1,147,919,537     1,113,564,145     1,114,845,314  
ii) Percentage of shareholding   100     100     100     100     100  
21. Promoter and promoter group shareholding                    
i) Pledged/encumbered                    
a) No. of shares  

..
   

..
   

..
   

..
   

..
 
b) Percentage of shares (as a % of the total shareholding of promoter and promoter group)  

..
   

..
   

..
   

..
   

..
 
c) Percentage of shares (as a % of the total share capital of the bank)  

..
   

..
   

..
   

..
   

..
 
ii) Non-encumbered                    
a) No. of shares  

..
   

..
   

..
   

..
   

..
 
b) Percentage of shares (as a % of the total shareholding of promoter and promoter group)  

..
   

..
   

..
   

..
   

..
 
c) Percentage of shares (as a % of the total share capital of the bank)  

..
   

..
   

..
   

..
   

..
 
 

1.

  At June 30, 2010, the gross non-performing advances (net of write-off) were Rs. 9,829.03 crore and the net non-performing advances were Rs. 3,456.18 crore. The percentage of gross non-performing advances (net of write-off) to gross advances (net of write-off) was 5.14% and percentage of net non-performing advances to net advances was 1.87% at June 30, 2010.

2.

  The percentage of gross non-performing customer assets to gross customer assets was 4.24% and net non-performing customer assets to net customer assets was 1.37% at September 30, 2010. Customer assets include advances and credit substitutes.
 

SUMMARISED UNCONSOLIDATED BALANCE SHEET

(Rs. in crore)
Particulars   At
  September 30, 2010   September 30, 2009   March 31,

2010
    (Audited)   (Audited)   (Audited)
Capital and Liabilities            
Capital   1,150.83   1,113.60   1,114.89
Reserves and surplus   52,824.02   50,144.66   50,503.48
Deposits   223,094.12   197,832.05   202,016.60
Borrowings (includes preference shares and subordinated debt)   97,009.75   100,123.15   94,263.57
Other liabilities   15,919.28   17,160.68   15,501.17
Total Capital and Liabilities   389,998.00   366,374.14   363,399.71
             
Assets            
Cash and balances with Reserve Bank of India   22,867.21   20,038.84   27,514.29
Balances with banks and money at call and short notice   11,980.60   9,227.80   11,359.40
Investments   136,275.51   119,964.82   120,892.80
Advances   194,200.72   190,860.18   181,205.60
Fixed assets   4,780.83   3,551.57   3,212.69
Other assets   19,893.13   22,730.93   19,214.93
Total Assets   389,998.00   366,374.14   363,399.71
   
CONSOLIDATED FINANCIAL RESULTS

(Rs. in crore)
Sr. No. Particulars   Three months ended   Half year ended   Year ended
  September 30, 2010   September 30, 2009   September 30, 2010   September 30, 2009   March 31,2010
      (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)   (Audited)
1. Total income   14,464.55   14,595.85   27,999.86   29,210.91   59,599.77
2. Net profit   1,394.94   1,144.57   2,485.94   2,179.83   4,670.29
3. Earnings per share (EPS)                    

a) Basic EPS (not annualised for quarter/period) (in Rs.)
  12.31   10.28   22.10   19.58   41.93
 

b) Diluted EPS (not annualised for quarter/period) (in Rs.)
  12.23   10.23   21.98   19.49   41.72
       
UNCONSOLIDATED SEGMENTAL RESULTS OF ICICI BANK LIMITED

(Rs. in crore)
Sr. No. Particulars   Three months ended   Half year ended   Year ended
  September 30, 2010   September 30, 2009   September 30, 2010   September 30, 2009   March 31, 2010
      (Audited)   (Audited)   (Audited)   (Audited)   (Audited)
1. Segment revenue                    
a Retail Banking   3,943.78   4,497.08   7,771.56   9,433.26   17,724.41
b Wholesale Banking   4,625.18   5,041.26   8,840.07   10,635.16   19,254.13
c Treasury   5,597.34   6,403.42   11,116.14   13,767.01   24,797.80
d Other Banking   130.73   185.21   204.48   239.12   437.57
  Total revenue   14,297.03   16,126.97   27,932.25   34,074.55   62,213.91
  Less: Inter segment revenue   6,410.00   7,646.24   12,552.17   16,370.50   29,029.33
  Income from operations   7,887.03   8,480.73   15,380.08   17,704.05   33,184.58
2. Segmental results (i.e. Profit before tax)                    
a Retail Banking   (116.74)   (321.89)   (334.07)   (759.22)   (1,333.51)
b Wholesale Banking   1,210.68   948.98   2,140.52   1,525.63   3,645.10
c Treasury   430.97   599.71   1,087.12   1,697.70   2,788.64
d Other Banking   45.89   137.23   67.48   105.39   245.09
  Total segment results   1,570.80   1,364.03   2,961.05   2,569.50   5,345.32
  Unallocated expenses                    
  Profit before tax   1,570.80   1,364.03   2,961.05   2,569.50   5,345.32
3. Capital employed

(i.e. Segment assets – Segment liabilities)
                   
a Retail Banking   (72,171.99)   (36,027.33)   (72,171.99)   (36,027.33)   (44,905.31)
b Wholesale Banking   45,168.68   32,727.46   45,168.68   32,727.46   26,929.31
c Treasury   74,327.81   48,520.41   74,327.81   48,520.41   63,238.40
d Other Banking   724.74   606.56   724.74   606.56   470.63
e Unallocated   5,925.61   5,431.16   5,925.61   5,431.16   5,885.34
  Total   53,974.85   51,258.26   53,974.85   51,258.26   51,618.37

Notes on segmental results:
  1. The disclosure on segmental reporting has been prepared in accordance with Reserve Bank of India (RBI) circular no. DBOD.No.BP.BC.81/21.04.018/2006-07 dated April 18, 2007 on guidelines on enhanced disclosures on ”Segmental Reporting” which is effective from the reporting period ended March 31, 2008.
  2. “Retail Banking” includes exposures which satisfy the four criteria of orientation, product, granularity and low value of individual exposures for retail exposures laid down in Basel Committee on Banking Supervision document “International Convergence of Capital Measurement and Capital Standards: A Revised Framework”.
  3. “Wholesale Banking” includes all advances to trusts, partnership firms, companies and statutory bodies, which are not included under Retail Banking.
  4. “Treasury“ includes the entire investment portfolio of the Bank.
  5. “Other Banking” includes hire purchase and leasing operations and other items not attributable to any particular business segment.

Notes:

1. The financial statements have been prepared in accordance with Accounting Standard (AS) 25 on ‘Interim Financial Reporting’.

2. The Bank of Rajasthan Limited (Bank of Rajasthan), a banking company incorporated under the Companies Act, 1956 and licensed by RBI under the Banking Regulation Act, 1949 was amalgamated with ICICI Bank Limited (ICICI Bank) with effect from close of business of August 12, 2010 in terms of the Scheme of Amalgamation (the Scheme) approved by RBI vide its order DBOD No. PSBD 2603/16.01.128/2010-11 dated August 12, 2010 under sub section (4) of section 44A of the Banking Regulation Act, 1949. The consideration for the amalgamation was 25 equity shares of ICICI Bank of the face value of Rs. 10/- each fully paid-up for every 118 equity shares of Rs. 10/- each of Bank of Rajasthan. Accordingly, on August 26, 2010, ICICI Bank allotted 31,323,951 equity shares to the shareholders of Bank of Rajasthan and 2,860,170 equity shares have been kept in abeyance pending civil appeal and regulatory direction, which have been included in paid-up capital of the Bank.

3. The net loss of ICICI Prudential Life Insurance Company (ICICI Life) for the half year ended September 30, 2010 (H1-2011) was Rs. 100.99 crore and the net profit after tax for the quarter ended September 30, 2010 (Q2-2011) was Rs. 14.90 crore. In the non-participating policyholders’ funds, there was a surplus of Rs. 488.88 crore, net of deferred tax, for H1-2011 and Rs. 254.17 crore, net of deferred tax, for Q2-2011. The surplus in the non-participating funds would be transferred at the end of the financial year based on the appointed actuary’s recommendation. If this surplus were transferred, the net profit after tax of ICICI Life would have been Rs. 387.89 crore for H1-2011 and Rs. 269.07 crore for Q2-2011 and the Bank's consolidated net profit after tax would have been Rs. 2,847.17 crore for H1-2011 and Rs. 1,582.75 crore for Q2-2011.

4. The provision coverage ratio of the Bank at September 30, 2010, computed as per the RBI circular dated December 1, 2009, is 69.0% (June 30, 2010: 64.8% and March 31, 2010: 59.5%). The Bank has been permitted by RBI to achieve the stipulated level of 70% in a phased manner by March 31, 2011.

5. During the three months ended September 30, 2010, the Bank has allotted 1,137,103 equity shares of Rs. 10/- each pursuant to exercise of employee stock options.

6. Status of equity investors’ complaints/grievances for the three months ended September 30, 2010:
                Opening balance   Additions   Disposals   Closing balance
3   20   23   0

7. Previous period/year figures have been re-grouped/re-classified where necessary to conform to current period classification.

8. The above financial results have been approved by the Board of Directors at its meeting held on October 29, 2010.

9. The above unconsolidated financial results for the three months and the half year ended September 30, 2010 are audited by the statutory auditors, S.R. Batliboi & Co., Chartered Accountants. The unconsolidated financial results for the year ended March 31, 2010 have been audited by another firm of chartered accountants.

10. Rs. 1 crore = Rs. 10 million.

N. S. Kannan Executive Director & CFO

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