India’s No. 2 lender, ICICI Bank, beat street estimates on Monday with 21.6 per cent rise in second-quarter profit, led by higher income from interest and investments and lower provisions for bad loans.
The bank said its net profit in the September quarter rose to Rs 15.03 billion ($308.3 million) from Rs 12.36 billion a year earlier. Its net interest income grew nearly 14 per cent to Rs 25.1 billion, in line with estimates.
A Reuters poll had projected net profit at Rs 14.3 billion.
Its net non-performing assets as a percentage of total loans fell to 0.93 per cent at end-September from 1.62 per cent a year earlier.
Credit at Indian banks has been growing at a slower rate than deposits, with surging interest rates in Asia’s second-fastest growing major economy curbing spending on big-ticket purchases like cars and housing.
The Reserve Bank of India (RBI), which expects credit to grow by 18 per cent in the full fiscal year, raised interest rates on Tuesday for the 13th time in a tightening cycle that began in early 2010 to fight persistently high inflation.
Indian policy interest rates are at their highest since the global financial crisis in 2008, and many investors and corporate officials have been calling on the central bank to halt its policy tightening given the slowdown in growth.
ICICI Bank said its loans outstanding grew 20 per cent from a year earlier to Rs 2.34 trillion as of the end of September.
Shares of the lender, which the market values at nearly $22 billion, were up as much as 2.2 per cent to Rs 953.65 after the results. At 08.07 GMT, they were up 1.44 per cent at Rs 956.3 in a Mumbai market that was in negative territory.
They fell by a fifth during the quarter compared with a nearly 13 per cent fall in the benchmark BSE index. The BSE bank index fell 15.4 per cent in the period.