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Informist, Saturday, Jul. 18, 2026

 

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--ICICI Bank: Momentum on loan growth continues to be good 
--CONTEXT: Comments from ICICI Bank mgmt in analyst call post Q1 earnings
--ICICI Bank:FCNR deposit cost lower than wholesale, will use for loan growth 
--ICICI Bk:Comfortable with business banking growth but monitoring it closely
--ICICI Bank: Cards an area where fee income lower than potential Q1
--ICICI Bank: Seen no change in customer behaviour on liability side 

 

By Aaryan Khanna and Simran Rede

 

NEW DELHI/MUMBAI – The momentum in loan growth continues to be strong so far, with no signs of a slowdown yet and adequate opportunities to find good-quality customers, ICICI Bank's management told analysts in a post-earnings conference call. The bank's total advances rose nearly 20% on year and 5.0% sequentially to INR 16.31 billion at the end of the June quarter

 

Lending momentum had picked up in the June quarter as bond markets had not favoured corporate customers, pushing them to tap bank loans and working capital to fund revenue and capital expenditure. The government and Reserve Bank of India's schemes had also bolstered credit offtake, the management of the country's second-largest private sector bank said. As of Jun. 30, the domestic corporate loan portfolio was up 18.5% on year at INR 3.27 trillion.

 

The pipeline in the corporate loan boak had been favourable and available at "decent" rates, the management said. ICICI Bank would focus on the value proposition for lending to customers rather than get into intensely competitive segments to grow its loan portfolio.

 

International branches had also seen sustained momentum in loan growth over the past two quarters, which will be further bolstered by lending to customers as leverage for foreign currency non-resident (bank) deposits, the management said. The central bank had introduced several measures to attract foreign capital in June, including a swap facility that allows banks to hedge their 3-5 year FCNR(B) deposits mobilised until Sept. 30 at no cost.

 

ICICI Bank executives declined to set a target for the quantum of deposits the bank would raise under the scheme, but said that the cost would be lower than seeking wholesale and bulk deposits. Moreover, it would allow the bank to continue growing its loan book at a robust pace, they said. ICICI Bank's credit-to-deposit ratio stood at 89% at the end of June, suggesting it was funding credit through costly measures, including certificates of deposit. On Friday, Informist reported the RBI had set a target of $20 billion for private sector banks under the scheme. Earlier in the day, the management told the media FCNR(B) deposits were likely to dilute its net interest margin, which was at 4.36% in the June quarter.

 

The bank said it was factoring in the potential impact of the West Asia war and recent flare-ups in customer selection and onboarding. While this led to increased monitoring of the business banking loan book, the management was fundamentally comfortable with growing the portfolio. The portfolio – which comprises borrowers up to INR 7.50 billion – was reasonably secure, granular, and had not seen a rise in bad loans. Business banking loans were up 28.2% on year and 6.9% on quarter to INR 3.50 trillion as of Jun. 30.

 

The management said business banking loans were also up due to loans disbursed under the Emergency Credit Line Guarantee Scheme 5.0, which was launched in May to extend credit support to Indian businesses amid uncertainties related to the war in West Asia. ICICI Bank was getting some inquiries and offering loans under the scheme for the benefit of customers, the management said. On personal loans, the executives declined to give guidance but said there was no reason why the growth in personal loans would slow from the 4% on-quarter pace seen in Apr-Jun.

 

The creation of non-performing assets had also slowed in retail loans, especially in the unsecured segment, the management said. The bank's gross NPA additions from retail and rural loans fell to INR 43.31 billion in the June quarter from INR 51.93 billion a year ago, with Kisan Credit Card-linked additions only marginally lower at INR 7.06 billion. On the liability side, the management said it had seen no change retail customer behaviour, with a stable inflow into savings.

 

Executives reiterated the bank's commitment to growing its profit before tax excluding treasury income, which rose 20.9% on year to INR 189.75 billion in Apr-Jun. The bank also saw an opportunity to expand its fee income across verticals, with the 23% on-year growth in the segment a function of a low base. 

 

"As you said, maybe cards is one area where fee growth is less than what we would want it to be," the management said in response to a question. "Although, you know, at a PBT (profit before tax) level, the business has done very well because of the reduction in credit costs."  

 

Earlier Saturday, ICICI Bank reported a net profit of INR 148.05 billion for the June quarter, growing at five-quarter high of 16% on year. The lender's shares ended 1.8% higher at INR 1,444.30 on the National Stock Exchange on Friday.  End

 

US$1 = INR 96.28

 

Edited by Avishek Dutta

 

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