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Informist, Saturday, Jan. 17, 2026

 

--ICICI Bank: Loan-to-deposit ratio comfortable, may moderate marginally 

--CONTEXT: Comments by ICICI Bank mgmt at post-earnings call with analysts 

 

By Priyasmita Dutta and Shubham Rana

 

NEW DELHI – ICICI Bank Ltd.'s loan-to-deposit ratio, or credit-deposit ratio is at a comfortable level, and may moderate marginally going ahead, the lender's management said in a post-earnings analyst call Saturday. The private sector lender's CD ratio at the end of Dec. 31 was 87.4%, higher than 86.3% end of September, and 85.4% end of December last year.

 

"This quarter (December quarter), I think for the entire system and for us (ICICI Bank) and most banks, the LDR (loan-to-deposit ratio) would have gone up because of the CRR cut," its management said. The central bank had in June cut banks' cash reserve ratio by 100 basis points to 3%, implemented in four equal tranches between September and November.

 

"I think given the current level of capital that we hold and the regulatory requirements of liquidity, this (87.4%) is a okay level. I don't see it going up from here. It can moderate marginally, but we are quite comfortable at this level in terms of our funding side," the lender said.

 

The bank said it wants to maximise retail deposits, including current account savings account deposits, to maintain capital, and then look at the different types of wholesale funding available, like refinance bonds, wholesale deposits and so on. "And our reliance on wholesale deposits is pretty moderate," its management said.

 

The private sector lender's capital adequacy ratio was 17.34% end of December, higher than 17% end of September. In the December quarter, ICICI Bank's credit growth outpaced its deposit growth. Its total advances grew 11.5% on year to INR 14.66 trillion, while total deposits grew 9.2% on year to INR 16.60 trillion.

 

Going ahead, ICICI Bank will focus on maximising pre-provision operating profit. "We will work towards maximising the ppop (pre-provision operating profit) and, you know, not really cutting costs per se, but definitely leveraging it as well as we can," the management said. Its core operating profit grew 6% on year to INR 175 billion in the December quarter, after an impact of INR 1.45 billion due to the new labour codes. "The (Labour) Code will marginally increase the recurring operating costs but that's something we'll have to just absorb as we go forward," the management said.

 

The bank reported a net profit of INR 113.18 billion for the December quarter, down 4% on year, the first fall in over six years, due to jump in provisions. The bank reported provisions of INR 25.56 billion for Oct-Dec, more than double of INR 12.27 billion in the year-ago period. The provisions included additional standard asset provision of INR 12.83 billion made pursuant to RBI's annual supervisory review on agricultural priority sector loans due to non-compliance with regulation for classification. If not for the additional provisions, the net profit would have been up 4.1%. On Friday, shares of the bank ended 0.5% lower at INR 1,410.80 on the National Stock Exchange.  End

 

Edited by Ashish Shirke

 

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