ICICI Bank 2006 Annual Report Download - page 27

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COMPLIANCE CERTIFICATE OF THE AUDITORS
ICICI Bank has annexed to this report, a certificate obtained from the statutory auditors, S.R. Batliboi &
Company, Chartered Accountants, regarding compliance of conditions of corporate governance as
stipulated in Clause 49 of the listing agreement.
EMPLOYEE STOCK OPTION SCHEME
In fiscal 2000, ICICI Bank instituted an Employee Stock Option Scheme (ESOS) to enable the employees
and Directors of ICICI Bank and its subsidiaries to participate in the future growth and financial success of
the Bank. As per the ESOS as amended from time to time, the maximum number of options granted to
any employee/director in a year is limited to 0.05% of ICICI Bank’s issued equity shares at the time of the
grant, and the aggregate of all such options is limited to 5% of ICICI Bank’s issued equity shares on the
date of the grant (equivalent to 44,494,852 shares at April 29, 2006).
Options granted for fiscal 2003 and earlier years vest in a graded manner over a three-year period, with
20%, 30% and 50% of the grants vesting in each year, commencing not earlier than 12 months from the
date of grant. Options granted for fiscal 2004 and beyond vest in a graded manner over a four-year
period, with 20%, 20%, 30% and 30% of the grants vesting in each year, commencing not earlier than 12
months from the date of grant.
Options can be exercised within 10 years from the date of grant or five years from the date of vesting,
whichever is later. The price of the options granted prior to June 30, 2003 is the closing market price on
the stock exchange, which recorded the highest trading volume on the date of grant. The price for options
granted on or after June 30, 2003 till July 21, 2004 is equal to the average of the high and low market price
of the equity shares in the two week period preceding the date of grant of the options, on the stock
exchange which recorded the highest trading volume during the two week period. The price for options
granted on or after July 22, 2004 is equal to the closing price on the stock exchange which recorded the
highest trading volume preceeding the date of grant of options. The above pricing is in line with the SEBI
guidelines, as amended from time to time.
On the basis of the recommendation of the Board Governance & Remuneration Committee, the Board at
its Meeting held on April 29, 2006 approved a grant of approximately 6.3 million options for fiscal 2006 to
eligible employees (including employees of subsidiaries and wholetime Directors). Each option confers
on the employee a right to apply for one equity share of face value of Rs. 10 of ICICI Bank at Rs. 576.80,
which was the last closing price on the stock exchange which recorded the highest trading volume in
ICICI Bank shares on April 28, 2006.
Particulars of options granted by ICICI Bank upto April 29, 2006 are given below:
Options granted 40,206,155
Options vested 20,159,561
Options exercised 12,824,604
Number of shares allotted pursuant to exercise of options 12,824,604
Options forfeited/lapsed 3,870,015
Extinguishment or modification of options —
Amount realised by exercise of options (Rs.) 1,952,644,811
Total number of options in force 23,511,536
Options granted by ICICI Bank to senior managerial personnel for fiscal 2006 are as follows: K. V. Kamath
–250,000, Lalita D. Gupte –165,000, Kalpana Morparia –165,000, Chanda D. Kochhar –125,000, Nachiket
Mor – 125,000, Bhargav Dasgupta – 75,000, Sanjiv Kerkar – 25,000, Vishakha Mulye – 75,000, Ramni
Nirula – 40,000, Nagesh Pinge – 40,000, Madhabi Puri-Buch – 75,000, K. Ramkumar – 75,000, V.
Vaidyanathan – 75,000, and Pravir Vohra – 40,000. No employee/director has a grant, in any one year, of
options amounting to 5% or more of total options granted during that year. No employee was granted
options during any one year equal to or exceeding 0.05% of the issued equity shares of ICICI Bank at the
time of the grant.
Directors’ Report