ICICI Bank 2009 Annual Report Download - page 59

57Annual Report 2008-2009
The Power of Belief
We do not distinguish between provisions and technical write-offs while assessing the adequacy of our loan loss
coverage, as both provisions and write-offs represent a reduction of the principal amount of a non-performing
asset. In compliance with regulations governing the presentation of financial information by banks, we report
non-performing assets net of cumulative write-offs in our financial statements.
RBI has separate guidelines for restructured loans. A fully secured standard asset can be restructured by
re-schedulement of principal repayments and/or the interest element, but must be separately disclosed as
a restructured asset. The diminution in the fair value of the loan, if any, measured in present value terms, is
either written off or provision is made to the extent of the diminution involved. Similar guidelines apply to sub-
standard loans. The sub-standard or doubtful accounts which have been subjected to restructuring, whether
in respect of principal installment or interest amount are eligible to be upgraded to the standard category only
after the specified period, i.e., a period of one year after the date when first payment of interest or of principal,
whichever is earlier, falls due, subject to satisfactory performance during the period. From December 2008, RBI
has permitted banks to restructure loans classified as real estate exposures, up to June 30, 2009. Similarly, banks
have also been permitted to undertake, for accounts that were previously restructured, a second restructuring
without downgrading the account to the non-performing category, up to June 30, 2009. RBI also permitted banks
to restructure as standard accounts all eligible accounts which meet the basic criteria for restructuring, and
which were classified as standard at September 1, 2008 irrespective of their subsequent asset classification.
This is subject to banks receiving an application from the borrower for restructuring the advance on or before
year-end fiscal 2009 and implementing the restructuring the package within 120 days from the date of receipt of the
application. During fiscal 2009 we restructured loans aggregating Rs. 11.15 billion extended to 996 borrowers which
included 962 retail mortgage borrowers. In fiscal 2008, we had restructured loans aggregating Rs. 16.76 billion.
At year-end fiscal 2009, we had received proposals for restructuring of loans aggregating Rs. 20.03 billion from
41 borrowers, which were under process.
The following table sets forth, at year-end fiscal 2008 and year-end fiscal 2009, information regarding the
classification of our gross assets (net of write-offs, interest suspense and derivatives income reversal).
Rs. in billion
March 31, 2008 March 31, 2009
Standard assets Rs. 2,352.22 Rs. 2,316.10
of which: Restructured loans148.41 61.27
Non-performing assets 75.88 98.03
Of which: Sub-standard 48.49 61.67
Doubtful assets 22.09 31.04
Loss assets 5.30 5.32
Total customer assets2Rs. 2,428.10 Rs. 2,414.13
1. Reflects the cumulative position of restructured loans (excluding applications received for restructruing).
2. Customer assets include advances, lease receivables and credit substitutes like debenture and bonds but excludes preference
shares.
3. All amounts have been rounded off to the nearest Rs. 10.0 million.
The following table sets forth, at the dates indicated, information regarding our non-performing assets, or
NPAs.
Rs. in billion, except percentages
Year ended Gross NPA1Net NPA Net customer
assets % of Net NPA to Net customer assets2
March 31, 2007 41.68 20.19 2,053.74 0.98%
March 31, 2008 75.88 35.64 2,384.84 1.49%
March 31, 2009 98.03 46.19 2,358.24 1.96%
1. Net of write-offs, interest suspense and derivative income reversal.
2. Customer assets include advances and credit substitutes like debentures and bonds but excludes preference shares.
3. All amounts have been rounded off to the nearest Rs. 10.0 million.