ICICI Bank 2010 Annual Report Download - page 33

31Annual Report 2009-2010
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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 55.7
million shares at April 24, 2010).
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 to 2008 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 granted in April 2009 vest in a graded manner over a five year period with 20%, 20%, 30% and 30% of
grant vesting each year commencing from the end of 24 months from the date of grant.
On the basis of the recommendation of the Board Governance, Remuneration & Nomination Committee, the
Board at its Meeting held on April 24, 2010 approved a grant of approximately 2.49 million options for fiscal
2010 to eligible employees 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. 977.70, which was the closing price on the stock
exchange, which recorded the highest trading volume in ICICI Bank shares on April 23, 2010. These options
would vest over a four year period, with 20%, 20%, 30% and 30% respectively of the grant vesting each year
commencing from the end of 12 months from the date of the 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 preceding the date of grant
of options. The above pricing is in line with the SEBI guidelines, as amended from time to time.
Particulars of options granted by ICICI Bank upto April 24, 2010 are given below:
Options granted155,201,055
Options vested 36,661,828
Options exercised 25,920,074
Number of shares allotted pursuant to exercise of options 25,920,074
Options forfeited/lapsed 8,127,506
Extinguishment or modification of options Nil
Amount realised by exercise of options (Rs.) 5,288,748,500
Total number of options in force 21,153,475
1. Includes options granted to wholetime Directors pending RBI approval.
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.
The diluted earnings per share (EPS) pursuant to issue of shares on exercise of options calculated in accordance
with AS-20 was Rs. 35.99 in fiscal 2010 against basic EPS of Rs. 36.14. Since the exercise price of ICICI Bank’s
options is the last closing price on the stock exchange, which recorded the highest trading volume preceding
the date of grant of options, there is no compensation cost in fiscal 2010 based on the intrinsic value of options.
However, if ICICI Bank had used the fair value of options based on the Black-Scholes model, compensation
cost in fiscal 2010 would have been higher by Rs. 901.2 million and proforma profit after tax would have been
Rs. 39.35 billion. On a proforma basis, the Bank’s basic and diluted earnings per share would have been Rs. 35.33