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18th Annual Report and Accounts 2011- 2012
Next Generation Banking...
Pioneering

Table of contents

  • Page 1
    18th Annual Report and Accounts 2011- 2012 Pioneering Next Generation Banking...

  • Page 2
    ... in adopting the latest technologies, we are constantly developing next gen products and applications. This enables us to match our customers' evolving behaviour by delivering convenience, thereby generating a whole new banking experience. This year, we showcase four such developments that are tools...

  • Page 3
    ...-6617260 Fax : +91-265-6617341 CORPORATE OFFICE ICICI Bank Towers Bandra-Kurla Complex Mumbai 400 051 Tel : +91-22-26531414 Fax : +91-22-26531122 FINANCIALS Auditors' Report ...Balance Sheet ...Profit and Loss Account ...Cash Flow Statement ...Schedules...Statement pursuant to Section 212 of the...

  • Page 4
    ... As I write this annual message, there seems to be a sense of pessimism around the Indian economy. There are concerns about slowdown in investment, about inflation and oil prices and about corporate performance. Equity and currency markets are exhibiting high volatility, which is further impacting...

  • Page 5
    ... at the ICICI Group. Over the last year, the executive team has balanced the objectives of growth, profitability and risk management in a commendable manner, further strengthening the balance sheet and the key drivers of profitability. This strategy has been executed across all businesses, while...

  • Page 6
    ... of the balance sheet in our domestic and overseas businesses. • We have reduced our net non-performing asset ratio from 2.19% at the peak to 0.62% at March 31, 2012. The improvement in asset quality is also evident in the reduction in the provision charge in our profit & loss account, which has...

  • Page 7
    .... A key strength of the ICICI Group franchise is its leadership position across various segments of financial services in India. We continue to strengthen this franchise. Our insurance and mutual fund businesses are focused on enhancing their market positioning and profitability. Our private equity...

  • Page 8
    ...Chanda Kochhar Rajiv Sabharwal Information Technology Strategy Committee Homi Khusrokhan, Chairman K. V. Kamath Sridar Iyengar Chanda Kochhar Risk Committee K. V. Kamath, Chairman Sridar Iyengar Arvind Kumar V. Sridar Chanda Kochhar Share Transfer & Shareholders'/ Investors' Grievance Committee Homi...

  • Page 9
    ... for taxes of ` 23.38 billion and all expenses. The disposable profit is ` 114.83 billion, taking into account the balance of ` 50.18 billion brought forward from the previous year. Your Directors have recommended a dividend at the rate of ` 16.50 per equity share of face value ` 10 for the year and...

  • Page 10
    ... never before. ICICI Bank is the first and only bank in India to have introduced a powerful new 'Bank App' on its official Facebook page. Hosted on secure ICICI Bank servers, the app allows customers to access their bank accounts without having to leave Facebook. They can complete tasks like viewing...

  • Page 11
    ... financial profile. We will leverage these strengths for growth, while continuing our focus on profitability and risk management to achieve sustainable value creation." ICICI Securities Primary ICICI International Limited Dealership Limited ICICI Venture Funds Management Company Limited ICICI Home...

  • Page 12
    ... key financials of the Bank's subsidiaries is also included in this Annual Report. DIRECTORS RBI, vide its letter dated January 3, 2012, approved the reappointment of K. Ramkumar as an Executive Director of the Bank for a further period of two years, i.e. from February 1, 2012 till January 31, 2014...

  • Page 13
    ... way customers are served at a branch. These next gen kiosks will enable service requests in addition to giving customers access to all the ICICI Group websites. This will help reduce their waiting time at branches, thereby offering them an efficient banking experience. Annual Report 2011-2012 11

  • Page 14
    ... ways to manage wealth. Customers can, not only conduct regular banking transactions and monitor their expenses and portfolios on a realtime basis, but also carry out investments in mutual funds. They can receive audio and video podcasts on investment products and market developments, view their...

  • Page 15
    ... were employees of the Bank, on the boards of 25 assisted companies. The Bank has a Nominee Director Cell for maintaining records of nominee directorships. "We will continue to grow our customer base by focusing on providing superior customer experience. The increase in branch and ATM touch points...

  • Page 16
    ...and reviewing asset-liability position of the Bank. A summary of reviews conducted by these Committees are reported to the Board on a regular basis. Policies approved from time to time by the Board of Directors/Committees of the Board form the governing framework for each type of risk. The business...

  • Page 17
    ... complex treasury products. It is therefore vital for them to have their fingers on the pulse of the financial markets at all times. With ICICI Bank's Treasury 360 being launched shortly, corporate treasury managers can now confidently manage their portfolios, view deal level details and underlying...

  • Page 18
    ... Social Responsibility Committee, Credit Committee, Customer Service Committee, Fraud Monitoring Committee, Information Technology Strategy Committee, Risk Committee, Share Transfer & Shareholders'/Investors' Grievance Committee and Committee of Executive Directors. These Board Committees other than...

  • Page 19
    ... companies incorporated in India. Comprises private limited companies incorporated in India and foreign companies but excludes Section 25 companies and foreign companies not for profit. Comprises only Audit Committee and Share Transfer & Shareholders'/Investors' Grievance Committee of Indian public...

  • Page 20
    Directors' Report In terms of Clause 49 of the listing agreement, the number of Committees (Audit Committee and Share Transfer & Shareholders'/Investors' Grievance Committee) of public limited companies in which a Director is a member/chairman were within the limits provided under Clause 49 for all...

  • Page 21
    ... Directors, approval of the policy for and quantum of bonus payable to the members of the staff, framing of guidelines for the Employees Stock Option Scheme and recommendation of grant of ICICI Bank stock options to the employees and wholetime Directors of ICICI Bank and its subsidiary companies...

  • Page 22
    ... at the current AGM. In line with the staff loan policy applicable to specified grades of employees who fulfill prescribed eligibility criteria to avail loans for purchase of residential property, the wholetime Directors are also eligible for housing loans subject to approvals of RBI. As provided...

  • Page 23
    ... video-conference. Number of meetings attended 2/2 0/1 0/1 1/2 2/2 V. Credit Committee Terms of Reference The functions of the Committee include review of developments in key industrial sectors and approval of credit proposals as per authorisation approved by the Board. Annual Report 2011-2012 21

  • Page 24
    ..., if any, report to top management of the Bank and RBI, monitor progress of investigation, and recovery position, ensure that staff accountability is examined at all levels in all the cases of frauds and action, if required, is completed quickly without loss of time and review of efficacy of...

  • Page 25
    ... (credit, market, liquidity, operational and reputation risks), investment policies and strategy and regulatory and compliance issues in relation thereto. The Committee is also empowered to review risk return profile of the Bank, capital adequacy based on risk profile of the Bank's balance sheet...

  • Page 26
    ... options, review and redressal of shareholders' and investors' complaints, delegation of authority for opening and operation of bank accounts for payment of interest, dividend and redemption of securities and the listing of securities on stock exchanges. Composition The Share Transfer & Shareholders...

  • Page 27
    ... like asset liability management, approval of credit proposals, approval of products and processes and management of operational risk, under authorisation/supervision of the Board and its Committees. XIII. General Body Meetings The details of General Body Meetings held in the last three years are...

  • Page 28
    ...). The financial results, official news releases, analyst call transcripts and presentations are also available on the Bank's website. The Management's Discussion & Analysis forms part of the Annual Report. General Shareholder Information General Body Meeting Eighteenth AGM Day, Date & Time Monday...

  • Page 29
    ...051 New York Stock Exchange (ADSs)2 11, Wall Street, New York, NY 10005, United States of America 1. 2. FII segment of BSE. Each ADS of ICICI Bank represents two underlying equity shares. Code for ICICI Bank 532174 & 6321741 ICICIBANK IBN ICICI Bank has paid annual listing fees on its capital for...

  • Page 30
    ... to an Issue & Share Transfer (R&T) Agent. 3i Infotech is a global information technology company providing technology solutions and in addition to R&T services provides software products, managed IT Services, application software development & maintenance, payment solutions, business intelligence...

  • Page 31
    ... the total issued/paid up equity share capital of ICICI Bank. Certificates issued in this regard are placed before the Share Transfer & Shareholders'/ Investors' Grievance Committee and forwarded to BSE and NSE, where the equity shares of ICICI Bank are listed. Physical Share Disposal Scheme With...

  • Page 32
    ... Global Indian Equity Fund Mauritius Limited Carmignac Gestion A/c Carmignac Patrimoine Bajaj Allianz Life Insurance Company Limited SBI Life Insurance Company Limited New Perspective Fund Inc. Bajaj Holdings and Investment Limited Total Distribution of shareholding of ICICI Bank at March 31, 2012...

  • Page 33
    ...% of ICICI Bank's total equity capital at March 31, 2012. Currently, there are no convertible debentures outstanding. Plant Locations - Not applicable Address for Correspondence Sandeep Batra Group Compliance Officer & Company Secretary or Ranganath Athreya General Manager & Joint Company Secretary...

  • Page 34
    ...fiscal 2012 to eligible employees and wholetime Directors (options granted to wholetime Directors being subject to RBI approval). Each option confers on the employee a right to apply for one equity share of face value of ` 10 of ICICI Bank at ` 841.45 which was closing price on the stock exchange 32

  • Page 35
    ... ) 1. Includes Options granted to wholetime Directors pending RBI approval 57,094,191 9,579,664 29,587,346 27,506,845 44,627,833 29,587,346 Nil 7,185,295,195 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...

  • Page 36
    ... ICICI Bank is grateful to the Government of India, RBI, SEBI, IRDA and overseas regulators for their continued co-operation, support and guidance. ICICI Bank wishes to thank its investors, the domestic and international banking community, rating agencies and stock exchanges for their support. ICICI...

  • Page 37
    ... on Corporate Governance To the Members of ICICI Bank Limited We have examined the compliance of conditions of corporate governance by ICICI Bank Limited ("the Bank") for the year ended on 31 March 2012, as stipulated in Clause 49 of the Listing Agreement of the said Bank with stock exchanges. The...

  • Page 38
    ...by adding 223 branches and 2,902 ATMs, taking the total number of branches and ATMs to 2,752 and 9,006 respectively. The Bank has the largest branch network among private sector banks in the country. We continued our initiatives to offer customised products and services for various customer segments...

  • Page 39
    ... ATMs now serve as "Almost a Bank Branch". During the year, we added a number of features to our ATMs, such as instant fund transfer, fixed deposits, bill payment, mobile number updation and insurance premium payments for the convenience of our customers. ICICI Bank was awarded the "NFS Operational...

  • Page 40
    Business Overview Wholesale Banking ICICI Bank's wholesale banking strategy is based on providing comprehensive and customised financial solutions to our corporate customers. The Wholesale Banking Group manages relationships with major corporate houses, mid-market companies and government entities ...

  • Page 41
    ... Indians in key global markets. Further, during 2012, India continued to emerge as a top target market for most major global corporations. ICICI Bank's International Banking Group supports such plans by establishing relationships with major global corporations. We also seek to build stable funding...

  • Page 42
    ... initiative in the country. Treasury Our treasury operations are structured into three verticals: proprietary trading group, customer related markets business and the asset-liability management group. Fiscal 2012 was a volatile year for financial markets. The government bond markets saw an increase...

  • Page 43
    ...duration given the volatile interest rate environment. RISK MANAGEMENT Risk is an integral part of the banking business and we aim at delivering superior shareholder value by achieving an appropriate trade-off between risk and returns. Key risks include credit, market, liquidity, operational, legal...

  • Page 44
    ... the type of products that can be offered, customer categories, targeted customer profile and the credit approval process and limits. The credit and recovery policy is approved by our Board of Directors. In order to assess the credit risk associated with any corporate financing proposal, we assess...

  • Page 45
    ... trading book are monitored on a daily basis by the Treasury Middle Office Group and reviewed periodically. Foreign exchange risk is monitored through the net overnight open foreign exchange limit. Interest rate risk of the overall balance sheet is measured through the use of re-pricing gap analysis...

  • Page 46
    ...risks and controls, new products and process approval framework, measurement through incidents and exposure reporting, monitoring through key risk indicators and mitigation through process and control enhancement and insurance. The Bank has formed an independent Operational Risk Management Group for...

  • Page 47
    ... full year of operations after the regulatory changes in respect of unit linked insurance products came into effect from September 2010. ICICI Life successfully maintained its leadership amongst private players in new business premium on retail weighted basis with a market share of 5.9%. ICICI Life...

  • Page 48
    ... 31, 2012, ICICI Bank UK plc had total assets of US$ 4.1 billion compared to US$ 6.4 billion at March 31, 2011. Its capital position was strong with a capital adequacy ratio of 32.4% at March 31, 2012 compared to 23.1% at March 31, 2011. ICICI Bank Canada ICICI Bank Canada's profit after tax for...

  • Page 49
    ... India and changes in asset valuations. CREDIT RATING ICICI Bank's credit ratings by various credit rating agencies at March 31, 2012 are given below: Agency Moody's Investor Service (Moody's) Standard & Poor's (S&P) Credit Analysis & Research Limited (CARE) Investment Information and Credit Rating...

  • Page 50
    ... US economy increased risks to global growth. The Indian economy saw moderation in economic activity during fiscal 2012, following domestic macroeconomic conditions of high interest rates and slowdown in investments. India's gross domestic product (GDP) grew by 6.9% during the first nine months of...

  • Page 51
    ... in fiscal 2011. Some key regulatory developments in the Indian financial sector during fiscal 2012 include: ‡ In May 2011, RBI increased the interest rate on savings deposits by 50 basis points from 3.5% to 4.0%. Further, in October 2011, interest rates on savings accounts were deregulated with...

  • Page 52
    ...rate on savings and term deposits of maturity of one year and above. RBI issued guidelines on investments in subsidiaries and other companies, including investments in non-financial services companies in December 2011. According to the guidelines, equity investments by a bank in a subsidiary company...

  • Page 53
    ... The objective is to limit the volatility in loan loss provisioning requirements witnessed during an economic cycle. ‡ STANDALONE FINANCIALS AS PER INDIAN GAAP Summary During fiscal 2012, we focused on profitable growth by leveraging our rebalanced funding mix and strong capital position to grow...

  • Page 54
    ... the net profit after tax to the quarterly average equity share capital and reserves. Return on average assets is the ratio of net profit after tax to average assets. The average balances are the averages of daily balances, except averages of foreign branches which are calculated on a monthly basis...

  • Page 55
    ...as a result of incremental disbursements at higher lending rates and reflecting the rising interest rate environment. Further, the yield on advances was also higher on account of increase in ICICI Bank's Base Rate from 8.75% at March 31, 2011 to 10.00% at March 31, 2012. Annual Report 2011-2012 53

  • Page 56
    ... of deposits. RBI increased the rate on savings account deposits to 4.00% on daily average balances with effect from May 3, 2011 resulting in an increase in cost of average savings account deposits in fiscal 2012 compared to fiscal 2011. In its second quarter review of monetary policy 2011-12 issued...

  • Page 57
    ... dividend income from subsidiaries. Fee income Fee income primarily includes fees from corporate clients such as loan processing fees, transaction banking fees and structuring fees and fees from retail customers such as loan processing fees, fees from credit cards business, account service charges...

  • Page 58
    ... of investments on account of changes in unrealised profit/(loss) in the fixed income, equity and preference share portfolio, units of venture funds and security receipts. Loss on treasury-related activities decreased from ` 2.15 billion in fiscal 2011 to ` 0.13 billion in fiscal 2012. Loss from...

  • Page 59
    ...35.15 billion in fiscal 2012. Employee expenses increased primarily due to annual increase in salaries and performance bonus and increase in the employee base, including sales executives, employees on fixed term contracts and interns. The average number of employees increased by around 18% in fiscal...

  • Page 60
    ... banks, including money at call and short notice. Cash and cash equivalents increased from ` 340.90 billion at March 31, 2011 to ` 362.29 billion at March 31, 2012. The increase was primarily due to an increase in term money lending and call money lending by overseas branches. The balances with RBI...

  • Page 61
    ...). ` in billion, except percentages Liabilities Equity share capital Reserves Deposits - Savings account deposits - Current account deposits - Term deposits Borrowings (excluding subordinated debt and preference share capital) - Domestic - Overseas branches Subordinated debt (included in Tier...

  • Page 62
    ..., 2011 to ` 349.73 billion at March 31, 2012. Total deposits at March 31, 2012 formed 64.6% of the funding (i.e. deposits and borrowings, including subordinated debt and excluding preference share capital). The current and savings account deposits increased from ` 1,016.47 billion at March 31, 2011...

  • Page 63
    ... on account of new branches and office premises. Capital resources We actively manage our capital to meet regulatory norms and current and future business needs considering the risks in our businesses, expectations of rating agencies, shareholders and investors and the available options for raising...

  • Page 64
    ... The operational risk capital charge is computed based on 15% of average of previous three financial years' gross income and is revised on an annual basis at June 30. Internal assessment of capital Our capital management framework includes a comprehensive internal capital adequacy assessment process...

  • Page 65
    ... perception of credit rating agencies, shareholders and investors; future strategy with regard to investments or divestments in subsidiaries; and evaluation of options to raise capital from domestic and overseas markets, as permitted by RBI from time to time. We formulate our internal capital level...

  • Page 66
    ....07 17.25 29.24 221.69 ` 2,244.15 Includes home loans, automobile loans, commercial business loans, two wheeler loans, personal loans and credit cards. Also includes dealer funding portfolio and developer financing portfolio. Other industries primarily include automobiles, drugs and pharmaceuticals...

  • Page 67
    ... Indian development banks like the National Bank for Agriculture and Rural Development, the Small Industries Development Bank of India and the National Housing Bank. These deposits have a maturity of up to seven years and carry interest rates lower than market rates. At March 31, 2012, our total...

  • Page 68
    ..., if the account remains overdue for more than 90 days. 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...

  • Page 69
    ... 3. Includes home loans, automobile loans, commercial business loans, two wheeler loans, personal loans and credit cards. Also includes NPAs in dealer funding and developer finance portfolios. Other industries primarily include construction, drugs and pharmaceuticals, construction, agriculture and...

  • Page 70
    ...RBI guidelines for the Bank. Treasury includes the entire investment portfolio of the Bank. Other Banking includes hire purchase and leasing operations and other items not attributable to any particular business segment of the Bank. Framework for transfer pricing All liabilities are transfer priced...

  • Page 71
    ...13.0% in fiscal 2012. Profit after tax of ICICI Prudential Life Insurance Company Limited increased from ` 8.08 billion in fiscal 2011 to ` 13.84 billion in fiscal 2012 due to higher profits from existing policies and lower upfront expenses due to lower new business. Investment income increased from...

  • Page 72
    ... of ICICI Bank Eurasia Limited Liability Company remained at similar levels at ` 0.21 billion in fiscal 2011 and fiscal 2012. Profit after tax of ICICI Securities Primary Dealership Limited increased from ` 0.53 billion in fiscal 2011 to ` 0.86 billion in fiscal 2012 due to increase in trading gains...

  • Page 73
    ... 2006 2007 2008 2009 2010 2011 2012 FY 2163.66 914.05 Deposits Advances ` in billion, except per share data At year-end fiscal 2003 Net interest income Earnings per share (Basic) Earnings per share (Diluted) Total assets Equity capital & reserves Total capital adequacy ratio 14.45 19.68 19.65...

  • Page 74
    ... Team Leader, CRISIL Limited 15-Dec-98 Analyst, Anand Rathi Group 10-Apr-95 Management Trainee, IPCL 22-Jan-10 Head of Micro Finance, Barclays Bank Plc 24-Mar-05 Country Head, Apna Loan (I) Pvt.Limited 23-Apr-93 Project Officer, IFCI Limited 11-Oct-99 Regional Manager,Ceat Financial Services Limited...

  • Page 75
    ... India Limited 15-Mar-99 In Charge -Treasury, Meghraj Financial Services(I) Pvt Limited 5-Apr-99 Head Agency Business,DGP Windsor 1-Jul-08 Director, American Express 1-Feb-05 Manager Supply Chain, Becton Dickinson India Limited 1-May-09 Executive Director, ICICI Prudential Life Insurance Co. Limited...

  • Page 76
    ..., GE Capital Services India 22-May-02 Regional Manager, TransAmerica Apple Distribution Finance Pvt. Limited 1-Jul-99 Manager, IDBI Limited 26-Sep-03 Manager, BNP Paribas 15-Mar-00 CEAT Financial Services Limited 31-Dec-99 Manager HRD,Tata Liebert 13-May-05 Head-Loyalty, Amex Bank 10-Jan-00 Product...

  • Page 77
    ... Limited 3-Nov-03 Deputy Manager, E-Serve International Limited 9-Jun-03 Head of Finance & Risk, AIB Govett (Asia) Limited * Indicates part of the year + Nature of employment contractual , other employees are in the permanent employment of the Bank, governed by its rules and conditions of service...

  • Page 78
    financials

  • Page 79
    ... Banking Regulation Act, 1949, read with Section 211 of the Companies Act, 1956. We did not audit the financial statements of Singapore, Bahrain, Hong Kong, Dubai, Qatar, Sri Lanka and New York-USA branches, whose financial statements reflect total assets of Rs. 1,140,883 million as at 31 March 2012...

  • Page 80
    balance sheet at March 31, 2012 Schedule CAPITAL AND LIABILITIES Capital ...Employees stock options outstanding ...Reserves and surplus ...Deposits ...Borrowings ...Other liabilities and provisions ...TOTAL CAPITAL AND LIABILITIES ...2 3 4 5 1 11,527,683 23,854 592,500,885 2,554,999,561 1,401,649,...

  • Page 81
    ... dividend tax ...Balance carried over to balance sheet ...TOTAL ...Significant accounting policies and notes to accounts Earnings per share (refer note 18.1) Basic (`) ...Diluted (`)...Face value per share (`) ... IV. The schedules referred to above form an integral part of the Profit and Loss...

  • Page 82
    ...) in borrowings ...Increase/(decrease) in deposits ...(Increase)/decrease in other assets ...Increase/(decrease) in other liabilities and provisions ...Refund/(payment) of direct taxes ...Net cash flow from/(used in) operating activities ...Cash flow from investing activities...Investments in...

  • Page 83
    schedules forming part of the Balance Sheet At 31.03.2012 SCHEDULE 1 - CAPITAL Authorised capital 1,275,000,000 equity shares of ` 10 each (March 31, 2011: 1,275,000,000 equity shares of ` 10 each )...15,000,000 shares of ` 100 each (March 31, 2011: 15,000,000 shares of ` 100 each) 1 (` in '000s) ...

  • Page 84
    ... of taxes and transfer to Statutory Reserve. Also includes profit on sale of land and buildings, net of taxes and transfer to Statutory Reserve. Includes appropriations made to Reserve Fund and Investment Fund account in accordance with regulations applicable to Sri Lanka branch. At March 31, 2012...

  • Page 85
    ...Balance Sheet (Contd.) At 31.03.2012 SCHEDULE 3 - DEPOSITS A. Demand deposits i) From banks ...ii) From others...II. Savings bank deposits ...III. Term deposits i) From banks ...ii) From others...TOTAL DEPOSITS ...B. I. Deposits of branches in India ...II. Deposits of branches outside India ...TOTAL...

  • Page 86
    schedules forming part of the Balance Sheet (Contd.) At 31.03.2012 SCHEDULE 5 - OTHER LIABILITIES AND PROVISIONS I. II. III. IV. V. Bills payable ...Inter-office adjustments (net credit) ...Interest accrued ...Sundry creditors ...Provision for standard assets...35,556,356 3,076,441 30,693,392 34,537...

  • Page 87
    schedules forming part of the Balance Sheet (Contd.) At 31.03.2012 SCHEDULE 8 - INVESTMENTS I. Investments in India [net of provisions] i) Government securities ...ii) Other approved securities ...iii) Shares (includes equity and preference shares) ...iv) Debentures and bonds ...v) Subsidiaries and/...

  • Page 88
    ... which are in the process of being transferred in the Bank's name. SCHEDULE 12 - CONTINGENT LIABILITIES I. Claims against the Bank not acknowledged as debts ...II. Liability for partly paid investments ...III. Liability on account of outstanding forward exchange contracts1 ...IV. Guarantees given...

  • Page 89
    schedules forming part of the Profit and Loss Account Year ended 31.03.2012 SCHEDULE 13 - INTEREST EARNED I. Interest/discount on advances/bills ...II. III. IV. Income on investments...Interest on balances with Reserve Bank of India and other inter-bank funds ...Others 1, 2 (` in '000s) Year ended ...

  • Page 90
    ... Schedule of the Banking Regulation Act, 1949. The accounting and reporting policies of ICICI Bank used in the preparation of these financial statements conform to Generally Accepted Accounting Principles in India (Indian GAAP), the guidelines issued by Reserve Bank of India (RBI) from time to time...

  • Page 91
    ... by RBI from time to time. Accordingly, in cases where the cash flows from security receipts issued by the asset reconstruction companies are limited to the actual realisation of the financial assets assigned to the instruments in the concerned scheme, the Bank reckons the net asset value obtained...

  • Page 92
    ... at quarterly average closing rates. Monetary foreign currency assets and liabilities of domestic and integral foreign operations are translated at closing exchange rates notified by Foreign Exchange Dealers' Association of India (FEDAI) at the balance sheet date and the resulting profits/losses are...

  • Page 93
    ... 90 days and mark-to-market gains on other derivative contracts with the same counter-parties are reversed through profit and loss account. Employee Stock Option Scheme (ESOS) The Employees Stock Option Scheme (the Scheme) provides for grant of equity shares of the Bank to wholetime directors and...

  • Page 94
    schedules forming part of the Accounts (Contd.) purchases annuities from LIC and ICICI Prudential Life Insurance Company Limited as part of master policies for payment of pension to retired employees of erstwhile Bank of Madura, erstwhile Sangli Bank and erstwhile Bank of Rajasthan. Actuarial ...

  • Page 95
    ...Return on assets2...Profit per employee3 (` in million) ...Business (average deposits plus average advances) per employee3, 4 (` in million) ... 7.79% 1.74% 2.41% 1.50% 1.1 70.8 For the purpose of computing the ratio, working funds represent the average of total assets as reported in Form X to RBI...

  • Page 96
    ....0 million, wherein the funds were received in March 2010 but were not considered for Tier II capital pending allotment. 4. Information about business and geographical segments Business Segments Pursuant to the guidelines issued by RBI on Accounting Standard 17 - (Segment Reporting) - Enhancement of...

  • Page 97
    ...tax asset (net). Includes share capital and reserves and surplus. Geographical segments The Bank reports its operations under the following geographical segments. x Domestic operations comprise branches in India x Foreign operations comprise branches outside India and offshore banking unit in India...

  • Page 98
    ... have been made by the management. Assets and liabilities in foreign currency exclude off-balance sheet assets and liabilities. The following table sets forth, the maturity pattern of assets and liabilities of the Bank at March 31, 2012. Loans & Investment Advances 2 securities2 7,738.5 13,041...

  • Page 99
    ... per the original issue terms. Employee Stock Option Scheme (ESOS) In terms of the ESOS, as amended, the maximum number of options granted to any eligible employee in a financial year shall not exceed 0.05% of the issued equity shares of the Bank at the time of grant of the options and aggregate of...

  • Page 100
    ... details of these bonds. ` in million Particulars Lower Tier II ...Total ...Date of Issue Coupon Rate (%) Tenure 6 years Amount 16,000.0 16,000.0 March 16, 2012 9.20% (semi-annually) 9. During the year ended March 31, 2011, the Bank raised subordinated debt qualifying for Tier II capital amounting...

  • Page 101
    ...Amounts reported are based on face value of securities under repo and reverse repo. The transactions with RBI under LAF are accounted for as borrowing and lending transactions from the three months ended March 31, 2012. If the Bank had continued to account for LAF transactions as "sale and purchase...

  • Page 102
    ... million in subordinated bonds of subsidiaries, namely ICICI Bank UK PLC and ICICI Bank Canada. Excludes equity shares, units of equity-oriented mutual fund, units of venture capital fund, pass through certificates, security receipts, commercial papers, certificates of deposit, unlisted convertible...

  • Page 103
    ... one time transfer of securities to/from HTM category with the approval of Board of Directors permitted to be undertaken by banks at the beginning of the accounting year and sale to RBI under pre-announced Open Market Operation auctions) have not exceeded 5% of the book value of the investments held...

  • Page 104
    schedules forming part of the Accounts (Contd.) The following table sets forth the details of derivative positions at March 31, 2012. Sr. No. 1 Particulars Derivatives (Notional principal amount) a) For hedging ...b) For trading ...Marked to market positions3 a) Asset (+) ...b) Liability (-) ......

  • Page 105
    ..., counter-parties and FIMMDA. The Bank offers deposits to customers of its offshore branches with structured returns linked to interest, forex, credit or equity benchmarks. The Bank covers these exposures in the inter-bank market. At March 31, 2012, the net open position on this portfolio was Nil...

  • Page 106
    ... contracts for balance sheet management and market making purposes whereby the Bank offers derivative products to its customers to enable them to hedge their interest rate risk within the prevalent regulatory guidelines. A FRA is a financial contract between two parties to exchange interest payments...

  • Page 107
    ...Ratio The provision coverage ratio of the Bank at March 31, 2012 computed as per the extant RBI guidelines is 80.4% (March 31, 2011: 76.0%). 21. Farm loan waiver The Ministry of Finance, Government of India had issued guidelines for the implementation of the Agriculture Debt Waiver and Relief Scheme...

  • Page 108
    ...167.1) Closing balance ...1,786.7 2,363.8 23. Financial assets transferred during the year to securitisation company (SC)/reconstruction company (RC) The Bank has transferred certain assets to Asset Reconstruction Companies (ARCs) in terms of the guidelines issued by RBI governing such transfer. For...

  • Page 109
    schedules forming part of the Accounts (Contd.) 24. Details of non-performing assets purchased/sold, excluding those sold to SC/RC The Bank has not purchased any non-performing assets in terms of the guidelines issued by the RBI circular no. DBOD. No.BP .BC.16/21.04.048/2005-06 dated July 13, 2005. ...

  • Page 110
    ...4.47% 1.11% Represents loans towards agriculture and allied activities that qualify for priority sector lending. Excludes retail loans towards agriculture and allied activities that qualify for priority sector lending. Excludes commercial business loans, developer financing and dealer funding. F32

  • Page 111
    ... Represents the total assets and total revenue of foreign operations as reported in Schedule 18 notes to accounts note no. 4 on information about business and geographical segments, of the financial statements. As per RBI guidelines. (V) Off-balance sheet special purpose vehicles (SPVs) sponsored...

  • Page 112
    ... Bank in respect of primary issue of shares or convertible bonds or convertible debentures or units of equity oriented mutual funds...Financing to stockbrokers for margin trading ...All exposures to Venture Capital Funds (both registered and unregistered) Others ...Total Exposure to Capital Market...

  • Page 113
    ... and building developers for construction, corporate loans for development of special economic zone, loans to borrowers where servicing of loans is from a real estate activity and exposures to mutual funds/venture capital funds/private equity funds investing primarily in the real estate companies...

  • Page 114
    schedules forming part of the Accounts (Contd.) 30. Details of Single Borrower Limit and Borrower Group Limit exceeded by the Bank During the year ended March 31, 2012, the Bank has complied with the Reserve Bank of India guidelines on single borrower and borrower group limit. 31. Unsecured advances...

  • Page 115
    ... Liability on account of outstanding forward exchange contracts Brief Description This item represents certain demands made in certain tax and legal matters against the Bank in the normal course of business and customer claims arising in fraud cases. In accordance with the Bank's accounting policy...

  • Page 116
    ... (gain)/loss ...Effect of the limit in para 59(b)...Net cost ...Actual Return on Plan Assets...Expected employer's contribution next year ...Investment details of plan assets Insurer Managed Funds1 ...Government of India securities...Corporate Bonds ...Others ...Assumptions Interest rate ...Salary...

  • Page 117
    ... (gain)/loss ...Past service cost ...Exchange fluctuation loss/(gain)...Losses/(Gains) on "Acquisition/Divestiture" ...Effect of the limit in para 59(b) ...Net cost ...Actual Return on Plan Assets...Expected employer's contribution next year ...Investment details of plan assets Insurer Managed...

  • Page 118
    schedules forming part of the Accounts (Contd.) Particulars Special Deposit schemes ...Others ...Assumptions Interest rate ...Salary escalation rate ...Estimated rate of return on plan assets ...1. Year ended March 31, 2012 5.78% 0.85% 8.30% 7.00% 8.00% Year ended March 31, 2011 7.12% 1.20% 8.10% ...

  • Page 119
    ...Bank Canada, ICICI Bank Eurasia Limited Liability Company, ICICI Prudential Life Insurance Company Limited1, ICICI Lombard General Insurance Company Limited1, ICICI Prudential Asset Management Company Limited1, ICICI Securities Limited, ICICI Securities Primary Dealership Limited, ICICI Home Finance...

  • Page 120
    ...2010), Financial Inclusion Network & Operations Limited, TCW/ICICI Investment Partners Limited, I-Process Services (India) Private Limited, I-Solutions Providers (India) Private Limited3 (upto September 30, 2011), NIIT Institute of Finance, Banking and Insurance Training Limited, ICICI Venture Value...

  • Page 121
    ... transactions for the year ended March 31, 2012 were with ICICI Investment Management Company Limited amounting to ` 28.2 million (March 31, 2011: ` 19.5 million), ICICI Securities Limited amounting to ` 11.4 million (March 31, 2011: ` 12.1 million), I-Process Services (India) Private Limited...

  • Page 122
    ..., 2011: ` 664.4 million), I-Process Services (India) Private Limited amounting to ` 606.5 million (March 31, 2011: ` 392.9 million), ICICI Home Finance Company Limited amounting to ` 349.8 million (March 31, 2011: ` 408.3 million), Financial Inclusion Network & Operations Limited amounting to ` 259...

  • Page 123
    ... of its banking subsidiaries, ICICI Bank UK PLC and ICICI Bank Canada. The details of the letters are given below. On behalf of ICICI Bank UK PLC ICICI Bank Canada To Financial Services Authority, UK (FSA) Canada Deposit Insurance Corporation (CDIC) Purpose Financially support ICICI Bank UK PLC to...

  • Page 124
    ... ...Deposits of ICICI Bank ...Call/term money lent ...Call/term money borrowed ...Advances ...Investments of ICICI Bank ...Investments of related parties in ICICI Bank ...Receivables1...Payables1 ...Guarantees/letter of credit ...Swaps/forward contracts (notional amount) ...Employee stock options...

  • Page 125
    ... and relatives of key management personnel during the year ended March 31, 2012. ` in million Total Items/ Related party Deposits with ICICI Bank ...Deposits of ICICI Bank ...Call/term money lent ...Call/term money borrowed ...Advances ...Investments of ICICI Bank ...Investments of related parties...

  • Page 126
    schedules forming part of the Accounts (Contd.) ` in million Items/Related party Deposits with ICICI Bank ...Deposits of ICICI Bank ...Call/term money lent ...Call/term money borrowed ...Advances ...Investments of ICICI Bank ...Investments of related parties in ICICI Bank1...Receivables ...Payables ...

  • Page 127
    ...been re-grouped to conform to the current year presentation. Signatures to Schedules 1 to 18 For and on behalf of the Board of Directors FOR S.R. BATLIBOI & Co. Firm's Registration no.: 301003E Chartered Accountants K. V. KAMATH Chairman SRIDAR IYENGAR Director CHANDA KOCHHAR Managing Director & CEO...

  • Page 128
    ... Primary Dealership Limited ICICI Securities Limited ICICI Securities Holdings Inc.3 ICICI Securities Inc.3 ICICI Venture Funds Management Company Limited ICICI International Limited4 ICICI Home Finance Company Limited ICICI Trusteeship Services Limited ICICI Investment Management Company Limited...

  • Page 129
    Consolidated financial statements of ICICI Bank Limited and its subsidiaries

  • Page 130
    ... balance sheet of ICICI Bank Limited (the 'Bank') and its subsidiaries, associates and joint ventures (the 'ICICI Group'), as at March 31, 2012, and also the consolidated profit and loss account and the consolidated cash flow statement for the year ended on that date annexed thereto. These financial...

  • Page 131
    ... balance sheet, of the state of affairs of the ICICI Group as at March 31, 2012; (b) in the case of the consolidated profit and loss account, of the profit for the year ended on that date; and (c) in the case of the consolidated cash flow statement, of the cash flows for the year ended on that date...

  • Page 132
    consolidated balance sheet at March 31, 2012 Schedule CAPITAL AND LIABILITIES Capital ...Employees stock options outstanding ...Reserves and surplus ...Minority interest ...Deposits ...Borrowings ...Liabilities on policies in force ...Other liabilities and provisions ...TOTAL CAPITAL AND LIABILITIES...

  • Page 133
    ... ...Transfer to Reserve Fund ...Transfer to Capital Reserve ...Transfer to/(from) Investment Reserve Account ...Transfer to Special Reserve ...Transfer to Revenue and other reserves ...Dividend (including corporate dividend tax) for the previous year paid during the year ...Proposed equity share...

  • Page 134
    ...) in borrowings ...Increase/(decrease) in deposits ...(Increase)/decrease in other assets ...Increase/(decrease) in other liabilities and provisions ...Refund/(payment) of direct taxes ...Net cash flow from/(used in) operating activities ...Cash flow from investing activities ...Purchase of fixed...

  • Page 135
    schedules forming part of the Consolidated Balance Sheet At 31.03.2012 SCHEDULE 1 - CAPITAL Authorised capital 1,275,000,000 equity shares of ` 10 each (March 31, 2011: 1,275,000,000 equity shares of ` 10 each) ...15,000,000 shares of ` 100 each (March 31, 2011: 15,000,000 shares of ` 100 each)1 ......

  • Page 136
    ... schedule-18. 10. At March 31, 2012 includes ` 50.4 million (March 31, 2011:Nil) transferred to General reserve in terms of RBI circular no. DBOD.No.BP .BC. 26/21.04.048/2008-09 dated July 30, 2008, on Agricultural Debt Waiver and Debt Relief Scheme, 2008. 11. Includes unrealised profit/(loss), net...

  • Page 137
    ... in India ...II. Deposits of branches/subsidiaries outside India ...TOTAL DEPOSITS ...SCHEDULE 4 - BORROWINGS I. Borrowings in India Reserve Bank of India ...Other banks ...Other institutions and agencies a) Government of India ...b) Financial institutions/others ...iv) Borrowings in the form of...

  • Page 138
    schedules forming part of the Consolidated Balance Sheet (Contd.) At 31.03.2012 SCHEDULE 5 - OTHER LIABILITIES AND PROVISIONS I. II. III. IV. V. VI. Bills payable ...Inter-office adjustments (net credit) ...Interest accrued ...Sundry creditors ...Provision for standard assets ...Others1 ...37,974,...

  • Page 139
    ... Balance Sheet (Contd.) At 31.03.2012 SCHEDULE 8 - INVESTMENTS I. Investments in India (net of provisions) i) Government securities ...ii) Other approved securities ...iii) Shares (includes equity and preference shares)1 ...iv) Debentures and bonds ...v) Assets held to cover linked liabilities...

  • Page 140
    ...). SCHEDULE 12 - CONTINGENT LIABILITIES I. Claims against the Group not acknowledged as debts ...II. Liability for partly paid investments ...III. Liability on account of outstanding forward exchange contracts1 ...IV. Guarantees given on behalf of constituents ...a) In India ...b) Outside India...

  • Page 141
    ...II. Profit/(Loss) on sale of investments (net) ...III. Profit/(Loss) on revaluation of investments (net) ...IV. Profit/(Loss) on sale of land, buildings and other assets (net)1 ...V. Profit/(Loss) on exchange transactions (net) ...VI. Premium and other operating income from insurance business ...VII...

  • Page 142
    ...ICICI Bank Eurasia Limited Liability Company ICICI Securities Limited ICICI Securities Holdings Inc. ICICI Securities Inc. ICICI Securities Primary Dealership Limited ICICI Venture Funds Management Company Limited ICICI Home Finance Company Limited ICICI Trusteeship Services Limited ICICI Investment...

  • Page 143
    ...General Insurance Company Limited1 ICICI Prudential Asset Management Company Limited1 ICICI Prudential Trust Limited1 TCW/ICICI Investment Partners Limited2 Rainbow Fund3 Financial Inclusion Network & Operations Limited3 I-Process Services (India) Private Limited3,5 NIIT Institute of Finance Banking...

  • Page 144
    ... gains or losses accounted for as foreign currency translation reserve. Monetary foreign currency assets and liabilities of domestic and integral foreign operations are translated at closing exchange rates notified by Foreign Exchange Dealers' Association of India (FEDAI) at the balance sheet date...

  • Page 145
    ... ICICI Bank Limited x ICICI Prudential Life Insurance Company Limited x ICICI Lombard General Insurance Company Limited x ICICI Venture Funds Management Company Limited The Employees Stock Option Scheme (the Scheme) provides for grant of equity shares of the Bank to wholetime directors and employees...

  • Page 146
    ...for one year renewable group term insurance. The unit liability in respect of linked business has been taken as the value of the units standing to the credit of policyholders, using the Net Asset Value (NAV) prevailing at the valuation date. The adequacy of charges under unit linked policies to meet...

  • Page 147
    ... Rajasthan employees in service, separate pension funds are managed by the trust and the liability is funded as per actuarial valuation. The Bank purchases annuities from LIC and ICICI Prudential Life Insurance Company Limited as part of master policies for payment of pension to retired employees of...

  • Page 148
    ... financial statements. The Group does not account for or disclose contingent assets, if any. Cash and cash equivalents Cash and cash equivalents include cash in hand, balances with RBI, balances with other banks and money at call and short notice. Investments i) Investments of the Bank are accounted...

  • Page 149
    ... quoted closing price on the Bombay Stock Exchange (BSE) is used]. c. Mutual fund units at the balance sheet date are valued at the latest available net asset values of the respective fund. Unrealised gains/losses arising due to changes in the fair value of listed equity shares and mutual fund units...

  • Page 150
    ...at cost. Unrealised gains/losses arising due to changes in the fair value of listed equity shares and mutual fund units are taken to 'Revenue and other reserves' in the balance sheet for general insurance business. The general insurance subsidiary assesses at each balance sheet date whether there is...

  • Page 151
    ...into for trading purposes are marked to market and the resulting gain/loss, (net of provisions, if any) is accounted for in the profit and loss account. Pursuant to RBI guidelines, any receivables under derivative contracts which remain overdue for more than 90 days and mark-to-market gains on other...

  • Page 152
    ... Financial Inclusion Network & Operations Limited, I-Process Services (India) Private Limited, I-Solutions Providers (India) Private Limited (up to September 30, 2011)1, NIIT Institute of Finance Banking and Insurance Training Limited, Comm Trade Services Limited, Prize Petroleum Company Limited...

  • Page 153
    ...664.4 million) and with I-Process Services (India) Private Limited amounting to ` 606.5 million (March 31, 2011: ` 392.9 million). Purchase of investments During the year ended March 31, 2012, the Group invested in equity warrants of Financial Inclusion Network & Operations Limited amounting to ` 40...

  • Page 154
    ... Merchant Services Private Limited amounting to ` 48.0 million (March 31, 2011: Nil) and with Financial Inclusion Network & Operations Limited amounting to ` 3.5 million (March 31, 2011: ` 7.0 million). Dividend paid During the year ended March 31, 2012, the Bank paid dividend to its key management...

  • Page 155
    ... March 31, 2011 22.3 9.1 Deposits ...Advances ...3. Employee Stock Option Scheme (ESOS) In terms of the ESOS, as amended, the maximum number of options granted to any eligible employee in a financial year shall not exceed 0.05% of the issued equity shares of the Bank at the time of grant of the...

  • Page 156
    schedules forming part of the Consolidated Accounts (Contd.) If ICICI Bank had used the fair value of options based on binomial tree model, compensation cost in the year ended March 31, 2012 would have been higher by ` 1,816.1 million. The key assumptions used to estimate the fair value of options ...

  • Page 157
    ... shares arising out of options (Number of shares) 12,762,698 Weighted average exercise price (` per share) 211.43 Weighted average remaining contractual life (Number of years) 5.10 30-400 ICICI General: ICICI Lombard General Insurance Company has formulated various ESOS schemes to their employees...

  • Page 158
    ...of the stock option plan of ICICI Lombard General Insurance Company. `, except number of options Stock options outstanding Year ended March 31, 2012 Year ended March 31, 2011 Number Weighted Number Weighted of shares average of shares average Particulars exercise price exercise price Outstanding at...

  • Page 159
    ... Consolidated Accounts (Contd.) 5.2 Assets under finance lease The following table sets forth, for the periods indicated, the details of finance leases. ` in million Particulars Future minimum lease receipts ...Present value of lease receipts ...Unmatured finance charges ...Total ...Maturity profile...

  • Page 160
    ...year ...Present value of the defined benefit obligations at the end of the year ...Amount not recognised as an asset (limit in para 59(b) of AS 15 on 'employee benefits') ...Asset/(liability)...Cost for the year Service cost ...Interest cost ...Expected return on plan assets ...Actuarial (gain)/loss...

  • Page 161
    ...gain)/loss ...Past service cost ...Transitional obligation/(asset) ...Addition due to amalgamation ...Liability assumed on acquisition/(settled on divestiture) ...Benefits paid ...Obligations at the end of year ...Opening plan assets, at fair value ...Expected return on plan assets ...Actuarial gain...

  • Page 162
    ... return on plan assets ...Actuarial (gain)/loss ...Past service cost ...Losses/(gains) on "Acquisition/Divestiture" ...Exchange fluctuation loss/(gain)...Transitional obligation/(Asset) ...Effect of the limit in para 59(b) of AS 15 on 'employee benefits'...Net cost ...Investment details of plan...

  • Page 163
    ...,072.1 79.5 3,853.9 32,005.5 29,506.7 - 4,972.1 34,478.8 At March 31, 2012 At March 31, 2011 At March 31, 2012, ICICI Prudential Life Insurance Company has created deferred tax asset on carry forward unabsorbed losses amounting to ` 860.3 million (March 31, 2011: ` 1,330.8 million) which can be set...

  • Page 164
    ... includes ICICI Home Finance Company Limited, ICICI International Limited, ICICI Securities Primary Dealership Limited, ICICI Securities Limited, ICICI Securities Holdings Inc., ICICI Securities Inc., ICICI Prudential Asset Management Company Limited, ICICI Prudential Trust Limited, ICICI Investment...

  • Page 165
    ... Accounts (Contd.) 6 Segment assets 7 Unallocated assets2 8 Total assets (6) + (7) 9 Segment liabilities 10 Unallocated liabilities 11 Total liabilities (9) + (10) 12 Capital expenditure 13 Depreciation & amortisation 1. 2. 3. Includes share of net profit of minority shareholders...

  • Page 166
    ... liabilities (9) + (10) 12 Capital expenditure 25,103.3 7,396.8 13 Depreciation & amortisation 1. Includes share of net profit of minority shareholders. forming part of the Consolidated Accounts (Contd.) 2. Includes assets which cannot be specifically allocated to any of the segments, tax...

  • Page 167
    schedules forming part of the Consolidated Accounts (Contd.) B.   Geographical segments The Group has reported its operations under the following geographical segments. ‡ Domestic operations comprise branches and subsidiaries/joint ventures in India. ‡ Foreign operations comprise branches and ...

  • Page 168
    ... up to February 2012 and on management's estimate for March 2012. In accordance with regulations, the Pool had followed a policy of providing for Unexpired Risk Reserve at a minimum of 50.0% of the Pooled business. Accordingly company has carried forward 50.0% of current year premiums from the Pool...

  • Page 169
    ... financial statements. 19. Comparative figures Figures of the previous year have been re-grouped to conform to the current year presentation. SIGNATURES TO SCHEDULES 1 TO 18 For and on behalf of the Board of Directors For S.R. BATLIBOI & CO. Firm's Registration no.: 301003E Chartered Accountants...

  • Page 170
    ... Investments include securities held as stock in trade. 5. Dividend paid includes proposed dividend and dividend paid on preference shares. 6. The financial information of ICICI Bank UK PLC and ICICI International Limited have been translated into Indian Rupees at the closing rate on March 31, 2012...

  • Page 171
    ...ICICI Bank Eurasia Limited Liability Company ICICI Securities Limited ICICI Securities Inc. ICICI Securities Holdings Inc. ICICI Securities Primary Dealership Limited ICICI Venture Funds Management Company Limited ICICI Home Finance Company Limited ICICI Trusteeship Services Limited ICICI Investment...

  • Page 172
    ... Asset Management Company Limited ICICI Prudential Trust Limited TCW/ICICI Investment Partners Limited Rainbow Fund 27 Financial Inclusion Network & Operations Limited 28 I-Process Services (India) Private Limited 29 NIIT Institute of Finance, Banking and Insurance Training Limited ICICI...

  • Page 173
    ...insurance entities The book value of the Bank's total interest in its insurance subsidiaries at March 31, 2012, which is deducted from capital for capital adequacy under Basel II is detailed in the following table. ` in billion Name of the entity ICICI Prudential Life Insurance Company Limited ICICI...

  • Page 174
    ...: Investments in instruments eligible for regulatory capital of financial subsidiaries/ associates Securitisation exposures including credit enhancements Deferred tax assets Others3 Minority interest not eligible for inclusion in Tier-1 capital Net Tier-1 capital 1. 2. 3. Includes preference shares...

  • Page 175
    ... of credit rating agencies, shareholders and investors; future strategy with regard to investments or divestments in subsidiaries; and evaluation of options to raise capital from domestic and overseas markets, as permitted by RBI from time to time. The Bank formulates its internal capital level...

  • Page 176
    ... of the ICICI Group (consolidated) is reported to the Board on a half-yearly basis. Further, the ICAAP which is an annual process also serves as a mechanism for the Board to assess and monitor the Bank's and the Group's capital adequacy position over a four year time horizon. Capital adequacy of the...

  • Page 177
    ... of the business groups/ sub-groups. The risk management framework forms the basis of developing consistent risk principles across the Bank, overseas branches and overseas banking subsidiaries. Material risks are identified, measured, monitored and reported to the Board of Directors and Board level...

  • Page 178
    ... governed by Credit and Recovery Policy (Credit Policy). Credit Policy outlines the type of products that can be offered, customer categories, target customer profile, credit approval process and limits. The Credit Policy is approved by the Board of Directors. The delegation structure for approval...

  • Page 179
    ... groups, exposure to capital market segment and unsecured exposures for the ICICI Group (consolidated) are reported to the senior management committees on a quarterly basis. Limits on countries and bank counterparties have also been stipulated. Definition and classification of non-performing assets...

  • Page 180
    ...than three months old even though the unit may be working or the borrower's financial position is satisfactory; or e. the regular/ad hoc credit limits have not been reviewed/renewed within 180 days from the due date/date of ad hoc sanction. iv) a bill purchased/discounted by the Bank remains overdue...

  • Page 181
    ... FMCG Venture capital funds Other industries Grand Total 3 1. 2. 3. Includes home loans, automobile loans, commercial business loans, two wheeler loans, personal loans, and credit cards. Also includes dealer funding exposures and developer financing exposures. Includes balances with banks. Includes...

  • Page 182
    ... the Bank and its banking subsidiaries, ICICI Home Finance Company, ICICI Securities Primary Dealership Limited and ICICI Securities Limited and its subsidiaries. The maturity pattern of assets for the Bank is based on methodology used for reporting positions to the RBI on asset-liability management...

  • Page 183
    ... opening and closing balances (other than accounts written off during the year) of provisions on credit cards is included in provisions made during the year. Includes advances portfolio of the Bank and its banking subsidiaries and ICICI Home Finance Company. h. Amount of non-performing investments...

  • Page 184
    ... for Basel II capital adequacy computation. 7. CREDIT RISK MITIGATION a. Collateral management and credit risk mitigation The Bank has a Board approved policy framework for collateral management and credit risk mitigation techniques, which include among other aspects guidelines on acceptable types...

  • Page 185
    ... loans and current assets for working capital finance. For project finance, security of the assets of the borrower and assignment of the underlying project contracts is generally taken. In addition, in some cases, additional security such as pledge of shares, cash collateral, charge on receivables...

  • Page 186
    ... backed by financial assets originated by third parties for purposes of investment/trading/market-making with the aim of developing an active secondary market in securitised debt. ‡ Structurer: structuring appropriately in a form and manner suitably tailored to meet investor requirements, while...

  • Page 187
    ... to market risks arising on account of interest rate/currency fluctuations. ‡ Operational risk: i) Co-mingling risk: Risk arising on account of co-mingling of funds belonging to investor(s) with that of the originator and/or collection and processing servicer, when there exist a time lag between...

  • Page 188
    ...at book value. There is no change in the methods and key assumptions applied in valuing retained/purchased interests from previous year. Policies for recognising liabilities on the balance sheet for arrangements that could require the bank to provide financial support for securitised assets The Bank...

  • Page 189
    ... purchased (March 31, 2012) ` in billion Exposure type 1 28.07 On-balance sheet 3.03 17.09 0.40 3.20 6.06 29.78 Off-balance sheet 6.78 0.20 1.07 9.18 10.30 27.52 Total 9.81 17.29 1.47 12.38 16.35 57.30 Vehicle/equipment loans Home and home equity loans Personal loans Corporate loans Mixed asset...

  • Page 190
    ... in the trading book I. Aggregate amount of exposures securitised for which the Bank has retained some exposures subject to market risk (March 31, 2012) ` in billion Exposure type Vehicle/equipment loans Home and home equity loans Personal loans Corporate loans Mixed asset pool Total 1. The amounts...

  • Page 191
    ... IN TRADING BOOK a. Market risk management policy Risk management policies Market risk is the possibility of loss arising from changes in the value of a financial instrument as a result of changes in market variables such as interest rates, exchange rates, credit spreads and other asset prices. The...

  • Page 192
    ... transactions. Structure and organisation of the market risk management function The Market Risk Management Group (MRMG), which is an independent function reports to the Head - RMG. MRMG exercises independent control over the process of market risk management and recommends changes in policies...

  • Page 193
    ... Management Policy (the Policy) approved by the Board of Directors. The Policy aims to: ‡ Define Bank level operational risk appetite; ‡ Establish clear ownership and accountability for management and mitigation of operational risk; ‡ Help business and operations to improve internal controls...

  • Page 194
    ... controls are tested by Internal Audit Group in the Bank. The testing results are incorporated in the operational risk assessment. The Bank has a comprehensive Product and Process Approval framework along with the detailed operating guidelines for effective new product and process risk management...

  • Page 195
    ... Further, the Asset Liability Management (ALM) groups in overseas branches manage the risk at the respective branches, under direction of the Bank's ALMG group. The ALM Policy of the Bank contains the prudential limits on liquidity and interest rate risk, as prescribed by the Board of Directors/Risk...

  • Page 196
    ...stop loss limits. The management of price risk of the trading book is detailed in the Investment Policy. Hedging policy Depending on the underlying asset or liability and prevailing market conditions, the Bank enters into hedge transactions for identified assets or liabilities. The Bank has a policy...

  • Page 197
    ..., ICICI Home Finance Company, ICICI Securities Primary Dealership Limited, ICICI Securities and its subsidiaries. 12. LIQUIDITY RISK Liquidity risk is the risk of inability to meet financial commitments as they fall due, through available cash flows or through sale of assets at fair market value...

  • Page 198
    ... to time. Loan maturities and sale of investments also provide liquidity. The Bank holds unencumbered, high quality liquid assets to protect against stress conditions. For domestic operations, the Bank also has the option of managing liquidity by borrowing in the inter-bank market on a short-term...

  • Page 199
    ... Executives f) Product & Processes Approval Committee g) Banking Operations and Premises Committee The policies approved by the Board of Directors form the governing framework for overall risk management. The key policies in this regard are Asset Liability Management Policy, Investment Policy, Anti...

  • Page 200
    ... Policy defines product-wise approval limits for various underwriters. The Investment Policy lays down the asset allocation strategy to ensure financial liquidity, security and diversification. The Company also has in place a Capital Adequacy and Liquidity Management Framework and an Asset Liability...

  • Page 201
    ... area of investments, the investment risk oversight reporting forms part of the Risk Management Committee agenda. The company has in place various policies to manage operational risk such as the business continuity plan, information technology security policy, product and process approval guidelines...

  • Page 202
    ... Operating profit divided by working funds Net profit after tax divided by average total assets Net profit after tax divided by number of employees Average deposits plus average advances divided by number of employees Quarterly average of equity share capital and reserves Averages of daily balances...

  • Page 203
    ... our products and services, as well as though our development initiatives and community outreach. sustainable livelihoods. This will be achieved through active collaboration with the government and independent organisations." ICICI Foundation believes that in order to make India's growth inclusive...

  • Page 204
    ... State Government in February 2012 and will be used in schools in the new academic year (2012-13) ‡ Approach paper and syllabus guidelines were developed for pre-service teacher training ‡ Module for training of Master Trainers (MTs) was developed ‡ School Management Committee Report finalised...

  • Page 205
    ... alone is not enough to create a sustainable impact. Keeping this in mind, ICICI Foundation has facilitated job placement by building industry linkages, creating support structures for candidates starting their own ventures and conducting regular follow-up of its alumni. Annual Report 2011-2012 P3

  • Page 206
    ... in health focuses on improving access to healthcare for the poorest communities in India by improving the public health delivery systems. ICICI Foundation supports and works collaboratively on a range of initiatives that have the potential to translate into large-scale and sustainable improvements...

  • Page 207
    .... The Foundation will work with and strengthen the delivery of services within the Integrated Child Development Scheme (ICDS). The baseline study for the programme has commenced. (iii) Healthy Lokshakti Healthy Lokshakti is a joint initiative of ICICI Foundation and ICICI General to reduce newborn...

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    ... Child Development Services (ICDS). (vi) Village Health Committee - Sahiyya Resource Programme This year also marked the successful conclusion of our Village Health Committee-Sahiyya Resource Centre community health worker initiative, in Jharkhand. Since 2008, ICICI Foundation has worked in...

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    ... by supporting the development of new models for delivering financial services. In addition to the ICICI Group's direct work in the area of financial inclusion, ICICI Foundation partners with ICICI Group companies to provide greater access to and create awareness of finance in communities where...

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    ... Day, 2012. 7. Clean Technology Initiatives ICICI Bank's Technology Finance Group (TFG) currently implements programmes on behalf of the Government of India in the areas of energy, environment, agribusiness and assisting technology institutions to upgrade their infrastructure to international...

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    ... THE MOST TRUSTED BRAND AMONG PRIVATE SECTOR BANKS IN 2011 Once again, we have been voted the Most Trusted Brand among Private Sector Banks in the Economic Times - Brand Equity Most Trusted Brands Survey. We thank you for your support and will continue to work towards further enhancing your trust...

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