ICICI Bank 2013 Annual Report Download - page 59

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Annual Report 2012-2013 57
Net interest income and spread analysis
The following table sets forth, for the periods indicated, the net interest income and spread analysis.
` in billion, except percentages
Fiscal 2012 Fiscal 2013 % change
Interest income ` 335.42 ` 400.75 19.5%
Interest expense 228.08 262.09 14.9
Net interest income 107.34 138.66 29.2
Average interest-earning assets13,932.59 4,465.40 13.5
Average interest-bearing liabilities1` 3,603.51 ` 4,073.47 13.0%
Net interest margin 2.73% 3.11% —
Average yield 8.53% 8.97% —
Average cost of funds 6.33% 6.43% —
Interest spread 2.20% 2.54% —
1. The average balances are the averages of daily balances, except averages of foreign branches which are
calculated on a fortnightly basis.
2. All amounts have been rounded off to the nearest ` 10.0 million.
Net interest income increased by 29.2% from ` 107.34 billion in fiscal 2012 to ` 138.66 billion in fiscal
2013 reflecting an increase in net interest margin from 2.73% in fiscal 2012 to 3.11% in fiscal 2013 and a
13.5% increase in the average volume of interest-earning assets.
The yield on interest-earning assets increased from 8.53% in fiscal 2012 to 8.97% in fiscal 2013 offset,
in part, by an increase in the cost of funds from 6.33% in fiscal 2012 to 6.43% in fiscal 2013. The interest
spread increased from 2.20% in fiscal 2012 to 2.54% in fiscal 2013. Net interest margin increased from
2.73% in fiscal 2012 to 3.11% in fiscal 2013.
The following table sets forth, for the periods indicated, the trend in yield, cost, spread and margin.
Fiscal 2012 Fiscal 2013
Yield on interest-earning assets 8.53% 8.97%
- On advances 9.55 9.94
- On investments 7.24 7.73
- On SLR investments 7.34 7.80
- On other investments 7.10 7.62
- On other interest-earning assets 6.21 5.96
Cost of interest-bearing liabilities 6.33 6.43
- Cost of deposits 6.12 6.38
- Current and savings account (CASA) deposits 2.87 2.97
- Term deposits 8.21 8.47
- Cost of borrowings 6.71 6.54
Interest spread 2.20 2.54
Net interest margin 2.73% 3.11%
Yield on interest-earning assets increased from 8.53% in fiscal 2012 to 8.97% in fiscal 2013 primarily due
to the following factors:
• Yield on average advances increased from 9.55% in fiscal 2012 to 9.94% in fiscal 2013 primarily
due to an increase in yield on domestic and overseas corporate loans as a result of incremental
disbursements at higher lending rates and the full impact of increase in our base rate during fiscal
2012. However, subsequently we reduced our base rate to 9.75% with effect from April 23, 2012 in
response to a decrease in repo rate by 50 basis points in April 2012.