ICICI Bank 2013 Annual Report Download - page 6

Message from
the Managing Director
& CEO
CHANDA KOCHHAR Managing Director & CEO
remain stable. Our net NPA ratio at March 31, 2013
was 0.64% compared to 0.62% at March 31, 2012.
In fiscal 2013, we restructured loans aggregating
about ` 17.00 billion - significantly lower than the
loan restructuring of about ` 36.00 billion in the
previous financial year. As a result of the above,
we were able to contain total provisions as a
percentage of average loans at 66 basis points in
fiscal 2013 - marginally lower than the levels seen
in fiscal 2012.
• Fiscal2013alsosawasignificantimprovementin
our retail lending growth – a key target that we had
set for ourselves since fiscal 2012. Our organic
retail loan growth reached 25% on a year-on-year
basis at March 31, 2013. This sets the base for
continued momentum in this area going forward.
On an overall basis, our domestic loan growth of
18% year-on-year at March 31, 2013 was ahead of
overall banking system credit growth.
• Thecombinedeffectofimprovementinprofitability
parameters and growth in business volumes was
reflected in a 29% growth in ICICI Bank’s profit
after tax to ` 83.25 billion in fiscal 2013. This
translates into an increase of over 20 basis points
in the Bank’s return on assets to 1.66%.
• During fiscal 2013, we continued to see healthy
improvement in our consolidated profit after
In fiscal 2013, we followed a three-pronged
strategy of balancing growth, profitability and risk
management. Through this approach, we achieved
several key milestones, thereby further strengthening
our platform for profitable growth.
The year witnessed several challenges in the
operating and business environment. Even as
the global economic environment continued to
be subdued, we saw a significant slowdown in
economic growth in India. While India’s long-term
economic fundamentals and growth potential are
strong, the current challenges have had implications
for business sentiment, corporate profitability and
banking sector growth & asset quality. I am happy
to report that despite these developments, our
strategy of balancing growth, profitability and risk
management has enabled us to make continued
progress on our strategic path.
Let me take this opportunity to share with you some
of our key achievements during fiscal 2013:
• In fiscal 2013 was the first full year where ICICI
Bank achieved full year net interest margins of
above 3.0%. This is the result of our consistent
efforts to improve our funding profile as well as
spreads in both our domestic and international
businesses. Our strong deposit franchise is
reflected in our current & savings account (CASA)
ratio of about 42% at March 31, 2013, despite the
low growth in demand deposits for the system.
• Thefocus onoperating efficiencycontinuedinto
fiscal 2013, with equal emphasis on controlling
costs and generating higher revenues. This
resulted in a reduction in the cost-to-income ratio
for the Bank from 42.9% in fiscal 2012 to 40.5% in
fiscal 2013.
• Thetrendsinassetqualityforthebankingsector
have not been encouraging in fiscal 2013. The
banking sector has seen significant additions to
non-performing assets (NPA) and restructured
loans during the year. Despite these systemic
trends, ICICI Bank’s asset quality continued to
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