ICICI Bank Q3 Results Review - Margin Expansion, Lower Opex Aid Operating Profit: Systematix
ICICI Bank’s balance sheet is in a strong position in terms of PCR, contingent provision, revision in provisioning policy.
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Systematix Research Report
In Q3 FY23, ICICI Bank Ltd.'s core operating performance (pre-provision operating profit excluding interest income on IT refunds and treasury gains) improved further to 352 basis points (as a percentage to average assets) from 324 bps in Sep-22.
The improvement was driven by margin expansion and lower operating expenses; margin expansion by 34 bps on QoQ (to 465 bps) was an asset-side phenomenon.
Asset yield and funding cost inched up by 48 bps (to 807 bps) and by 17 bps (to 395 bps) respectively. On the asset quality front, ICICI Bank’s gross delinquency increased marginally to 284 bps (from 231 bps in Sep-22) and the net delinquency rate was at 55 bps as against 32 bps in Sep-22.
ICICI Bank has further strengthened its balance sheet by making a fresh contingent provision of Rs 15 bn and raising provision coverage ratio to ~83%.
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