Item 3
ICICI Limited
Performance Review for the three-month period ended June 30, 2000 of ICICI Bank
Limited (subsidiary of ICICI Limited)
ICICI Bank reports a near doubling of its net profits for the first quarter of
this fiscal. The net profit was Rs. 40.14 crores as compared to Rs. 20.25
crores for the corresponding period in the previous financial year.
The Board of Directors of the ICICI Bank Limited (NYSE Code : IBN) met in
Mumbai, India, on July 20, 2000 and adopted the audited financial results drawn
up as per the accounting standards followed in India for the three-month period
ended June 30, 2000. The Board of Directors also took on record the Bank's
unaudited financials prepared under the United States Generally Accepted
Accounting Principles (US GAAP) for the same period.
Results as per the accounting standards followed in India
For the first quarter ended June 30, 2000, the net interest income showed an
increase of over 124 per cent at Rs. 85.37 crores (previous year corresponding
period - Rs. 38.09 crores). Interest income increased by 43 per cent to Rs.
283.56 crores (previous year corresponding period - Rs. 198.92 crores).
Overall, other income recorded a growth of 34 per cent to Rs. 31.23 crores
(previous year corresponding period - Rs. 23.28 crores), aided by fee income
growth of 101 per cent. During the quarter, backed by its increased net worth,
the Bank reshuffled the composition of its deposits by gradually liquidating
higher-cost deposits leading to an improvement in interest rate spreads.
Interest expenditure increased by 23 per cent to Rs. 198.19 crores (previous
year corresponding period - Rs.160.83 crores). Operating profit increased 71
per cent to Rs. 61.87 crores compared to Rs. 36.21 crores of the corresponding
period in the previous year. The Return on Average Assets (RoAA) stood at 1.46
per cent for the quarter.
Total deposits as at June 30, 2000 stood at Rs. 8,740 crores as against Rs.
5,954 crores as at June 30, 1999 and Rs. 9,866 crores at March 31, 2000. Total
customer assets (including credit substitutes) were at Rs. 5,361 crores,
compared to Rs. 3,449 crores at June 30, 1999 and Rs. 5,031 crores at March 31,
2000.
The Bank has provided for depreciation on investments, and provision for bad
debts and standard assets as per the guidelines of the Reserve Bank of India.
The ratio of net non-performing assets to total customer assets remained more
or less unchanged at 1.16 per cent on June 30, 2000 as against 1.14 per cent on
March 31, 2000. The Bank's capital adequacy ratio stood at 19.24 per cent of
the risk-weighted assets on June 30, 2000.
Results under US GAAP
For the three-month ended June 30, 2000, the Net-Income for the period
increased by 69 per cent to Rs. 44.60 crores from Rs. 26.40 crores. The net
interest income after provision for credit losses increased by 159 per cent to
Rs. 77.70 crores from Rs.30.00 crores in the corresponding period of the
previous financial year.
Significant growth in customer accounts
During the first quarter, the Bank added more than 225,000 new customer
accounts, including about 100,000 savings bank accounts and ended the quarter
with about 875,000 accounts. The number of savings accounts stood at around
400,000. The number of accounts of non-resident Indians increased to about
28,000 and the number of Internet banking customers increased during the
quarter from 110,000 to over 155,000. The retail deposits at Rs. 3,663 crores
constituted 42 per cent of the total deposits of the Bank.
<PAGE>
Technology driven distribution and product strategy
The Bank continued to leverage its strengths in the use of modern banking
technology to further improve its customer service. Initiatives in this regard
included launch of new products, such as bank@campus for students and
kid-e-bank for small children, in line with the Bank's strategy to be
associated in all stages of a person's life cycle. Both these products are
web-enabled and offer many innovative and attractive features to the target
customers. The Bank's web-enabled credit cards launched during January 2000
have received a good response. The Bank issued an additional 19,000 credit
cards during the three-month period ended June 30, 2000 taking the total number
of cards issued to around 30,000.
The Bank has concluded arrangements with various service providers and along
with other companies in the ICICI group, offers its customers a suite of
banking and utility products through the Internet. Towards this end, it
provides a whole range of services under B2B, B2C, mobile banking, etc. Most
transactions have been increasingly web-enabled to offer customers
location-independent and time-independent services.
Network expansion
During the quarter, the Bank crossed two milestones by opening more than 100
offices and installing more than 200 Automated Teller Machines (ATMs). During
the first quarter, the Bank expanded its distribution network by opening 4
branches and installing 33 additional work-site and off-site ATMs. As at June
30, 2000, the Bank's physical network consisted of 85 branches and 16 extension
counters. The Bank had 208 ATMs - the largest network of ATMs in the country -
spread across 49 centres in 17 States and Union Territories. This physical
distribution network is complemented by other technology driven delivery
channels such as web-enabled kiosks, call centres, mobile phones and the
Internet.
The summary of the accounts as at June 30, 2000 under both the accounting
standards followed in India (audited) and US GAAP (unaudited) is enclosed.
For further queries on results, contact :
P. H. Ravikumar - (91)-22-653 8413 or 653 8433
G. Venkatakrishnan - (91)-22-653 8516 or 653 8529
Mohan N. Shenoi - (91)-22-653 8418 or 653 8487
Note : (a) Rs. = Indian Rupees (b) crore = 10 million
(c) B2B - Business to Business (d) B2C - Business to consumer
<PAGE>
Audited financial results for the quarter ended June 30, 2000
<TABLE>
(Rupees in crores)
Sr.
No. Particulars Quarter ended Year ended
---- ----------- -------------------- ----------
June 30, June 30, Mar. 31,
2000 1999 2000
-------- -------- --------
<S> <C> <C> <C>
1. Interest Income 283.56 198.92 852.87
2. Other Income 31.23 23.28 194.05
3. Total Income 314.79 222.20 1046.92
4. Interest Expenditure 198.19 160.83 666.95
5. Total Operating Expenditure
(a) Staff Cost 12.03 6.84 36.37
(b) Depreciation 2.67 4.09 24.79
(c) Other Expenditure 40.03 14.23 92.15
6. Total Expenditure (4) + (5) 252.92 185.99 820.26
7. Gross Profit before tax and provisions 61.87 36.21 226.66
8. Provision for taxes 7.66 1.42 33.02
9. Other provisions 14.07 14.54 88.34
10. Net Profit 40.14 20.25 105.30
11. Paid up Equity Share Capital 196.82 165.00 196.82
12. Reserves (excluding Revaluation Reserves) 992.82 163.58 952.69
13. Total deposits 8739.77 5954.39 9866.02
14. Total advances (including Credit substitutes) 5361.48 3448.56 5030.96
15. Basic and diluted Earnings Per Share (not annualised for
the quarters) (in rupees) 2.04 1.23 6.38
</TABLE>
Notes :
1. Out of amortised ADS issue expenditure, Rs.2.45 crores has been charged
off during the quarter.
2. Depreciation on fixed assets has been charged over the estimated useful
life of the fixed assets on a straight line basis against WDV basis
adopted earlier leading to write back of excess depreciation of Rs.4.96
crores. The amount has been used to increase bad debts provision over and
above RBI norm on old NPAs of earlier years.
3. Net non-performing assets on advances (including credit substitutes) is
1.16% (1.14% as on 31.03.2000).
4. Item 5(c) includes Rent, taxes and lighting Rs.6.90 crores (Q1:1999-2000 -
Rs.3.86 crores and LY - Rs.18.01 crores). Other items included in 5(c)
individually do not exceed 10% of total operating expenditure.
Unaudited financial results under US GAAP accounting
<TABLE>
(Rupees in crores)
Particulars Quarter ended Year ended
----------- ------------------- ----------
June 30, June 30, Mar. 31,
2000 1999 2000
-------- -------- --------
<S> <C> <C> <C>
Net income under US GAAP 44.60 26.44 140.20
Reconciliation between US GAAP and Accounting Standards followed in India
Profit under Indian GAAP 40.14 20.25 105.30
Deferred taxation 1.06 0.60 (11.30)
Loan impairment (3.96) 4.20 35.80
ADR Issue expenditure charged to P & L A/c 2.45 .. 9.90
Others 4.91 1.39 0.50
Profit under US GAAP 44.60 26.44 140.20
</TABLE>
<PAGE>
The above financial results have been taken on record by the Board of Directors
of the Bank at its meeting held on July 20, 2000.
Except for the historical information contained herein, statements in this
Release which contain words or phrases such as 'will', 'would', 'aim', 'will
likely result', 'believe', 'expected', 'will continue', 'anticipate',
'estimate', 'enable', 'enabling', 'intend', 'plan', 'contemplate', 'seek to',
'future', 'objective', 'goal', 'project', 'should', 'will pursue' and similar
expressions or variations of such expressions may constitute 'forward-looking
statements'. These forward-looking statements involve a number of risks,
uncertainties and other factors that could cause actual results to differ
materially from those suggested by the forward-looking statements. These risks
and uncertainties include, but are not limited to our and ICICI's Group's
ability to obtain statutory and regulatory approvals and to successfully
implement our strategy, future levels of non-performing loans, our growth and
expansion in business, the adequacy of our allowance for credit losses,
technological implementation and changes, the actual growth in demand for
banking products and services, investment income, cash flow projections, our
exposure to market risks as well as other risks detailed in the reports filed
by us with the United States Securities and Exchange Commission. The Bank
undertakes no obligation to update forward-looking statements to reflect events
or circumstances after the date hereof.
July 20, 2000
For further investor queries:
Contact: Bhashyam Seshan at 91-22-653 8420 or email at [email protected]
END
