ICICI Bank Q2 FY25 results

ICICI Bank Q2 FY25 Results: Surpassing Expectations with a 14.5% Profit Jump and Robust Loan Growth

ICICI Bank has announced its Q2 FY25 results, reporting a 14.5% year-on-year (YoY) increase in standalone net profit, reaching ₹11,746 crore. This impressive growth beat analysts’ expectations, as a poll by Moneycontrol had forecasted a profit of ₹10,989 crore. Strong net interest income and robust non-interest income were key factors driving this performance.

Net Interest Income (NII) and Margins

For Q2 FY25, ICICI Bank’s net interest income (NII) grew by 9.5% YoY, totaling ₹20,048 crore. However, this fell slightly short of the Moneycontrol poll estimate of ₹20,845 crore. The net interest margin (NIM), a crucial profitability metric, was reported at 4.27%, reflecting a slight decline from 4.36% in the previous quarter and 4.53% in Q2 FY24. The dip in NIM may indicate rising costs, though it remains strong relative to industry standards.

Non-Interest Income and Fee Income

In addition to interest income, ICICI Bank’s non-interest income showed solid growth, rising 10.8% YoY to ₹6,496 crore. The bank’s fee income, which constitutes a significant portion of non-interest revenue, increased by 13.3% to ₹5,894 crore. This growth was largely driven by contributions from retail, rural, and business banking segments, underscoring the bank’s diversified income sources.

Strong Loan and Deposit Growth

ICICI Bank’s loan portfolio continued to expand steadily, with domestic loans growing by 15.7% YoY to ₹12.43 lakh crore. This growth reflects strong demand from retail and business segments, bolstering the bank’s asset base. On the liabilities side, total deposits reached ₹14.98 lakh crore, a 15.7% YoY increase, with an average CASA (Current Account Savings Account) ratio of 38.9%. The high CASA ratio indicates a healthy deposit mix that supports lower-cost funding.

Asset Quality and NPAs

Asset quality remains a critical factor for ICICI Bank, and Q2 FY25 brought positive news in this area. The gross non-performing asset (NPA) ratio improved to 1.97% as of September 30, 2024, down from 2.15% in the previous quarter. Similarly, the net NPA ratio was steady at 0.42%, slightly lower than 0.43% in Q1 FY25. The provision coverage ratio on non-performing loans stood at 78.5%, highlighting the bank’s commitment to managing potential credit risk.

Capital Adequacy and Treasury Gains

ICICI Bank’s capital position remains robust, with a total capital adequacy ratio of 16.66%, including profits from the first half of FY25. The CET-1 (Common Equity Tier 1) ratio, a key indicator of financial strength, was 15.96%. The bank’s treasury operations also made a notable contribution this quarter, achieving ₹680 crore in gains, a marked improvement over a ₹85 crore loss in the same period last year.

ICICI Bank Financials Breakdown

Period	Q2 FY25 (₹ crore)	Q1 FY25 (₹ crore)	Q-o-Q Growth	Q2 FY24 (₹ crore)	Y-o-Y Growth
Net Profit	11,746	–	–	10,261	+14.5%
Net Interest Income (NII)	20,048	–	–	–	+9.5%
Net Interest Margin (NIM)	4.27%	4.36%	-0.09%	4.53%	-0.26%
Non-Interest Income	6,496	–	–	–	+10.8%
Fee Income	5,894	–	–	–	+13.3%
Domestic Loans	12.43 lakh	–	–	–	+15.7%
Total Deposits	14.98 lakh	–	–	–	+15.7%
Gross NPA Ratio	1.97%	2.15%	-0.18%	–	–
Net NPA Ratio	0.42%	0.43%	-0.01%	–	–
CET-1 Ratio	15.96%	–	–	–	–
Treasury Gains	680	–	–	(85)	–

Conclusion

ICICI Bank’s Q2 FY25 results highlight a period of strong performance, with significant profit growth and expanding loans and deposits. While net interest margins showed a slight decline, overall profitability and asset quality remain robust. The positive YoY growth in both profit and income across segments, coupled with stable capital adequacy ratios, suggests a solid financial foundation moving forward. ICICI’s management has successfully navigated interest rate pressures and maintained a healthy loan portfolio, positioning the bank for sustainable growth in the upcoming quarters.