2010 10 Q2 2011 Investor Presentation
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Transcript of 2010 10 Q2 2011 Investor Presentation
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Performance Review:Q2-2011October 29, 2010
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Certain statements in these slides are forward-looking statements.These statements are based on management's current expectations andare subject to uncertainty and changes in circumstances. Actual resultsmay differ materially from those included in these statements due to avariety of factors. More information about these factors is contained inICICI Bank's filings with the Securities and Exchange Commission.All financial and other information in these slides, other than financialand other information for specific subsidiaries where specificallymentioned, is on an unconsolidated basis for ICICI Bank Limited onlyunless specifically stated to be on a consolidated basis for ICICI BankLimited and its subsidiaries. Please also refer to the statement ofunconsolidated, consolidated and segmental results required by Indianregulations that has, along with these slides, been filed with the stockexchanges in India where ICICI Banks equity shares are listed and w iththe New York Stock Exchange and the US Securities ExchangeCommission, and is available on our website www.icicibank.com.
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Overview
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Q2-2011: Profitability highlights 18.8% increase in standalone profit after tax to ` 12.36bn in Q2-2011 from ` 10.40 bn in Q2-2010 Net interest income up 8.3% year-on-year
Increase in net interest margin to 2.6% in Q2-2011 from2.5% in Q2-2010 Fee income up 14.6% year-on-year Provisions down 40.2% year-on-year to ` 6.41 bn (Q2-2010: ` 10.71 bn; Q1-2011: ` 7.98 bn) Increase in consolidated profit after tax by 21.8% to `
13.95 billion in Q2-2011 compared to ` 11.45 billion inQ2-20101. The merger of erstwhile Bank of Rajasthan (e-BoR)was effective from close of business of August 12,2010. Financials for the quarter include operations
of e-BoR from August 13, 2010.
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Q2-2011: Balance sheet highlights Continued sequential expansion in advances to `1,942.01 bn at September 30, 2010 from ` 1,843.78bn at June 30, 2010 Continued growth in CASA deposits to ` 981.05 bn atSeptember 30, 2010 from ` 729.30 bn at September30, 2009
Increase in CASA ratio to 44.0% at September 30,2010 Average CASA ratio at 39.2% in Q2-2011
1. All numbers for September 30, 2010 are including e-BoR2. At Aug 12, 2010, e-BoR had advances: ` 65.28 bn;
deposits: ` 134.83 bn; CASA deposits: ` 46.80 bn
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Q2-2011: Balance Sheet highlights Net NPA ratio decreased to 1.37% at September 30,2010 (June 30, 2010: 1.62%; September 30, 2009:2.19%) Provisioning coverage ratio increased to 69.0% atSeptember 30, 2010 (June 30, 2010: 64.8%;September 30, 2009: 51.7%) Strong capital adequacy ratio of 20.2% and Tier-1capital adequacy of 13.8%
1. At Aug 12, 2010, e-BoR had networth: ` 3.56 bn;gross NPA: ` 4.11 bn; net NPA: ` 1.07 bn
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Merger of Bank of Rajasthan At August 12, 2010 BoR had total assets of ` 155.96 bn,
advances of ` 65.28 bn and deposits of ` 134.83 bn (includingCASA deposits ` 46.80 bn)
Networth at August 12, 2010 was ` 3.56 bn compared to `9.37 bn at March 31, 2010 reflecting primarily provisions foremployee benefits, move to 70% provision cover on NPAs anddeferred tax asset reversal in e-BoR books prior to merger
Fair valuation adjustment of ` 2.70 bn through reserves onmerger, primarily due to impact of alignment to ICICI Bank payscale on gratuity liability and mark-to-market on HTMinvestment portfolio
Accounts merged from August 13, 2010
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Unconsolidated financials
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Profit & loss statement
-9.2%44.0022.1221.8849.6424.3597.32Operating profit
-23.9%.57.35.22.98.46.42ease depreciation
-0.401.44.040.11.971.81Treasury income
0.7129.25
74.53
2.9530.0332.5841.95H1-
2011
0.2113.58
38.60
1.4013.8718.2420.36Q2-
2010
0.4828.25
79.35
1.9727.0639.1440.21H1-
2010
0.3515.00
37.82
1.3215.9015.7822.04Q2-
2011
1.2555.93
155.92
6.4756.5074.7881.14FY
2010
0.3614.25
36.71
1.6314.1316.8019.91Q1-
2011
-2.0%Total income
66.7%10.5%
-5.7%14.6%
-13.5%8.3%
Q2-o-Q2
growth
DMA expensesOperating expenses
- Other income- Fee incomeNon-interest incomeNII
(` billion)
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Profit & loss statement
40.25
13.2053.45
43.8797.32
FY
2010
10.40
3.2413.64
10.7124.35
Q2-
2010
19.18
6.5125.69
23.9549.64
H1-
2010
(9.2)%44.0022.1221.88Operating profit
12.36
3.3515.71
6.41
Q2-
2011
22.62
6.9929.61
14.39
H1-
2011
(40.2)%.98rovisions
10.26
3.6413.90
Q1-
2011
18.8%
3.4%15.2%
Q2-o-Q2
growth
Profit before tax
Profit after tax
Tax
(` billion)
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Balance sheet: Assets
(10.5)%96.8202.2078.34SLR investments0.8%22.0022.0021.00
- Equity investment insubsidiaries
3,663.74
262.821,908.60
1,199.65292.67
September
30, 2009
13.6%,362.75,275.71nvestments
3,639.97
216.031,843.78
304.45June 30,
2010
3,899.98
246.741,942.01
348.48September
30, 2010
6.4%
(6.1)%1.8%
19.1%Y-o-Y
growth
Total assets
Fixed & other assetsAdvances
Cash & bank balances
(` billion)
Investment in security receipts of asset reconstruction companiesat September 30, 2010 was ` 30.95 bn Credit derivative exposure (including off balance sheet exposure)of ` 45.06 bn at September 30, 2010 (underlying comprises Indiancorporate credits)Including impact of exchange rate movement
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SME4%
Rural7%
Retailbusiness
group40%
Overseasbranches
25%
Domesticcorporate
24%
Composition of total loan book
Total loan book: ` 1,942 bnTotal loan book: ` 1,844 bn
1. Retail business group includes builder loans and dealer
funding
S M E4 %
R u r a l9 %
R e ta i lb u s i n e s s
g r o u p4 1 %
O v e r s e a sb r a n c h e s2 6 %
D o m e s t i cc o r p o r a t e
2 0 %
At June 30, 2010 At September 30, 2010
1 1
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Composition of retail loan book
Total retail loan book: ` 781 bnTotal retail loan book: ` 763 bn1. June 30, 2010 :Vehicle loans includes auto loans 10%
and commercial business 16%
2. September 30, 2010 :Vehicle loans includes auto loans
9% and commercial business 15%
At June 30, 2010 At September 30, 2010
V e h i c l el o a n s2 6 % H o m e6 2 %
P e r s o n a ll o a n s
5 %O t h e r
s e c u r e d2 %
C r e d i tc a r d s
5 %
Vehicleloans24% Home
65%
Personalloans
4%thersecured3%
Creditcards
4%
1 2
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Equity investment in subsidiaries
121.00
0.140.050.610.871.583.00
10.9611.1223.2533.5035.93
September
30, 2009
122.00
0.140.050.611.871.583.00
10.9611.1223.2533.5035.93
June 30,
2010
11.12CICI Home Finance23.25CICI Bank UK
0.61CICI AMC
33.50CICI Bank Canada
3.00CICI Bank Eurasia LLC10.96CICI Lombard General Insurance
1.58CICI Securities Primary Dealership
0.14thers122.00
0.05
1.87
35.93September
30, 2010
Total
ICICI Venture Funds Mgmt
ICICI Securities Limited
ICICI Prudential Life Insurance
(` billion)
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Balance sheet: Liabilities
28.2%32.4865.4693.18Savings47.6%48.5780.7236.12Current
3,663.74
171.611,001.23
1,978.32501.4411.14
512.58September
30, 2009
3,639.97
152.64949.97
2,009.13517.07
11.16528.23
June 30,
2010
3,899.98
159.19970.10
2,230.94528.2411.51
539.75September
30, 2010
6.4%
(7.2)%(3.1)%
12.8%5.3%3.3%5.3%
Y-o-Y
growth
Borrowings1
Total liabilities
Other liabilities
Deposits- Reserves- Equity capital
Net worth
(` billion)
Credit/deposit ratio of 68% on the domestic balance sheet atSeptember 30, 2010Including impact of exchange rate movement
1. Borrowings include preference shares amounting to ` 3.50 billion
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Composition of borrowings
1,001.23487.8216.28
504.10234.42262.71497.13
September
30, 2009
488.5999.27verseas147.9134.22Other borrowings 333.6016.48Capital instruments
1
970.10473.37
15.22
481.51September
30, 2010
949.97483.5515.72
450.70June 30,
2010
Total borrowings- Other borrowings- Capital instruments
Domestic
Capital instruments contribute 69% of domestic borrowings1. Includes preference share capital ` 3.50 bn
(` billion)
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Capital adequacy (Basel II)
736.0284.4539.11Off balance sheet2,430.78,335.93,501.21On balance sheet
3,020.37187.22422.97610.19` bn
June 30, 2010
6.2%14.0%20.2%%
6.4%13.8%20.2%%
3,166.80204.02436.55640.57` bn
September 30,
2010
3,240.32141.67431.42573.09` bn
September 30,
2009
4.4%13.3%17.7%%
Risk weighted assets- Tier II- Tier I
Total Capital
Basel II
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Key ratios
9.70.7.6.1.5.6eturn on average net worth1,2(Consolidated basis)
1.6.6.6.6.5.6ost to average assets (incl.DMA)236.9%
36.734.52.4460
34.41.0
7.5H1-
2010
42.1%
40.038.7
2.5474
36.91.2
7.9Q1-
2011
1.2.3.2.1eturn on average assets2
44.0%4.0%6.9%1.7%ASA ratio
36.136.4
2.5460
37.1
8.1Q2-
2010
41.042.4
2.6470
43.3
9.2Q2-
2011
40.540.62.6470
40.2
8.5H1-
2011
36.6ee to income37.0
2.5463
36.1
7.9FY
2010
Book value (`)
Cost to income (incl. DMA)
Net interest margin2
Weighted avg EPS (`)2
Return on average net worth1, 2(Percent)
1. Based on quarterly average net worth2. Annualised for all interim periods
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Asset quality and provisioning
Gross retail NPLs at ` 67.99 bn and net retail NPLs at ` 17.12bn at September 30, 2010
Net restructured loans of ` 25.78 bn at September 30, 2010 Outstanding general provision on standard assets: ` 14.80 bnat September 30, 2010 Provisioning coverage ratio of 69.0% at September 30, 2010computed in accordance with RBI guidelines
(` billion)
1.62%35.1464.6399.77
June 30
2010
2.19%45.5849.1394.71
September
30, 2009
1.37%31.9270.41
102.33September
30, 2010
Net NPA ratioNet NPAsLess: Cumulative provisionsGross NPAs
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Overseas subsidiaries
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L o a n s &a d v a n c e s5 5 %
A s s e t b a c k e ds e c u r i t i e s
2 %
O t h e r a s s e t s &i n v e s t m e n t s
6 %
I n d i a l i n k e di n v e s t m e n t s
4 %
C a s h & l i q u i ds e c u r i t i e s
1 5 %B o n d s / no t e s o f
f i n a n c i a li n s t i t u t i o n s
1 8 %`
Bonds/notesof financialinstitutions
18%
Cash & l i quidsecurities
12%
India l i nkedinvestments
5%
Other assets &investments
6%sset backedsecurities
2%
Loans &advances
57%
`
ICICI Bank UK asset profile
1. Includes cash & advances to banks, T Bills and CDs2. Includes India-linked credit derivatives of US$ 121 mn atSeptember 30, 2010 (US$ 138 mn at June 30, 2010)3. Includes securities reclassified to loans & advances4. Does not include US$ 137 mn of ABS reclassifiedas loans & receivable in FY2009
Total assets: USD 7.2 bn
1
23
4
At June 30, 2010 At September 30, 2010
1
23
4
Total assets: USD 6.9 bn
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L o n g t e rm D e b t1 0 %
N e t w o r th9 %
T e r m d e p o s i ts5 1 %
O t h e rl i a b i l i t i e s
6 %
S y n d i c a t e dl o a n s &
i n t e r b a n kb o r r o w i n g s
8 %D e m a n dd e p o s i t s
1 6 %Long term
Debt10 %
Net worth9%
Term deposits46%
Other liabilit ies5%
Syndicatedloans &
interbankborrowings
11%
Demanddeposits
19%`
ICICI Bank UK liability profile
Total liabilities: USD 7.2 billion
At June 30, 2010 At September 30, 2010
Total liabilities: USD 6.9 billion Profit after tax of USD 8.4 million in Q2-2011 Capital adequacy ratio at 18.3% Net MTM writeback of USD 4.1 million (post-tax) in reserves inQ2-2011 Proportion of retail term deposits in total deposits at 75% at
September 30, 2010
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Cash & liquidsecurit ies
16%
Federallyinsured
mortgage4%
Other assets &investments
7%Asset backed
securities2%
India linkedinvestments
3%
Loans tocustomers
68%
`
ICICI Bank Canada asset profile
1. Includes cash & advances to banks and governmentsecurities2. Includes India-linked credit derivatives of CAD 88 mn atSeptember 30, 2010 (CAD 104 mn at June 30, 2010)
Total assets: CAD 5.0 bn
2
1
At June 30, 2010 At September 30, 2010
Total assets: CAD 5.2 bn
C a s h & l i q u i ds e c u r i t i e s
1 3 %
F e d e r a l l yi n s u r e d
m o r t g a g e7 %
O t h e r a s s e t s& in v e s t m e n t s
7 %A s s e t b ac k e d
s e c u r i t i e s2 %
I n d i a li n k e di n v e s t m e n t s
3 %
L o a n s t oc u s t o m e r s
6 8 %
`
2
1
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ICICI Bank Canada liability profile
Total liabilities: CAD 5.0 billion
B o r r o w i n g s1 %
N e t w o r t h1 9 %
D e m a n dd e p o s i t s
1 5 %
O t he r l i a b i l i t i e s3 % T e r m d e p o s its
6 2 %
Profit after tax of CAD 7.6 million in Q2-2011 Capital adequacy ratio at 22.9%
At June 30, 2010 At September 30, 2010
Total liabilities: CAD 5.2 billion
Borrowings1%
Net worth19%
Demanddeposits
15 %
Otherl iab i l i t ies
3% Term depo sits62%
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Other assets &investments
2%
Retail loans18%
Promissorynotes
1%
Cash & cashequivalents
37%
Corporatebonds
4%
Loans tocorporates &
banks38%
Other assets &investments3%
Corporatebonds3%
Promissorynotes10%
Cash & cashequivalents18%
Retail loans22%
Loans tocorporates &banks44%
ICICI Bank Eurasia asset profile
Total assets: USD 274 mn
1. Includes cash & call placements with banks,balances with central bank and nostro balances
Total borrowings of USD 168 million at September 30, 2010 Capital adequacy of 37.7% at September 30, 2010
1
At June 30, 2010 At September 30, 2010
Total assets: USD 353 mn
1
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Domestic subsidiaries
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ICICI Life
654.8400.93ssets Under Management0.151(0.69)tatutory profit/ (loss)
18.9%9.2%BP margin2.54.33ew Business Profit (NBP)
22.643.11enewal premium13.442.12nnualised premium equivalent (APE)
8.0%0.8%xpense ratio2
38.736.33otal premium
Q2-2011Q2-2010
(` billion)
Continued market leadership in private sector31. For Q2-2011, there was a surplus of ` 2.54 billion in the non-participating policyholders funds. Thesurplus in the non-participating funds would be available to be transferred to the shareholders account atthe end of the financial year based on the appointed actuarys recommendation. Including this surplus,the net profit after tax for the Q2-2011 would have been ` 2.69 billion2. Expense ratio: All expenses (excl. commission and front line sales cost) / (Total premium 90% of SinglePremium)3. During April 2010 September 2010 on new business retail weighted received premium basis
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ICICI General
Continued market leadership in private sector2
1. Excluding remittances from third party motorpool and including premium on reinsuranceaccepted2. For the period April 2010 - September 2010
1.04.51AT10.91.01ross premium1
Q2-2011Q2-2010(` billion)
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Other subsidiaries0.54.28CICI Home Finance
0.480.14
-0.38
Q2-2010
0.14CICI Prudential Asset ManagementCompany
0.29CICI Securities Ltd.
0.22(0.02)
Q2-2011Profit after tax
ICICI VentureICICI Securities PD
Consolidated profit after tax increased by 21.8% to ` 13.95billion in Q2-2011 compared to ` 11.45 billion in Q2-2010 If the surplus of ` 2.54 bn in the non-participatingpolicyholders funds of ICICI Life were transferred in Q2-2011, the Bank's consolidated profit after tax for Q2-2011would have been ` 15.83 billion
(` billion)
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Thank you