icici bank sees sharp fall in retail npa in fy13 _ business standard

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4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard http://www.business-standard.com/article/finance/icici-bank-sees-sharp-fall-in-retail-npa-in-fy13-113060400533_1.html 1/10 E-Paper | Today's Paper | SmartInvestor.in | BS Hindi | BS Motoring | BS Books | B2B Connect | Apps Sign in | Register Thursday, April 17, 2014 | 12:50 AM IST News Stock Quote Authors Advanced Search Finance » News » Banks

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Page 1: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

http://www.business-standard.com/article/finance/icici-bank-sees-sharp-fall-in-retail-npa-in-fy13-113060400533_1.html 1/10

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Page 2: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

http://www.business-standard.com/article/finance/icici-bank-sees-sharp-fall-in-retail-npa-in-fy13-113060400533_1.html 2/10

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ICICI Bank sees sharp fall in retail NPA in FY13

The bank's retail NPAs dropped sharply to 60% of total bad loans in March 2013

Abhijit Lele | Mumbai June 5, 2013 Last Updated at 00:41 IST

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Being selective in unsecured lending and tightening underwriting norms seem to have helped ICICI Bank, one of the

largest private sector banks in the country, to improve its retail portfolio. The portfolio became more robust in 2012-13,

with gross non-performing assets (NPAs) in the retail segment improving considerably. Retail NPAs dropped sharply to

60 per cent (of total NPAs) in March from 80 per cent in 2011-12, according to its annual report for 2012-13.

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Page 3: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

http://www.business-standard.com/article/finance/icici-bank-sees-sharp-fall-in-retail-npa-in-fy13-113060400533_1.html 3/10

The retail NPAs stood at Rs 5,814 crore, down from Rs 7,673 crore in FY12.

The total of bad loans marginally rose to Rs 9,647 crore in 2012-13 from Rs 9,563 crore in 2011-12. ICICI Bank’s

retail credit portfolio includes home loans, commercial business loans, automobile loans, and rural loans.

The balance sheets of commercial banks came under tremendous strain on economic slowdown stretching into a second year (2012-13), high interest rates and inflation.

Karthik Srinivasan, senior vice-president and co-head (financial sector ratings) at Icra, said the quality of ICICI Bank’s

retail asset portfolio had held up well. He added the bank had improved its underwriting standards, monitoring, andrecoveries, helping to effectively deal with asset quality of the retail portfolio.

ICICI said NPAs in the retail portfolio were 0.72 per cent of net retail loans in March this year, compared with 1.22

per cent in March 2012. The decrease in the ratio was primarily on account of a sharp decline in accretion to retailNPAs.

“Financial year 2013 also saw a significant

improvement in our retail lending growth. The

organic retail loan book growth reached 25 percent on a year-on-year basis as on March 31. This

sets the base for continued momentum in this

area,” said the bank. It added that it continues to

use advanced analytics to build customerrelationships and gain insights into services and

product needs of customers. Analytics-based triggers helped in risk management and transaction monitoring, the bank

noted. “These steps helped to achieve robust growth in our retail business during 2012-13.”

Between 2003 and 2006, the banking system as a whole saw significant expansion of retail credit. Retail loans

accounted for a major part of overall systemic credit growth. ICICI Bank was an aggressive player that grew its retail

portfolio.

The scene changed after the global financial crisis of 2008. With the uncertain and volatile economic environment, the

bank gave priority to risk containment, liquidity management and capital conservation.

It moderated the pace of retail credit expansion, especially for unsecured loans in second half of FY08 due to high assetprices and the increase in interest rates, according to the annual report.

After the clean up act, ICICI Bank followed strategy to grow secured retail loan book, especially giving home loans. Of

late, it has begun hawking unsecured loans in a measured way. It is giving personal loans and credit cards, both

components of unsecured credit, only to existing customers.

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Page 4: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

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Page 5: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

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Page 6: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

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Page 7: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

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Page 9: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

http://www.business-standard.com/article/finance/icici-bank-sees-sharp-fall-in-retail-npa-in-fy13-113060400533_1.html 9/10

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Page 10: ICICI Bank Sees Sharp Fall in Retail NPA in FY13 _ Business Standard

4/17/2014 ICICI Bank sees sharp fall in retail NPA in FY13 | Business Standard

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