Indian Banks Report Earnings, SBI and ICICI Profits Rise
India’s two largest banks reported their earnings last week. Both State Bank of India (SBI) the country’s biggest bank and ICICI Bank, the nations number two lender showed an increase in quarterly profits.
ICICI Bank, shares gained over 2.5% on Thursday after the lender reported a 1.1% rise in quarterly net profit. Net profit for the quarter ending September was Rs. 1,014 Crore (US$ 206.9 Million) up marginally from the same period a year earlier.
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ICICI Bank Becoming More Selective with New Credit Card Customers
ICICI Bank India’s second largest bank and the country’s largest credit card issuer has decided to ease up on the growth of its credit card business following in the same footsteps of Standard Chartered Bank as was reported here a couple of weeks ago. In fact seeking better quality clients that are more likely to repay their obligations has been a long running theme within Indian retail banking over the last few months, as the rush to grab market share at any cost including compromising on credit quality has clearly not paid off.
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ICICI Bank a Great Buy Right Now
Even before rumour mongering took hold of the Indian equity markets at the beginning of October, ICICI Bank, India’s largest private sector lender had already taken a beating, down some 56% from the start of the year when the Sensex hit its all time highs. Rumours of ICICI Bank’s exposure to Lehman Brothers and the questioning of its financial health began circulating through anonymous emails and text messages. That was enough to prompt a run on a few of the bank’s branches in the southern city of Hyderabad.
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Indian Public Sector Banks Seek Expansion
Allahabad Bank one of India’s nationalised banks has ambitions growth plans this fiscal year and is targeting 20% growth in its total loan portfolio, and 17% growth in deposits. A company spokesperson said that loan growth would be targeted towards small and medium enterprises, steel and cement companies as well as loans being made to commercial property developers. >> Read more
ICICI Bank Issues Clarification They are Financially Sound
The Indian banking sector has remained relatively insulated from the global credit crisis and has seen mark-to-market losses of around Rs 400 Crore or US$100 Million due to investments in instruments of troubled US financial giants Lehman Brothers, AIG, Washington Mutual or Wachovia. About 75 per cent of this is borne by ICICI Bank alone. ICICI Bank has an estimated Mark to Market loss of Rs 309 crore or about a US$70 Million loss, according to a senior Finance Ministry official.
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