Notes to accounts final

NOTES TO ACCOUNTS

October 9, 2015

Apurva Gautam (409)

Charanpreet Singh(424)

Nitin Joshi (452)

Sandeep Sharma (467)

Shashank Shekhar (473)

Nidhi Dwivedi (448)

S Laxmipathi (464)

Venkata Chaitanya (486)

Vineeta Chauhan (488)

Vipul Bhatia (494)

Presented By Group 5 and 6

2

Agenda

EPS

Business/Information ratios

Information about Business and Geographical

segments

Capital adequacy ratio

Maturity pattern

Liquidity coverage ratio

3

Agenda

Preference shares

Employee Stock Option Scheme (ESOS)

Investment and CBLO transactions

Subordinated Debt

NPA and Provisions

Asset Health Management

4

Agenda

Concentration

Provisions and Contingencies

Priority and Non-Priority sector lending

Exposure to sensitive sectors

Risk Category-wise country exposure

Bancassurance

5

Agenda

Provision for Income Tax

Deferred Tax

Penalties/Fines Imposed

Other Notes

6

Agenda

EPS



segments


Maturity pattern


Earnings per Share: EPS

7

2013 2014 2015

Basic

No. of Outstanding

Shares

1,153,066,422 1,154,317,577 5,785,726,485

Basic earnings per

share 72.2 84.99 19.32

Diluted

No. of Outstanding

Shares

1,157,455,610 1,158,893,790 5,842,092,456

Diluted earnings per

share

71.93 84.65 19.13

8

Agenda

EPS



segments


Maturity pattern


Business / Information ratios

9

2013 2014 2015

Interest income

to working funds 8.17% 8.00% 8.19%

Non-interest

income to

working funds 1.70% 1.89% 2.03%

Operating profit

to working funds 2.69% 3.00% 3.29%

Return on assets 1.70% 1.78% 1.86%

Net profit per

employee 1.4 1.4 1.6

Business per

employee 73.5 74.7 83.2

10

Agenda

EPS



segments


Maturity pattern


Capital Adequacy ratio

11

Basel III requires Bank to maintain a minimum

capital to risk-weighted assets ratio (CRAR) of

9.0% with minimum CET1 CRAR of 5.5% and

minimum Tier-1 CRAR of 7.0%.

The following table sets forth computation of

capital adequacy as per Basel III framework.

12

Agenda

EPS



segments


Maturity pattern


Liquidity Coverage ratio

BCBS had proposed LCR in order to ensure that a

bank has an adequate stock of unencumbered

HQLA to survive a significant liquidity stress

lasting for a period of 30 days. LCR is defined as

a ratio of HQLA to the total net cash outflows

estimated for the next 30 calendar days.

The Bank during the three months ended March

31, 2015 maintained average HQLA (after haircut)

of Rs. 569,153.4 million against the average

liquidity requirement of Rs. 336,609.6 million at

minimum LCR requirement of 60%.

13

14

Agenda

EPS



segments


Maturity pattern


Information about Business and

Geographical segments Reported business – Retail, Wholesale, Treasury

and other banking

Geographical segments

Domestic operations -comprise branches in India.

Foreign operations -comprise branches outside India and

offshore banking unit in India.

Data from Annual report of year ending 2015 and 2014

16

Agenda

EPS



segments


Maturity pattern


Maturity Pattern of Assets &

Liabilities Mismatch in the maturity patterns of assets and

liabilities- may result in liquidity risk

As per RBI guidelines, commercial banks are to

distribute the outflows/inflows in different residual

maturity period known as time buckets.

The net cumulative negative mismatches during

the Next day, 2-7 days, 8-14 days and 15-28 days

buckets should not exceed 5 %, 10%, 15 % & 20 %

of the cumulative cash outflows in the respective

time buckets in order to recognize the cumulative

impact on liquidity.


Liabilities (contd.)

Data from Annual report of year ending 2015


Liabilities(contd.) In case of negative mismatch to satisfy funding

needs a bank should

Dispose of liquid assets

Increase short term borrowings

Decrease the holding of less liquid assets

Increase capital funds

In case of positive mismatch

Excess liquidity can be deployed in money market

instruments, creating new assets and invest in

SWAPs.

20

Agenda

Preference shares



Subordinated Debt

NPA and Provisions


Preference Shares

Govt. securities amounting to Rs 3,088.6 mn at

March 31, 2015 have been earmarked against

redemption of preference shares issued by the

Bank, which fall due for redemption on April 20,

2018, as per the original terms of the issue.

March 31, 2014: Rs. 2,970.9 million

March 31, 2013: Rs. 2,749.9 million

22

Agenda

Preference shares



Subordinated Debt

NPA and Provisions



Maximum number of options granted to any

eligible employee in a financial year shall not

exceed 0.05% of the issued equity shares of the

Bank at the time of grant of the options

Options vest in a graded manner over a four-year

period, with 20%, 20%, 30% and 30% of the grants

vesting in each year, commencing from the end of

12 months from the date of grant.


Once employees exercise their options, the

company is allowed to take a tax deduction equal

to the difference between the strike price and the

market price as compensation expense.

25

Agenda

Preference shares



Subordinated Debt

NPA and Provisions


Subordinated Debt

During the year 2015 and 2014 the Bank has not

raised subordinated debt qualifying for Tier-2

capital

During the year ending 2013, the Bank raised

subordinated debt qualifying for Tier II capital

amounting to Rs. 38,000 mn.

Increase in branch network and technology

initiatives.

Used for growth capital, acquisitions or leveraged

buyouts

27

Agenda

Preference shares



Subordinated Debt

NPA and Provisions


InvestmentsParticulars 31.03.2015 31.03.2014

A. Investments in India (net of provisions)

Government Securities 1,056,109 951,821

Shares 23,197 24,018

Debentures and bonds 115,823 121,204

Subsidiaries and/or joint ventures 65,483 65,483

Others 526,689 533,636

Sub-total (A) 1,787,300 1,696,161

B. Investments outside India (net of provisions)

Government Securities 17,824 7,096

Subsidiaries/ joint ventures abroad 49,803 59,553

Equity Shares, Bonds and Certificate of Deposits 10,873 7,408

Sub-total (B) 78,500 74,057

Total Investments (A+B) 1,865,800 1,770,218

28

SLR Investments Non-SLR Investments

In Rs. Million

Non-SLR InvestmentsParticulars 31.03.2015 31.03.2014

Issuer

PSUs 16,011.7 27,510.9

FIs 37,028.6 25,421.2

Banks 121,737.0 139,816.8

Private Corporates 97,754.7 107,977.7

Subsidiaries 117,751.2 127,746.7

Others 427,259.2 405,366.0

Provision held towards depreciation (25,674.7) (22,537.6)

Total 791,867.7 811,301.7

29

In Rs. Million

HTM Securities

30

Held to Maturity (HTM) Securities

A held to maturity security is a debt or equity

security that is purchased with the intention of

holding the investment to maturity.

Sales and Transfers of Securities to/from HTM

Category

During FY2015, the value of sales and transfers of

securities from HTM category exceeded 5% of the

book value of the investments held in HTM

category at the beginning of the year

At the end of the year, outstanding balance, market

value of investments held in the HTM category was

Rs. 1,271,386.6 million

CBLO Transactions

31

Collateralised Borrowing and Lending Obligation

(CBLO) is a discounted money market

instrument, established by The Clearing

Corporation of India Limited (CCIL) and approved

by RBI, which involves secured borrowings and

lending transactions.

Particulars 31.03.2015 31.03.2014

O/S Borrowing under CBLO - 11,496.9

O/S Lending under CBLO - -

In Rs. Million

32

Agenda

Preference shares



Subordinated Debt

NPA and Provisions


NPA and Provisions

Derivatives

Exchange Traded Interest rate derivatives and

Currency Options

Forward rate agreement (FRA)/ Interest rate swaps

(IRS)

Non – Performing Assets

Provision on standard assets

Rs3847.9 million & Rs 2487.7 million in FY2015 &

FY2014

Incremental provision towards UFCE – Rs1750.0

million

Provision Coverage ratio – 58.6% (FY2015) &

68.6%(FY2014)

33

Derivatives

Net Loss for FY2015 & FY2014 is Rs22.0 million

Rupee denominated derivative are marked to

market with internal models

Net Overnight Open Position at March 31,2015 is

Rs1193.1 million (133%)

Bank as nil exposure on credit derivative

instruments

Deposits with structured returns linked to interest,

forex, credit or equity bench marks

Net open notional position – nil for FY2015 &

FY2014

Net Gain – Rs1.4 million & Rs 6.2 million in FY2015

& FY2014

34


35


Loan Concentration

Retail Finance – 40.8% & 43.5%

Asset Heavy and systematic problems – 33.8 % &

32.7%

36


37

38

Agenda

Preference shares



Subordinated Debt

NPA and Provisions


Asset Health management

Securitisation

The Bank has not securitised any loans as an

originator during FY 2015

Net gain on securitisation Rs. 148 million

Financial assets transferred to Securitisation

Company and Reconstruction Company

39

Asset Health management

NPA’s purchased/sold excluding those sold to

SC/RC

Sale of NPA

40

Asset Restructuring

41

42

Agenda

Concentration





Bancassurance

43

Agenda


Deferred Tax


Other Notes

44

Agenda

Concentration





Bancassurance

Concentration

45

At March 31, 2015 At March 31, 2014

Concentration of deposits

Total deposits of 20 largest depositors 232,603.9 242,537.6

As a percentage of total deposits 6.43% 7.31%

Concentration of advance

Total advances to 20 largest borrowers 1,337,961.7 1,154,740.4

As a percentage of total advances 16.58% 15.73%

Concentration of exposure

Total exposure to 20 largest borrowers/customers 1,354,445.8 1,190,611.6

As a percentage of total exposure 15.87% 15.21%

Concentration to NPA

Total exposure to top four NPA accounts 62,016.3 17,486.9

46

Agenda

Concentration





Bancassurance

Provisions and contingencies

47

Particulars At March 31, 2015 At March 31, 2014

Provisions for depreciation of investments 2979.2 711.2

Provision towards non-performing and other assets1

31412.7 22522.7

Provision towards income tax

Current 48591.4 38395.0

Deferred (2195.7) 3131.9

Provision towards wealth tax 50.0 50.0

Other provisions and contingencies2 4607.9 3030.2

Total provisions and contingencies 85445.5 67841.0

48

Agenda

Concentration





Bancassurance

Priority sector

Sector Wise Advances (in million INR)

Sr.No. SectorOutstanding advances(31st mar 2015)

Gross NPA(31st mar 2015)

% of Gross NPA to Total advances in that sector (31st mar 2015)


A PRIORITY SECTOR

1 Agriculture and allied activities 2,37,737.60 7,051.40 2.97% 3.62%

2Advances to industries sector eligible as priority sector lending 1,14,316.80 3,660.30 3.20% 3.40%

3 Services, of which: 1,18,499.00 1,963.10 1.66% 1.35%

Transport operators 61,484.70 1,273.50 2.07% 1.47%

Wholesale trade 14,487.10 487.70 3.37% -

4 Personal loans, of which: 3,01,750.10 3,818.10 1.27% 1.28%

Housing 2,17,485.40 2,571.40 1.18% 1.35%

Vehicle Loan 78,868.50 967.20 1.23% 1.06%

Sub-total (A) 7,72,303.50 16,492.90 2.14% 2.29%

49

Priority sector

50

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

Agriculture and allied activities Industrial sector eligible aspriority sector

Services Personal Loan

Outstanding advance (INR million)

As at 31st March 2015 Outstanding advance As at 31st March 2014 Outstanding advance

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

Agriculture and allied activities Industrial sector eligible aspriority sector

Services Personal Loan

NPA (%)

As at 31st March 2015 Outstanding advance As at 31st March 2015 Gross NPA

Non – Priority sector

51

Sector Wise Advances (in million INR)

Sr.No. SectorOutstanding advances(31st mar 2015)

Gross NPA(31st mar 2015)



B NON PRIORITY SECTOR

1 Agriculture and allied activities NIL NIL NIL NIL

2 Advances to industries sector, of which: 15,32,182.60 73,115.30 4.77% 3.01%

Infrastructure 4,92,067.90 17,174.30 3.49% 1.71%

Basic metal and metal products 3,11,448.40 11,462.20 3.68% 1.26%

3 Services, of which: 8,51,479.80 50,175.60 5.89% 3.80%

Commercial real estate 2,64,316.40 4,914.10 1.86% 2.10%

Wholesale trade 1,28,156.70 4,299.10 3.35% 4.88%

4 Personal loans of which: 8,33,654.30 11,163.10 1.34% 2.97%

Housing 5,75,848.80 3,488.50 0.61% 0.76%

Sub-total (B) 32,17,316.70 1,34,454.00 4.18% 3.20%

Total(A+B) 39,89,620.30 1,50,946.90 3.78% 3.03%

Non – Priority sector

52

0

500,000

1,000,000

1,500,000

2,000,000

Industrial sector Services Personal Loan

Outstanding Advances (INR million)

As at 31st March 2015 Outstanding advance As at 31st March 2014 Outstanding advance

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

Industrial sector Services Personal Loan

NPA (%)

Mar-15 Gross NPA Mar-14 Gross NPA

53

Agenda

Concentration





Bancassurance


54

Mar-15 Mar-14 Mar-13

Exposure to real estate 1,426,398.30 1,163,907.70 964,312.80

0

500,000

1,000,000

1,500,000

Exposure to real estate


Exposure to capital market 182,780.70 172,736.90 192,454.40

160,000

165,000

170,000

175,000

180,000

185,000

190,000

195,000

Exposure to capital market

INR Million

INR Million


55

88.6%

87.1%

83.4%

80%

81%

82%

83%

84%

85%

86%

87%

88%

89%

90%

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000


Exposure to capital market Exposure to real estate % real estate

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000


Comparison with SBI

Exposure CM - SBI Exposure CM - ICICI Exposure Real estate - SBI Exposure Real estate - ICICI

INR Million

INR Million


Type CAGR

Exposure CM - SBI 37%

Exposure CM - ICICI -3%

Exposure Real estate - SBI 10%

Exposure Real estate - ICICI 22%

56

-10%

0%

10%

20%

30%

40%

Exposure CAGR

Exposure CM - SBI Exposure CM - ICICI Exposure Real estate - SBI Exposure Real estate - ICICI

57

Agenda

Concentration





Bancassurance

Risk category-wise country exposure

Funded country exposure (net) of the Bank as a

percentage of total funded assets:

No exposure in moderately high, high and very

high category

Provisions held only because the net exposure

for these countries exceeded 1.0% of total funded

assets (RBI guidelines)

58

Country At March 2015 At March 2014

Singapore 1.31% 1.45%

USA 2.53% 0.83%

Provision kept 345.0 mn 135.0 mn

59

Agenda

Concentration





Bancassurance

Bancassurance

60

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

March 31, 2015 March 31, 2014 March 31, 2013

Income (Rs. Million)

Life insurance policies

Non-life insurance policies

Mutual fund/collectiveinvestment scheme products

141% rise in income from Mutual fund products

since FY 2013

67% rise in income from Insurance policies since

FY 2013

45% rise in income from Non- Insurance policies

since FY 2013

61

Agenda


Deferred Tax


Other Notes

Provision for income tax

ICICI Bank has a comprehensive system of

maintenance of information and documents

As per transfer pricing legislation of IT Act

all transactions with international related parties

and specified transactions with domestic related

parties are primarily at arm’s length

IT legislation does not have material impact on

the financial statements.

62

Rs. Million

At March 31,

2015

At March 31,

2014

At March 31,

2013

Provision for income tax 46395.7 41526.7 30642.2

63

Agenda


Deferred Tax


Other Notes

Deferred Tax

64

Rs Million

At March 31, 2015 At March 31, 2014

Deferred tax asset

Provision for bad and doubtful debts 37860.0 26621.5

Capital loss 50.50 49.60

Others 3,118.10 2,204.80

Total deferred tax asset 41,028.60 29,875.90

Deferred tax liability

Special reserve deduction 21,273.00 17,234.90

Depreciation on fixed assets 5,270.70 5,172.30

Others 4.90 -

Total deferred tax liability 26,548.60 22,407.30

Total net deferred tax asset/(liability) 14,480.00 7,468.60

65

Agenda


Deferred Tax


Other Notes

Penalties/Fines imposed

Penalty by RBI – Rs. 10.4 million for FY 2015

Rs. 5.0 million for Non-compliance with (KYC)/

(AML). The Bank has paid the penalty to RBI

Rs. 4.0 million for flouting banking norms while

doing business with Deccan Chronicle Holdings

Ltd

A penalty of Rs. 1.4 million was imposed on the

Bank in February 2015 by the FIU India and the

case is underway

66

67

Agenda


Deferred Tax


Other Notes

Other notes

March 31,

2015

March 31,

2014

March 31,

2013

Pending at the beginning

of the year 3,324 4,586 3837

Received during the year 2,01,676 2,18,839 101408

Redressed during the

year 2,02,113 2,20,101 102617

Pending at the end of the

year 2,887 3,324 2628

68

Complaints

FITL

For cases prior to 2008 guideline which have not been

repaid

With the approval of the RBI ICICI Bank debited its

reserves by Rs. 9,291.6 million

Unsecured advances against intangible assets

March 15, 14, 13 – NILL

69

Thank you

Notes to accounts final

Economy & Finance