ICICI Bank Ltd., India’s second-largest private sector lender, posted a stronger-than-expected profit for the September quarter, buoyed by robust loan growth and improving asset quality.
The Mumbai-based bank’s performance highlights continued resilience amid evolving market conditions and healthy retail demand.
Profit beats street estimates on steady loan expansion
ICICI Bank’s standalone net profit rose 5.2% year-on-year to ₹12,358.9 crore ($1.4 billion) for the quarter ended September, comfortably exceeding analyst expectations.
A Bloomberg survey had projected a profit of ₹12,067 crore, while a Moneycontrol poll estimated a more modest 2.3% growth to ₹12,024 crore.
The bank’s loan portfolio grew 10.6% year-on-year, supported by strong retail demand and continued credit expansion across key segments.
Total income for the quarter increased to ₹49,333.5 crore from ₹47,714 crore a year ago, while other income rose to ₹7,575.5 crore from ₹7,176.7 crore, underscoring the diversified revenue streams of the lender.
Net interest income (NII)—the difference between interest earned on loans and interest paid on deposits—rose 7.4% year-on-year to ₹21,529.5 crore, slightly surpassing the Street’s projection of ₹21,486 crore.
The increase in NII reflects both higher lending volumes and effective management of funding costs, even as margins remain competitive.
Asset quality improves, provisions decline
ICICI Bank continued to demonstrate strong credit discipline, with gross non-performing assets (GNPA) declining to ₹23,849.7 crore, down from ₹27,121.2 crore a year earlier.
The GNPA ratio improved to 1.58%, compared with 1.97% in Q2 FY25, while the net NPA ratio eased to 0.39% from 0.42% the previous year.
Net NPAs for the quarter stood at ₹5,827 crore, marginally higher than ₹5,685 crore in Q2 FY25.
Provisions and contingencies for the quarter fell nearly 26% to ₹914 crore, reflecting the bank’s improving credit profile and lower asset quality pressures.
During the quarter, average deposits increased 9.1% year-on-year and 1.6% sequentially to ₹15,57,449 crore, driven by growth in both current and savings accounts.
Average current account deposits rose 12.6%, while savings account deposits grew 8.5% year-on-year.
The bank’s CASA ratio stood at 39.2% in Q2 FY26.
The capital adequacy ratio under Basel III improved to 15.76%, up from 15.35% a year ago, highlighting a strengthened balance sheet.
ICICI Bank’s return on assets (annualised) remained stable at 2.36%, compared with 2.40% in the prior year, while net worth increased to ₹3,01,628 crore from ₹2,50,418 crore, reflecting ongoing capital accumulation and retained earnings growth.
Outlook supported by retail lending and robust balance sheet
The bank’s results underscore the resilience of India’s private sector lenders amid macroeconomic and competitive challenges.
Healthy growth in retail and small- to mid-sized enterprise loans, combined with disciplined credit risk management, has allowed ICICI Bank to expand its loan book without materially compromising asset quality.
With net interest income and other income continuing to show steady growth, coupled with declining NPAs and robust capital adequacy, ICICI Bank remains well-positioned to capitalize on expanding credit demand in the Indian market.
ICICI Bank’s shares have surged over 11% in the year so far.
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