ICICI Bank Q1 profit jumps 16% as margins widen
India's ICICI Bank posted a 16% rise in first-quarter profit, driven by expanding net interest margins and robust fee income, signaling sustained operational momentum in one of the country's largest private lenders.
ICICI Bank reported a first-quarter profit of Rs 14,805 crore, a 16% increase from the same period last year. On a consolidated basis, profit after tax reached Rs 15,440 crore, up from Rs 13,558 crore a year earlier. The earnings growth was underpinned by a steady expansion in the lender's net interest margin to 4.36%, up from 4.34% a year ago and 4.32% in the preceding March quarter.
The lender's core operating profit grew 15.6% year-on-year to Rs 20,235 crore. Stripping out dividends received from subsidiaries reveals a more robust 18.3% growth rate, bringing adjusted core operating profit to Rs 19,125 crore. This underlying momentum is a critical metric for market analysts assessing the bank's standalone earning power independent of its subsidiaries.
A primary driver of this performance was a 23.5% surge in fee income to Rs 7,286 crore. For investors, this signals a successful pivot toward high-yield, non-interest revenue streams. Retail, rural, and business-banking customers drove this growth, contributing roughly 72% of total fees, a dynamic that mitigates reliance on volatile corporate lending cycles.
While fee growth was strong, non-interest income excluding treasury operations rose 16% to Rs 8,425 crore. This metric effectively insulated the bank's bottom line from a severe drop in treasury gains, which plummeted to Rs 151 crore from Rs 1,241 crore in the year-ago quarter.
Credit quality trends provide further reassurance to the market. Provisions excluding tax declined to Rs 1,260 crore from Rs 1,815 crore, directly boosting the bottom line. Gross non-performing asset additions slowed to Rs 5,552 crore, down from Rs 6,245 crore a year earlier. The bank managed these balances through Rs 2,845 crore in recoveries and upgrades, alongside Rs 1,673 crore in gross NPA write-offs.
The balance sheet remains heavily fortified against potential macroeconomic shocks. ICICI Bank closed the quarter with a total capital adequacy ratio of 16.84% and a common equity Tier-1 ratio of 16.19%. Simultaneously, the lender continues to build out its physical distribution network, adding 97 branches in the quarter to reach a total of 7,608 branches and 12,190 ATMs and cash recycling machines.
