ICICI Bank Limited
IBN · NYSE
Dec 2026
Next quarter
Expected to report Jan 18, 2027 — estimated from last year’s reporting date.
Consensus is $0.43 EPS for Dec 2026 across 2 estimates, ranging $0.42 to $0.44.
IBN Sep 2026
- 22.50%
- -1.70%
- $0.40
- $0.49
- —
- —
Highlights
- Earnings beat: Reported EPS of $0.49 exceeded the $0.40 consensus by 22.5%. Profit after tax rose 20.1% year over year to INR 148.43 billion; profit before tax excluding treasury increased 23.4% to INR 199.54 billion.
- Balance-sheet growth: Loans grew 30% year over year and 12% sequentially including international-branch lending against FCNR(B) deposits; excluding those loans, growth was 24.1% and 7.3%. Deposits rose 27.1% year over year, or 17% excluding FCNR(B) deposits.
- FCNR(B) funding: The bank mobilized about $18 billion in gross FCNR(B) deposits, supporting lending and customer engagement but contributing to a larger overseas loan-book mix and near-term margin pressure.
- Margins moderated: Net interest margin was 4.18%, down from 4.36% in the prior quarter and 4.30% a year ago. Management expects further moderation in Q3 as the funding and asset-mix effects annualize, followed by a recovery from Q4.
- Asset quality improved: Net NPA ratio fell to 0.30% from 0.35% in June and 0.39% a year earlier. Net additions to gross NPAs were INR 12.13 billion, down from INR 13.86 billion a year ago.
- Operating income strengthened: Net interest income rose 17.7% year over year to INR 253.39 billion. Non-treasury fees increased 20.1% to INR 77.95 billion, while operating expenses rose 8.5%.
- Capital and buffers: CET1 stood at 16.01% and total capital adequacy at 16.68%. The bank held INR 131 billion of contingency provisions, about 0.7% of advances.
Analysis
ICICI Bank delivered a strong Q2 FY27 earnings beat: EPS of $0.49 was 22.5% above the $0.40 consensus, while net profit rose 20.1% year over year to INR 148.43 billion. Core operating profit increased 21.8% to INR 208.05 billion, and profit before tax excluding treasury grew 23.4% to INR 199.54 billion. Net interest income rose 17.7% year over year and 3.9% sequentially to INR 253.39 billion. The transcript does not provide a sequential net-profit comparison.
The quarter was defined by rapid balance-sheet expansion, largely supported by an exceptional FCNR(B) deposit mobilization of about $18 billion, alongside a temporary squeeze in reported margin. Loans grew 30% year over year including international lending against those deposits, and 24.1% excluding it; deposits grew 27.1%, or 17% excluding FCNR(B). NIM declined to 4.18% from 4.36% in the prior quarter and 4.30% a year earlier. Management expects the full impact of the funding and overseas-book mix in Q3, with margins starting to recover in Q4. Credit quality improved: net NPA fell to 0.30%, and net additions to gross NPAs were lower than a year ago. The bank maintained substantial contingency provisions and strong capital ratios.
Earnings and income
- Profit growth: Profit after tax increased 20.1% year over year to INR 148.43 billion; consolidated profit after tax rose 22.3% to INR 163.33 billion.
- Core performance: Core operating profit grew 21.8% to INR 208.05 billion. Excluding dividend income from subsidiaries, it increased 25% to INR 203.42 billion.
- Interest and fees: Net interest income rose 17.7% year over year and 3.9% sequentially to INR 253.39 billion. Non-interest income excluding treasury increased 12.5% to INR 82.77 billion, including fee income growth of 20.1% to INR 77.95 billion.
- Costs and treasury: Operating expenses rose 8.5% year over year, with employee expenses up 13.5% and non-employee expenses up 5.6%. Treasury recorded a INR 2.3 billion loss, versus a INR 2.2 billion gain a year ago.
FCNR funding and growth
- Funding raised: Gross FCNR(B) deposits mobilized were about $18 billion. Management said roughly $10 billion was associated with loans provided to customers, about $3.6 billion with loans from partner banks, and more than $4 billion with customers’ own funds.
- Deposit base: Period-end deposits grew 27.1% year over year and 11.8% sequentially; excluding FCNR(B), growth was 17% and 3.1%. Average deposits rose 21.2% year over year and 8% sequentially. Average CASA deposits increased 10.7% year over year.
- Loan growth: Total loans grew 30% year over year and 12% sequentially; excluding international-branch loans against FCNR(B) deposits, growth was 24.1% and 7.3%. Domestic loans grew 22.8% year over year.
- Portfolio mix: Business banking grew 33.8% year over year and domestic corporate lending 30.6%, while retail and rural lending rose 14.8%. Retail and rural loans, including non-fund-based exposure, represented 43% of the total portfolio.
- Management view: Executives attributed corporate growth to customer demand, working-capital needs, investment activity and shifts from bond and foreign-currency markets, rather than temporary parking of FCNR funds. They expect excess liquidity to be deployed over the next two quarters.
Margin outlook
- Reported NIM: Net interest margin was 4.18%, versus 4.36% in Q1 FY27 and 4.30% in Q2 FY26. The prior-quarter figure included interest on a tax refund; excluding that benefit, prior-quarter NIM was 4.28%.
- Domestic margin: Domestic NIM excluding the prior-quarter tax-refund benefit was 4.32%, compared with 4.36% in Q1 and 4.37% a year earlier. Cost of deposits rose to 4.50% from 4.41% in Q1.
- Drivers and timing: A greater share of overseas assets, which earn lower margins than domestic assets, and rapid growth in term deposits weighed on the blended margin. Management expects these effects to be fully reflected in Q3 averages, with margins beginning to recover from Q4, even without further rate hikes.
Credit quality and buffers
- NPA movement: Net NPA ratio improved to 0.30% at September 30 from 0.35% at June 30 and 0.39% a year earlier. Gross NPA additions were INR 48.33 billion; recoveries and upgrades were INR 36.20 billion, leaving INR 12.13 billion of net additions before write-offs and sales.
- Retail and corporate trends: Retail and rural net NPA additions fell to INR 11.05 billion from INR 14.39 billion a year earlier. Corporate and business banking recorded INR 1.08 billion of net additions, versus net deletions of INR 0.53 billion in the prior-year quarter.
- Provisions: Total quarterly provisions were INR 8.51 billion, 4.1% of core operating profit, versus INR 9.14 billion a year ago. Management estimated normalized credit cost at about 50 basis points after adjustments for one-off recoveries, FCNR-related standard provisions and seasonal KCC provisioning.
- Reserves: Contingency provisions were INR 131 billion, about 0.7% of advances. The bank also retained INR 12.83 billion of additional agricultural priority-sector standard provisions pending completion of a regulatory review.
Capital and subsidiaries
- Capital: CET1 was 16.01% and total capital adequacy was 16.68% at September 30, 2026. The bank acquired an additional 2% stake in ICICI Life for INR 14.7 billion during the quarter.
- Insurance businesses: ICICI Life’s H1 value of new business rose to INR 12.83 billion from INR 10.49 billion a year earlier, and its margin was 26%. ICICI General’s Q2 profit increased to INR 9.46 billion from INR 8.2 billion, while its combined ratio rose to 107% from 105.1%.
- Other subsidiaries: ICICI AMC reported quarterly profit of INR 8.89 billion, up from INR 8.38 billion a year earlier; ICICI Securities’ consolidated profit increased to INR 4.39 billion from INR 4.25 billion.
