Icici Bank Project

STUDY OF NON-PERFORMING ASSETS OF PRIVATE SECTOR BANKS WITH REFERENCE TO ICICI BANK
CHAPTER-1
INTRODUCTION
SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 1

STUDY OF NON-PERFORMING ASSETS OF PRIVATE SECTOR BANKS WITH REFERENCE TO ICICI
BANK
INTRODUCTION
The Non-Performing Asset (NPA) analysis of ICICI Bank serves as a

comprehensive investigation into the financial health of one of India's
leading financial institutions. Non-Performing Assets are a critical metric in
assessing a bank's stability and its ability to manage credit risk effectively.
This project aims to delve into the key aspects of ICICIBank's NPA portfolio,
exploring the factors contributing to NPAs, their impact on the bank's overall
performance, and potential strategies for mitigation.
.Non Performing Assets have been a major stumbling block hindering the gain of
Indian business
and personal banks before 1992, the banks failed to disclose the unhealthy debts
sustained or with command by them Associate in Nursing the provision created for
identical fearing that it's going to have an adverse result. due to the low levels of
gain, banks closely-held funds had to be reinforced and authorized by continual
infusion of extra capital by the state additionally because the central government.
The introduction of prudent norms and rules strengthen the banks monetary
position and enhance transparency is taken into account as a milestone live within
the monetary sector reforms. Such prudent norms relate to financial gain
recognition, plus classification, provisioning for unhealthy and uncertain debts and
capital adequacy. Associate in Nursing searching & Descriptive study was adopted
to attain the objectives of the study, and also the study was conducted in ICICI
Bank, Indiranagar, Bangalore for "Non performing Assets". The overall objective
of the study was to investigate the NPA level in ICICI Bank with comparison to
different monetary establishments.
The major limitations of the study was moving into in depth info with the director
additionally because the officers oftentimes and conjointly gathering the thorough
monetary knowledge needed for the calculations. Inspite most effort has been place
to hit a most applicable conclusion. the strategy adopted for assortment of
information was personal interview with most of the bank officers & records of
previous years, it absolutely was conjointly sourced from the secondary knowledge
for a more robust conclusion when aggregation knowledge from the several sources,

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analysis & interpretation of information has been created. On analyzing all the
information, the findings were as follows:-
Workers square measure being increasing however there's no result on the

recovery created All the findings, logical conclusions square measure drawn and
additional, appropriate suggestions& recommendations square measure arrived, the
whole project report is given within the style of a report mistreatment chapter
schemes provided by the faculty authorities, developed logically and consecutive
from govt outline to listing.
Always a robust banking industry is vital for flourishing economy thanks to varied
reasons. one among the foremost necessary and major roles contend by banking
sector is that of disposal business.
It's typically inspired as a result of it's the result of funds being transferred
from the system to productive functions, that co-jointly results into economic
process. As there square measure blessings and drawbacks of everything, identical
is with disposal businesses that carries credit risk continuously, that arises from the
failure of receiver to fulfil his a part of written agreement obligations either
throughout the course of a group action or on a future obligation. The failure ofthe
banking sector could have a adverse impact on different sectors additionally.
Non performing arts assets square measure one amongst of the main
considerations for banks in Asian country every currently and so. Non performing
arts assets replicate the performance of banks. A high level of Non performing arts
plus recommend high likelihood of an outsized range ofcredit defaults that have an
effect on the gain and web value of banks and conjointly reduces the worth of the
asset. The non performing arts assets growth involves the requirement of provisions,
that reduces the profits and shareholders price. The difficulty of Non performing
arts Assets has been mentioned at length for financial set-up everywhere the globe.
The matter of NPAs isn't solely touching the banks however conjointly the
entire economy. Indeed high level of NPAs in Indian banks is nothing however a
mirrored image of the state of health of thetrade and trade. This project deals with
understanding the thought of NPAs, its magnitude Associate in Nursing major
causes for an account turning into non-performing, projection of NPAs over next
years in banks and terminal remarks. The magnitude of NPAs have an immediate
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impact on Banks gain lawfully (they square measure they're) not allowed to book
financial gain on such accounts and at identical time banks are forced to create
provisions on such assets as per run pointers. These are amended variety of times
since1997.
As per their pointers the that means of NPAs, the norms concerning assets
classification and provisioning Its currently terribly acknowledged that the banks
and monetary establishments in Asian country face the matter of amplification of
non-performing assets (NPAs) and also the issue is turning into additional and
additional unmanageable. So as to bring things in check, varied steps are taken.
Among different steps most vital one was the introduction of securitization and
construction of economic Assets and social control of interest Act, that was a
crucial step towards elimination and reduction of NPAs.
Associate in Nursing plus is assessed as non-performing plus (NPAs) if dues
within the style ofprincipal and interest aren't paid by the receiver or borrowers for
a amount of a hundred and eighty days but with result from March 2004, default
standing would incline to a receiver if dues aren't purchased ninety days.
If any advance or credit facility granted by bank to a receiver becomes non-

performing, then the bank can have to be compelled to treat all the advances/credit
facilities granted to it receiver as non- performing while not having any relevancy
the actual fact that there should still exist sure advances/credit facilities having
performing arts standing. The NPA level of ourbanks is far high than international
standards. Indian banks ought to lookout to make sure credit worthy customers,
this context "prevention is usually higher than cure" acts because thegolden rule to
scale back the amount of non performing assets.

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NEED OF THE STUDY
This report explores an empirical approach to the analysis of Non-Performing

Assets (NPAs) with special reference of ICICI bank in India. The NPAs are
considered as an important parameter to judge the performance and financial health
of banks. The level of NPAs is one of the drivers of financial stability and growth
of the banking sector. This report aims to find the fundamental factors which
impact NPAs of banks. A model consisting of two types of factors, viz.,
macroeconomic factors and bank-specific parameters, is developed and the
behavior of NPAs of the three categories of banks is observed. The empirical
analysis assesses how macroeconomic factors and bank-specific parameters affect
NPAs of a particular category of banks. The macroeconomic factors of the model
included are GDP growth rate and excise duty,and the bank-specific parameters are
Credit Deposit Ratio (CDR), loan exposure to priority sector, Capital Adequacy
Ratio (CAR), and liquidity risk. The results show that movement in NPAs over the
years can be explained well by the factors considered in the model for the public
and private sector banks. The other important results derived from the analysis
include the finding that banks' exposure to priority sector lending reduces NPAs
Objectives:
1. Evaluate the current NPA status of ICICI Bank, analyzing the composition
and trends overrecent financial periods.
2. Identify the root causes and risk factors leading to the emergence of NPAs
within the bank'sloan portfolio.
3. Assess the impact of NPAs on ICICI Bank's financial statements, capital
adequacy, andoverall profitability.
4. Compare ICICI Bank's NPA metrics with industry benchmarks and
regulatory standards togauge its relative performance.
5. Explore existing risk management practices employed by ICICI Bank and
recommendenhancements for NPA prevention and resolution.
6. Provide strategic recommendations for ICICI Bank to proactively manage
and minimize NPAlevels in the future.

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Methodology:
The study will employ a combination of quantitative and qualitative research
methods, utilizing financial reports, regulatory filings, and industry publications.
Data analysis will involve trend analysis, ratio analysis, and benchmarking against
peer institutions. Interviews with key stakeholders and experts in banking and
finance will complement the quantitative findings, providing valuable insights into
the contextual nuances of ICICI Bank's NPA landscape.
Significance:
Understanding ICICI Bank's NPA dynamics is crucial not only for

investors and regulators but also for the broader financial ecosystem. This
analysis aims to contribute valuable insights that can inform strategic decision-
making within the bank and serve as a reference for industry stakeholders
seeking a deeper understanding of NPA management strategies.
By conducting a thorough NPA analysis of ICICI Bank, this project seeks

to shed light on the bank's financial resilience, risk mitigation practices, and
future prospects in the dynamic landscape of the banking industry

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CHAPTER II
LITERATURE REVIEW

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Review of Literature
A considerable amount of research has been done in the area of Non-

performing Assets (NPAs) of commercial banks in India, by academicians and
researchers. The literature obtained by investigators, in the form of reports of
various committees, commissions and working groups established by the Union
Government, Reserve Bank of India, the research studies, articles of researchers, the
comments of economic analysts and news, is briefly reviewed in this part.
Kaveri (2001) studied the non-performing assets of various banks and suggested
various strategies to reduce the extent of NPAs Prashanth k Reddy (2002) in his
study focuses on comparative study on Non- Performing Assets in India in the Global
context.
Ramu N (2009) has made an attempt to analyze the asset quality in selected UCBs
in Tamil Nadu.The researcher also pointed out that, with the tightening of prudential
norms, the banking sector has been consistently conforming to and adopting
international prudential norms and accounting practices.
Meenakshi Rajeev and Mahesh, H.P. (2010) in their study concluded that
accounting norms have been modified substantially and mechanisms are in place for
reduction of bad debts.
Bhavani Prasad and Veera D (2011) studied NPAs in Indian Banking sector and
concluded that PSBs accounted for 78% of total NPAs and this is due to falling
revenues from traditional sources. Jaynal Ud-din Ahmed (2011) in his study
concluded that the earning capacity and profitability of banks has been adversely
affected by the high level of NPAs and the reduction of NPAs in banks is posing the
biggest challenges in the Indian economy.
Veera kumar K. (2012) in his research study concluded that the bank management
may speed up recovery of good loans and bad loans through various modes to
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decelerated growth of NPAs from the present level and also to prevent re-
emergence of NPAs over the minimum level.
Siraj.K.K and Prof.P.Sundarsanan Pillai (2012) in their research study concluded

that NPA still remains a major threat and the incremental component explained
through additions to NPA poses a great question mark on efficiency of credit risk
management of banks in India.
Zahoor Ahmed and Prof. Jagadeeshwaran. M. (2013) in their research study concluded
that NPA is a major problem and hurdle faced by banking industry. And also assessed the
various causes for accounts for becoming NPAs are wilful defaults, improper processing of
loan proposals ,poor monitoring and so on.
Prof. Ganesan. D. and Santhanakrishnan. R. (2013) have made an attempt to analyse the
sector- wise NPAs, category-wise priority sector NPAs and impact of spread on Gross and
Net NPAs. They also analysed the reasons for an assets becoming NPA and remedial measures
to be taken and concluded that due to various steps taken by the Government of India, NPAs
were reduced toconsiderable level.
In the Indian context, Rajaraman and Vasishtha (2002) in an empirical study provided an
evidence of significant bi-variate relationship between an operating inefficiency indicator and
the problem loans of private sector banks. In a similar manner, largely from lenders'
perspective, Dasand Ghosh (2003) empirically examined non-performing loans of India's
private sector banks in terms of various indicators such as asset size, credit growth and
macroeconomic condition, andoperating efficiency indicators.

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Conclusion of the Literature Review
After studying all these research papers, some major points can be concluded, like NPA
are becoming a major threat to the profitability of both Public as well as Private sector banks.
The level of NPA is more in Public sector banks than private banks and the most important
reason of high level of NPA in public sector banks is priority sector lending or directed loan
system. Besides this, various studies show that the other important reason for rising NPA
level are poor credit appraisal system and poor follow up of the borrower. And unavailability
of credit rating information about the borrower is also not available. Among the important
ways of curbing rising NPA level is that banks should have their own independent credit
agency and a proper credit appraisal of the projects should be done before granting loan to
anyone. And effective follow up should be done once the loan is granted. Changes in legal
framework as well as government policies regarding priority sectorlending needs to be changed.

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CHAPTER III
RESEARCH METHODOLOGY

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Need for study:
The banking industry has undergone a sea change after the first phase of economic
liberalization in 1991 and hence credit management (Poongavanam, 2011). A healthy banking
system is essential for any economy striving to achieve growth and remain stable in
competitive global business environment (Prasad and Veena, 2011).
A strong financial system can help achieve efficient allocation of resources across time and
space by reducing inefficiencies arising out of market frictions and other socio-economic
factors.
Amongst the various desirable characteristics of a well-functioning financial system, the
maintenance of a few non-performing assets (NPA) is an important one.
Statement of the problem:
Broadly speaking, Non-Performing Asset (NPA) is defined as an advance, where

payment of interest or repayment of installment of principal (in case of term loans disbursed by
the commercial banks) or both remains unpaid for a certain period. In India, the definition of
NPAs has changed over time. According to the Narasimhan Committee Report (1991), those
assets (advances, bills discounted, overdrafts, cash credit etc.,) for which interest remains due
for a period of 180 days should be considered as NPAs.
Subsequently, this period was reduced, and from March 1995 onwards the assets for which the
interest has remained unpaid for 90 days are considered as NPAs. Non-performing Assets
(NPA) has emerged since over a long period as an alarming threat to the Indian banking
industry.
Banking reforms by the Government of India and Reserve Bank of India (RBI) in terms
of the two Narasimhan Committee Reports have been neutralized by the ill effects of this
surging threat.
Despite various correctional steps administered to solve and end this problem, concrete
results are eluding The severity of the problem is however acutely suffered by almost all the
branches of commercial banks. Hence, the present study has focused on the trends in various
components of non-performing assets of State Bank of India and Punjab National Bank.

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Scope of the study:
As far as the scope of the study is concerned, the study covers A Comparative Analysis
of NPA Management of ICICI which are operating in the country. The period of the study is
five years spanning from 2011 to 2015
Objectives:
1. To study the impact of NPA on overall performance of selected banks.
2. To evaluate the efficiency in managing NPA between the selected banks.
3. To make suggestions for better NPA management in selected banks.
Methodology:
Methodology describes the research route to be followed, the instruments to be used,

universe and sample of the study for the data to be collected, the tools of analysis used and
pattern of deducing conclusions.
For the purpose of the study, categories of loan assets of private, private and foreign banks
which are listed in the Second Schedule of the Reserve Bank of India Act, 1939 have been
considered. The study is based on secondary data. The RBI private nations like, "Report on
Trend and Progress of Banking in India", "Annual Reports of RBI", and "Reports on Currency
and Finance" are the major sources for this study. To supplement the data, the researcher
elicits other relevant data available from the annual reports of the various private,private and
foreign commercial banks, journal, websites and text books.
The Sample:
The universe of the study consist all the private sector banks. Here, research has been done on
selected one private sector banks i.e., ICICI for this comparative study.

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Period of the study:

The study has been carried out for one year, i.e., during 2022-23. The study is based on
secondary data
Data analysis:
The analysis of the data is the core part of the research. Scientific methods have been
used nowadays to get the output or study made authentic and can also sufficed the
purpose what thestudy meant for. The collected data have been processed on computer.
To reach certain relevant results, the data collected from all resources have been tabulated,
analyzed and interpreted with the help of appropriate statistical techniques. In order to
analyze thedata and draw conclusions in this study, various statistical tools like EXCEL.
The study is confined a period of one year that is FY-2022-23.
Limitations of the study:
The present study suffered from the following limitations such as:
1) Comparison is restricted to the one bank of private sector.
2) The study is based on secondary data as published in various private instituations of

RBI and other reports. These data are based on historical accounting concept, which
ignores the impact of inflation.
The study, as limitations, is confined only to the selected and restricted indicators

CHAPTER IV
THEROTICAL BACKGROUND

Non-Performing Asset:
The Non-Performing Asset (NPA) concept is restricted to loans, advances and

investments. As long as an asset generates the income expected from it and does not
disclose any unusual risk other than normal commercial risk, it is treated as performing
asset, and when it fails to generate the expected income it becomes a "Non Performing
Asset".
In other words, a loan asset becomes a Non Performing Asset (NPA) when it ceases
to generate income, i.e. interest, fees, commission or any other dues for the bank for more
than 90 days.
A NPA is an advance where payment of interest or repayment of instalment on

principal or both remains unpaid for a period of two quarters or more and if they have
become „past due". An amount under any of the credit facilities is to be treated as past due
when it remain unpaid for 30 days beyond due date. It is also called as Non Performing
Loans.
It is made by a bank or finance company on which repayments or interest payments

are not being made on time. A loan is an asset for a bank as the interest payments and the
repayment of the principal create a stream of cash flows. It is from the interest payments
that a bank makes its profits. Banks usually treat assets as non-performing if they are not
serviced for some time.
If payments are late for a short time, a loan is classified as past due and once a
payment becomesreally late (usually 90 days), the loan is classified as non-performing (B .
Selvarajan & G. Vadivalagan, 2013). NPA usually refers to non-performing assets and the
lenders consider it as those assets that are not fetching benefits to them.
The word is not new to the bankers. It is regular but disguised loan asset. An asset
becomes nonperforming when it ceases to generate income for the bank. Prior to 31st
March, 2004 a nonperforming asset was defined as a credit facility in respect of which the
interest or instalmentof principal has remained past due for a specified period of time which
was four quarters.
Due to the improvements in payment and settlement system, recovery climate, up

gradation of technology in the banking system, etc., it has been decided to dispense with
past due concept, with effect from March 31st 2004 (Chandan Kumar Tiwari & Ravindra
Sontakke, 2013).
NPA stands for Nonperforming assets. It can be a critical issue affecting the financial
sector worldwide. As loans and advances turn sour, banks and financial institutions may
face the challenge of managing these nonperforming assets.
Understanding NPA in Indian banks can be important for investors, borrowers,
and financialinstitutions to navigate the challenges posed by these assets and work towards
a healthier and more resilient banking system. In this blog, we will dive deep into the
complexities of Non Performing Assets and understand what is NPA, NPA calculation
formula. We will also explorethe causes, impact, and measures employed to address the
Non performing asset meaning are loans or advances made by banks and financial
institutions that have stopped generating income for the lender.
In simple terms, NPA meaning in banking are those assets that are considered
nonperforming when the borrower fails to make timely payments of principal and interest for a
specified period, usually 90 days or more. NPAs indicate a higher risk of default and financial
instability.
They can include various types of loans such as personal loans, business loans, mortgages, and
credit card debt. Banks strive to minimize NPAs as they impact profitability and require
provisioning for potential losses.
Banking has various tools to measure its users’ stability, performance, and credibility. Any
slight imbalance could harm the bank’s reputation. Non-Performing Assets (NPA) are one way
to assess the strength and stability of a bank’s finances.

Some of the Non Performing Assets of bank examples are:

● Non-Performing Loans (NPLs) in bankingDefaulted mortgages
● Unpaid credit card debtOverdue business loans
● Bad debts in the corporate sector Non-performing assets in agricultural
What is NPA in Banking?

The NPA meaning in banking is any asset that fails to perform and cannot generate revenue
for the bank. Loans are assets for banks as the interest that the borrower pays to the bank
is theirsource of income. Any consumer who fails to pay the interest is categorised as “non-
performing”by the bank as they fail to meet their obligations.
Non-Performing Assets (NPA)

To regulate the norms in concurrence, banks take 90 days to identify an asset as a non-
performing asset. This asset affects the banking system. Banks run for profit, which
eventually affects the economy. Furthermore, such assets eat into the margin for banks

Non-Performing Assets (NPA) Work

When a non-payment of interest arises, the borrower is forced to liquidate any assets
pledged as a part of the debt agreement.
For example, assume a company borrows a loan of Rs 2,00,000 and makes a monthly
payment of Rs 2,000. But due to some operational failure, the company cannot process
payments, which have been due for the past 3 months. The bank will then classify this loan
as a non-performing asset. Such non-payment of the loan causes a significant burden to the
lenders.
The non-performing assets reduce the income for the banks or financial institutions
and . decreases in earnings to be disrupted. They negatively impact the balance
sheet.
Non performing assets are recorded on the balance sheet of banks and financial
institutions. When borrowers consistently fail to make loan payments, the lenders take
steps to recover the outstanding debt. If the borrower had pledged assets as collateral, the
lender may seize and sell those assets to recover the amount owed. In cases where no
collateral was pledged, the lender may classify the loan as a bad debt and sell it to a
collection agency at a discounted price.
The classification of a loan as an Non Performing Asset is typically based on the duration
of non- payment, which is commonly set at 90 days. However, this timeframe may vary
depending on the terms of the loan. It’s important to note that an NPA can be identified at
any point during the loan’s term or even at its maturity.
NPAs Classification:
NPA, it is called such as while it is an "Asset", it does not bring substantial income to its
Owner or is just dormant. Call it a white elephant if you wish. Basically, it is having
something that should work but does not (Chaudhary and Sharma, 2011).
Non-Performing Assets (NPAs) can be found in various sectors of the economy.
It is supposed to make NPAs work. The RBI has issued guidelines to banks for
classification ofassets into four categories Depending on the duration of the assets that have
remained static or have not performed for morethan 90 days, they are classified into various
categories.
1) Standard Assets:
A standard asset is a performing asset. Standard assets generate continuous income and
repayments as and when they fall due. Such assets carry a normal risk and are not NPA in
the real sense Standard asset are not consider as a NPAs but does not carry more than
normal risk attached tobusiness.
Thus in general all the current loans, agricultural and non-agricultural loans may be treated
as standard assets (Srivastava and Bansal, 2013). It requires a minimum of 25% provision
on global portfolio but not on domestic portfolio. These are loans which do not have any
problem are less risk.
2) Sub-Standard Assets:
All those assets (loans and advances) which are considered as non-performing for a period
of 12 months. These are assets which come under the category of NPA for a period of less
than 12 months (Rajput, Gupta and Chauhan, 2012).
The general provision of 10% of total outstanding principal plus entire outstanding interest
should be made on substandard assets. A NPA may be classified as sub-standard on the
basis ofthe following criteria.
An asset which has remained overdue for a period not exceeding three years in respect of
bothagricultural and non-agricultural loans should be treated as sub-standard.
In the case of all types of term loans, where installments are overdue for a period not
exceeding three years, the entire outstanding in term loan should be treated as sub-
standard.
An asset is categorized as falling below standard if it maintains its non-performing asset

(NPA)status for a period less than or equal to 12 months.

An asset, where the terms and conditions of the loans regarding payment of interest and
repayment of principal have been renegotiated or rescheduled, after commencement of
production, should be called as sub-standard and should remain at least two years of
satisfactory performance under the renegotiated terms. It means the classification of an asset
should not be upgraded merely as a result of rescheduling unless there is satisfactory
compliance with the conditions.
3) Doubtful Assets:
All those assets which are considered as non-performing for period of more than 12 months.
On these assets the banks are required to provide 100% for the unsecured portion and
additional provision of 20% to 50% advances, if doubtful for 3 and above 3 years in respect
of both agricultural and non-agricultural loans.
Rescheduling does not entitle a bank to upgrade the quality of advance automatically in the
substandard assets. A loan classified as doubtful has all the weakness inherent as that of a
substandard account. There is also a problem of weakness in the collection or liquidation
of the outstanding dues in such an account in full.
An asset is labeled as in question if it retains its non-performing asset (NPA) status for
more than12 months.
Doubtful assets: It is an asset that has remained NPA for more than 12 months.
1) Loss Assets:
All those assets which cannot be recovered. These assets are identified by the Central Bank
or by theAuditors.
Loss assets are those where loss is identified by the bank but the amount has not been
written offwholly or partly. Such loss assets will include overdue loans in cases

where decrees or execution petitions have been time barred or documents are lost which are
legalproof to claim the debt,
where the members and their sureties are declared insolvent or have died leaving no tangible
assets, where the members have left the area of operation of the society leaving no property
and their sureties have also no means to pay the dues Amounts which cannot be recovered
in case of liquidated societies.
An asset is deemed a loss asset when it becomes “uncollectible” or possesses such minimal
value that its viability as a bankable asset is not recommended. However, some recovery
value may still exist, as the asset has not been entirely written off.
Loss Asset: An asset that remains a non-performing asset for more than 3 years is a loss
asset. Thisoccurs when a bank faces total loss as it cannot recover the asset.
NPA Provisioning
Provisioning is a method that banks employ to maintain a healthy book of accounts.

Apart from technicalities, it is the primary responsibility to make adequate provisions for
any drop in the valueof loan assets. In a particular quarter, banks set aside a specific amount
of profits for non- performing assets that may turn into losses in the future. Not only is the
type of asset different, butthe provisioning also varies from bank to bank.
For example, a Tier I bank's provision norms will differ from those of a Tier II bank. The inspecting
officer of the RBI and statutory auditors make the assessment. They assist the bank's management
inmaking adequate and necessary provisions by prudential guidelines.

Provisioning norms for NPAS
After a proper classification of loan assets the banks are required to make sufficient
provision against each of the NPA account for possible loan losses as per prudential norms.
The minimum amount of provision required to be made against a loan asset is different for
different types of assets.
The details of the provisioning requirements as per the RBI guidelines are furnished below:
In terms of RBI circular No RBI/2004/254/DBOD No. BP.BC.NO 97/21.04.141/2003-04
dated 17.06.2004, the Reserve Bank of India has decided that w.e.f March31, 2005, a
general provision of 10 percent on total outstanding should be made without making any
allowance for ECGC guarantee cover and securities available.
NPAs under Substandard Assets category The 'unsecured exposures' which are identified as
'substandard' would attract additional provision of 10 percent, i.e a total of 20 percent on
theoutstanding balance. The provisioning requirement for unsecured doubtful assets is 100
percent.NPAS under Doubtful category
In terms of RBI Circular No. 2004/261/DBOD BP.BC.99/21.04.048/2003-2004 dated

21.06.2004,Reserve Bank decided to introduce graded higher provisioning according to the
age of NPAs in doubtful category for more than three years, with effect from March 31,
2005.
Consequently the increase in provisioning requirement on the secured portion would be
appliedin a phase manner over a three year period in respect of the existing stock of NPAs
as classified as 'doubtful for more three years as on March 31, 2004 as per clarification
given hereunder: In respect of all advance classified as doubtful for more than three years
on or after 1 April, 2004 the provisioning requirement would be 100 percent.
Accordingly the provisioning norm for advances identified as doubtful for more than 3 year
would be as indicated below as on March 31, 2009.
(a) Unsecured Portion The portion of the advance which is not covered by the realizable
value of the tangible security to which the bank has the valid recourse and the realizable
value is estimated on a realistic basis, provision would be to the extent of 100%.

NPA in Absolute Numbers
A higher number of NPAs indicates the dysfunctionality of loans and a decrease in the
income of the banks. Therefore, calculating absolute numbers regularly can help in
understanding the current situation of the bank. Two metrics determine the number of
NPAs.
● GNPA: GNPA stands for Gross Non-Performing Asset. This number denotes the total
value of NPA in a quarter or a financial year. It is obtained by adding all the principal
amount and interest on that amount.
● NNPA: NNPA is Net Non-Performing Asset. The provision made by the bank is
deducted from the GNPA. It is the exact value obtained after the bank has made provisions
for it.
NPA in ratio
This ratio denotes the total percentage of the unrecoverable total advances. Amounts
advanced are the total outstanding amount.
1. GNPA Ratio: It is the ratio of Gross NPA to Gross Advances

2. NNPA Ratio: It is the ratio of Net NPA to Net advances
Types of NPA
1) Gross NPA:
Gross NPAs are the sum total of all loan assets that are classified as NPAs as per RBI
Guidelines as on Balance Sheet date. Gross NPA reflects the quality of the loans made by
banks. It consists of all the nonstandard assets like as sub-standard, doubtful, and loss assets. It
can be calculated with the help of following ratio:
Gross NPAs Ratio = Gross NPAs / Gross Advances
The gross NPA ratio or GNPA ratio is calculated by dividing the total gross Non Performing
Assets by the total assets. The total gross NPAs are the total amount of loans that have been
classified as non-performing for more than 90 days. The total assets are the total value of all of
the bank’s assets, including loans, cash, and investments. The gross NPA ratio formula can be
expressed as:
Gross Non Performing Asset Ratio = Total Gross NPAs / Total Assets
Thus, a high gross NPA ratio indicates that a bank has a large number of loans that are not
being repaid. This can be a sign of financial problems for the bank
1) Net NPA:
Net NPAs are those type of NPAs in which the bank has deducted the provision regarding
NPAs. Net NPA shows the actual burden of banks. Since in India, bank balance sheets
contain a huge amount of NPAs and the process of recovery and write off of loans is very
time consuming, the banks have to make certain provisions against the NPAs according to
the central bank guidelines.It can be calculated by following:
Net NPAs Gross NPAs-Provisions/Gross Advances - Provisions
The net NPA is calculated by subtracting the value of provisions from the total gross NPAs.
Provisions are amounts that banks set aside to cover losses on NPAs. The net NPA ratio formula
can be expressed as:
Net Non Performing Asset = Total Gross NPAs – Provisions
The net NPA is a measure of the actual losses that a bank has incurred on its NPAs. A high
net NPA indicates that a bank has incurred large losses on its NPAs. This can be a sign of
financialproblems for the bank.
Examples of NPA & Gross NPA
Suppose a bank has total outstanding loans of 10,00,00,000. Among these loans,
2,00,00,000are classified as non-performing or bad loans.
Here, the bank’s Gross Non Performing Asset would be 2,00,00,000 since that is the total
valueof non-performing loans.
Now, let’s assume the bank has made provisions of 50,00,000 against the non-performing
loans.In this case, the Net NPA would be calculated by subtracting the provisions from the
Gross NPA.
Thus, the Net Non Performing Asset would be 2,00,00,000 – 50,00,000 =
1,50,00,000.NPA ratio formula
Now, to get the NPA percentage, divide the non-performing assets by total loans to get the
NPAratio in decimal form. Then multiply it by 100.
NPA = 50,00,000 / 2,00,00,000 x 100= 25%

What Happens to Non Performing Assets
For non-performing assets, there are two possible scenarios:
a) If assets are pledged as part of the loan, and non-payment persists, the lender may
resort tolegal action, compelling the borrower to liquidate the pledged assets.
b) When no assets are available, prolonged non-payment may lead the lender to classify
the loan as bad debt. Additionally, the lender might transfer the NPA account to a collection
agency at a discounted rate.
Causes of NPA
Some of the causes of Non Performing Asset are as follows:
Economic Downturns: When the economy is in a downturn, businesses may experience

financialdifficulties and may be unable to repay their loans.
Borrower Fraud: In some cases, borrowers may deliberately default on their loans in order
to avoidrepaying them.
Poor Lending Practices: Banks may make loans to borrowers who are not creditworthy.
This canlead to NPAs if the borrowers are unable to repay their loans.
Lack of Monitoring: Banks may not adequately monitor borrowers’ repayment records,
which canlead to NPAs.
Changes in the Economic Environment: Changes in the economic environment, such as a

rise in interest rates or a decline in commodity prices, can make it more difficult for
borrowers to repay their loans.

Impact of NPA on Banks, Borrowers, and the Economy Challenges faced by Banks
due to NPAs
Banks have their fair share of challenges when it comes to dealing with non-
performing assets(NPA). Some of these challenges are:
Financial Losses: NPAs hit banks where it hurts the most – their wallets. When borrowers
fail to repay their loans, banks face financial losses as they are unable to recover the
principalamount and interest.
Provisioning Pressures: Banks set aside provisions for NPAs as per regulatory guidelines.
Higher NPAs can mean larger provisions, which may put a strain on the bank’s financials.
It’s like setting aside money for rainy days that may never seem to end.
Liquidity Struggles: NPAs tie up a significant chunk of a bank’s funds. This can make it
difficult for them to lend money and meet the liquidity needs of their customers. This
liquidity strain can hamper the bank’s ability to generate revenue and grow its business.
Credit Quality Concerns: NPAs signal deteriorating asset quality, which can raise red flags
for lenders. Credit rating downgrades may follow, increasing borrowing costs for the bank
and shaking investor confidence. It’s like having a black mark on your credit history that
may be hard to shake off.
Reputation at Stake: High NPAs can tarnish a bank’s reputation and shake customer trust.
If people start losing faith in a bank’s ability to recover loans, they may withdraw their
deposits. And take their business elsewhere. It’s like a domino effect that can further
weakenthe bank’s financial standing.

Impact of Non Performing Asset (NPA) on Borrowers
Non-performing assets don’t just affect banks; they have a significant impact on
borrowers aswell. Let’s explore how:
1. Creditworthiness:
When a borrower’s loan turns into a Non Performing Asset, it adversely affects their
creditworthiness and credit score. This makes it challenging for them to secure loans or
credit in the future. Lenders become cautious and may perceive them as high-risk borrowers,
resulting in limited access to financial resources.
2. Legal Consequences:
If a borrower fails to repay their loan, the bank may initiate legal proceedings to
recover the outstanding amount. This can lead to litigation, which not only adds to the
borrower’s financial burden but also damages their reputation and credibility.
3. Asset Seizure:
In certain cases, banks have the right to seize and sell collateral provided by the
borrower to recover the outstanding loan amount. This can result in the loss of valuable
assets,causing significant financial setbacks for the borrower.
4. Limited Financial Options:

Borrowers with NPAs find themselves in a tough spot when it comes to obtaining
additional financing. They may face difficulties in availing of new loans or credit facilities,
which can hamper their ability to meet personal or business financial needs.
5. Negative Credit History:

The NPA status of a loan is recorded in the borrower’s credit history, which can have
long-term consequences. Other lenders, including banks and financial institutions, can
access this information when assessing creditworthiness. The presence of NPAsin the credit
history can lead to higher interest rates, stricter borrowing terms, and limited options.

Impact of Non Performing Assets (NPA) on the Economy
The impact of Non-Performing Assets on the economy is significant and can have far-
reaching consequences. Let’s explore how:
 Financial Stability: High levels of Non Performing Assets weaken the financial stability of
banks, reducing their ability to lend and support economic growth.
 Credit Crunch: Non Performing Assets restrict the availability of credit, making it
difficult for businesses and individuals to access loans for expansion, investment, or
personal needs.
 Capital Erosion: NPAs erode the capital base of banks. As it requires them to set
aside provisions and allocate resources for loan losses. This can lead to capital
shortages and necessitate capital replenishment through equity dilution or
government assistance.
 Economic Productivity: Non Performing Assets disrupt the functioning of businesses. As

theystruggle to repay loans, leading to closures, job losses, and reduced productivity. This,
in turn, affects overall economic output and growth.
 Confidence and Investor Sentiment: High levels of NPAs erode investor confidence
in thebanking sector and the overall economy. This can result in reduced investments,
both domestic and foreign, impacting economic development.
 Fiscal Implications: NPAs create a burden on government finances as they may require
financial assistance or bailouts to stabilize banks. This puts additional pressure on the
fiscalbudget and limits the government’s ability to allocate funds for other developmental
purposes.

Non Performing Assets in India encompass various sectors, including:
a) Non-performing loans in the banking sector, both public and private banks.
b) NPAs in sectors such as infrastructure, power, telecommunications, real estate, andtextiles.
c) Non-performing advances in cooperative banks and regional rural banks.
d) Non-performing assets in non-banking financial companies (NBFCs).
e) NPAs in the agricultural sector, such as overdue crop loans or agri-business loans.

Preventive Measures to Avoid Non Performing Assets (NPA)
A. Importance of Credit Risk Assessment and Due Diligence
Credit risk assessment is the process of evaluating the likelihood that a borrower will
default on a loan. However, it is advisable that banks and other lenders may conduct
thorough credit risk assessments and due diligence before making loans. This may help
them to identify borrowers who are more likely to default on their loans and avoid making
loans to these borrowers.
B. Effective Loan Monitoring and Recovery Mechanisms
After approving the loan, it is important for banks and other lenders to monitor the
borrower’s repayment performance on a regular basis. This may help them to identify
potential problems early on and take steps to prevent them from becoming Non Performing
Assets. If a borrower is having difficulty repaying a loan, banks and other lenders should
intervene early. This may involve providing the borrower with financial counselling or
restructuring the loan terms.
C. Strengthening Risk Management Practices in the Banking Sector
It’s advisable for banks and other lenders to have a system in place for tracking and
reporting onNPAs. This may help them to identify trends and to take steps to address any
problems.
By taking these preventive measures, banks and other lenders can help to reduce the risk of
NPAs.
Nonperforming assets continue to be a significant concern for the financial sector, with far-
reaching implications for banks, borrowers, and the overall economy.
The rising tide of Non Performing Assets (NPA) demands proactive measures to mitigate
risks, improve asset quality, and strengthen the financial health of institutions. However,
through effective credit risk assessment, robust loan monitoring mechanisms, and stringent
regulatory oversight, the management and resolution of NPAs can be improved.

CHAPT V
COMPANY PROFILE

History
ICICI Bank was established in 1996 by the Industrial Credit and Investment
Corporation of India, an Indian financial institution, as a wholly owned subsidiary. The
parent company was formed in 1955 as a joint-venture of the World Bank, India's public-
sector banks and public- sector insurance companies to provide project financing to Indian
industry. The bank was initially known as the Industrial Credit and Investment Corporation
of India Bank, before it changed its name to the abbreviated ICICI Bank. The parent
company was later merged into ICICI Bank. ICICI Bank launched internet banking
operations in 1998
ICICI's shareholding in ICICI Bank was reduced to 46 percent, through a public
offering ofshares in India in 1998, followed by an equity offering in the form of American
Depositary Receipts on the NYSE in 2000. ICICI Bank acquired the Bank of Madura
Limited in an all- stock deal in 2001, and sold additional stakes to institutional investors
during 2001-02.
In the 1990s, ICICI transformed its business from a development financial institution
offering only project finance to a diversified financial services group, offering a wide variety
of products and services, both directly and through a number of subsidiaries and affiliates
like ICICI Bank. In 1999, ICICI become the first Indian company and the first bank or
financial institution from non-Japan Asia to be listed on the NYSE.
In 2000, ICICI Bank became the first Indian bank to list on the New York Stock
Exchange with its five million American depository shares issue generating a demand
book 13 times theoffer size.
In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the
merger of ICICI and two of its wholly owned retail finance subsidiaries, ICICI Personal
Financial Services Limited and ICICI Capital Services Limited, with ICICI Bank. The
merger was approved by shareholders of ICICI and ICICI Bank in January 2002, by the
High Court of Gujarat at Ahmadabad in March 2002, and by the High Court of Judicature
at Mumbai andthe Reserve Bank of India in April 2002.
In 2008, following the 2008 financial crisis, customers rushed to ATM's and branches
in some locations due to rumors of adverse financial position of ICICI Bank. The Reserve
Bank of India issued a clarification on the financial strength of ICICI Bank to dispel the
rumors.

Introduction
ICICI Bank Limited is an Indian diversified financial services company headquartered

in Mumbai, Maharashtra. It is the second largest bank in India by assets and third largest
by market capitalization. It offers a wide range of banking products and financial services to
corporate and retail customers through a variety of delivery channels and through its
specialized subsidiaries in the areas of investment banking, life and non-life insurance,
venturecapital and asset management. The Bank has a network of 2,630 branches and 8,003
ATM's inIndia, and has a presence in 19 countries, including India.
The bank has subsidiaries in the United Kingdom, Russia, and Canada; branches in
United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International
Finance Centre; and representative offices in United Arab Emirates, China, South Africa,
Bangladesh, Thailand, Malaysia and Indonesia. The company's UK subsidiary has
established branches inBelgium and Germany.
ICICI Bank is India’s Second largest private sector bank in market capitalization and
second largest overall in terms of assets. The bank has a network of 1,626 branches and
about 4,883 ATMs in India and presence in 18 countries.
The Industrial credit and investment corporation of India limited (ICICI) was
incorporated in 1955 at the initiative of World Bank, the government of India and
representatives of Indian industry, with the objective of creating a development financial
institution for providing medium– term and long- term project financing to Indian
businesses. A.Ramaswami Mudaliaris elected as the first chairman of ICICI Limited.
SANDEEP BAKSHI is currently managing director and CEO of ICICI Bank.
Sandeep Bakhshi, an employee of ICICI since 1986, was appointed as MD & CEO in
October2018.Prior to this, he was the managing director and CEO of ICICI Prudential Life
Insurancefrom August 2010 to June 2018 and MD and CEO for ICICI Lombard General
Insurance Company in April 2002.

ICICI BANK LIMITED
ICICI Bank Limited is an Indian multinational bank and financial services company
headquartered in Mumbai with registered office in Vadodara. ICICI Bank is a large private
sector bank in India offering a diversified portfolio of financial products and services to
retail, SME and corporate customers. The Bank has an extensive network of branches,
ATMs and other touch-points .This development finance institution has a network of 5,900
branches and 16,650 ATMs across India and has a presence in 17 countries.
VISION AND MISSION

Vision
 To be the leading provider of financial services in India and a major global bank.
Mission
 We will leverage our people, technology, speed and financial capital to:
 Be the banker of first choice for our customers by delivering high quality, world-
class productsand services.
 Expand the frontiers of our business globally.
 Play a proactive role in the full realization of India's potential.
 Maintain a healthy financial profile and diversify our earnings across businesses and
geographies.
 Maintain high standards of governance and ethics.

ORGANIZATIONAL STRUCTURE:
ICICI Bank's organization structure is designed to be flexible and customer- focused,

whileseeing to ensure effective control and supervision and consistency in standards across
the organization and align all areas of operations to overall organisational objectives. The
organization structure is divided into six principal groups- Retail Banking, Wholesale
Banking, International Banking, Rural (Micro- Banking) and Agriculture Banking,
Government Banking and Corporate center.
History
ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial
institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was
reduced to 46% through a private offering of shares in India in fiscal 1998, an equity
offering in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's acquisition
of Bank of Madura Limited in an all-stock amalgamation in fiscal 2001, and secondary
market sales by ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI was
formed in 1955 at the initiative of the World Bank, the Government of India and
representatives of Indian industry. The principal objective was to create a development
financial institution for providing medium-term and long-term project financing to Indian
businesses.
In the 1990s, ICICI transformed its business from a development financial
institution offering only project finance to a diversified financial services group offering a
wide variety of products and services, both directly and through a number of subsidiaries
and affiliateslike ICICI Bank. In 1999, ICICI become the first Indian company and the
first bank or financial institution from non- Japan Asia to be listed on the NYSE. After
consideration of various corporate structuring alternatives in the context of the emerging
competitive scenario in the Indian banking industry, and the move towards universal
banking, the managements of ICICI and ICICI Bank formed the view that the merger of
ICICI with ICICI Bank would be the optimal strategic alternative for both entities, and
would create theoptimal legal structure for the ICICI group's universal banking strategy.
The merger would enhance value for ICICI shareholders through the merged entity's

access to low-cost deposits, greater opportunities for earning fee-based income and the
ability to participate in the payments system and provide transaction-banking services. The
merger would enhance value for ICICI Bank shareholders
through a large capital base and scale of operations, seamless access to ICICI's strong
corporate relationships built up over five decades, entry into new business segments,
higher market share in various business segments, particularly fee-based services, and
access to the vast talent pool of ICICI and its subsidiaries.
In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the
merger of ICICI and two of its wholly-owned retail finance subsidiaries, ICICI
Personal Financial Services Limited and ICICI Capital Services Limited, with ICICI
Bank. The merger was approved by shareholders of ICICI and ICICI Bank in January
2002, by the High Court of Gujarat at Ahmedabad in March 2002, and by the High
Court of Judicature at Mumbai and the Reserve Bank of India in April 2002.
Consequent to the merger, the ICICI group's financing and banking operations, both
wholesale and retail, have been integrated in a single entity.
ICICI Bank has formulated a Code of Business Conduct and Ethics for its
directors andemployees.

Annual Report 2022-23
BOARD OF DIRECTORS
BOARD MEMBERS
Girish Chandra Chaturvedi Hari L. Mundra S. Madhavan Neelam Dhawan

Non-Executive (part-time) Independent Director Independent Director Independent Director
Chairman
Radhakrishnan Nair B. Sriram Uday Chitale Vibha Paul Rishi

Independent Director Independent Director Independent Director Independent Director
Sandeep Bakhshi Rakesh Jha Sandeep Batra

Managing Director & Executive Director Executive Director
CEO
Anindya Banerjee Prachiti Lalingkar

KEY PERSONNEL Group Chief Financial Officer Company Secretary
BOARD COMMITTEES
Audit Committee Board Governance, Remuneration Corporate Social Responsibility
& Nomination Committee Committee
Uday Chitale, Chairman
Neelam Dhawan, Chairperson Girish Chandra Chaturvedi, Chairman
S. Madhavan
Girish Chandra Chaturvedi Radhakrishnan Nair
Radhakrishnan Nair
B. Sriram Uday Chitale
Vibha Paul Rishi
Rakesh Jha
Customer Service Fraud Monitoring Committee

Credit Committee
Committee Vibha Paul Rishi, Radhakrishnan Nair, Chairman
Sandeep Bakhshi, Chairman
Chairperson S. Madhavan
Hari L. Mundra
Hari L. Mundra Neelam Dhawan
B. Sriram
Sandeep Bakhshi Sandeep Bakhshi
Rakesh Jha
Rakesh Jha Rakesh Jha
Stakeholders Relationship Committee
Risk Committee
Information Technology Hari L. Mundra, Chairman
Strategy Committee S. Madhavan, Chairman
Uday Chitale
B. Sriram, Chairman Girish Chandra Chaturvedi
Sandeep Batra
Neelam Dhawan Vibha Paul Rishi
Rakesh Jha Sandeep Batra
Sandeep Batra

Products
1. Extra home loans
'ICICI Bank Extra Home Loans' are 'mortgage-guarantee' backed loans for retail
customers who aspire to purchase their first homes in the affordable housing segment.
This was introduced in August 2015 in association with India Mortgage Guarantee
Corporation (IMGC). IMGC is a joint venture between National Housing Bank (NHB),
an RBI subsidiary which regulates Home Finance Companies in India; NYSE-listed
Genworth Financial Inc., a Fortune 500 company; International Finance Corporation
(IFC) and Asian Development Bank (ADB).
2. Smart Vault
'Smart Vault' are fully automated lockers available 24x7, including weekends and
post banking hours were launched in August 2015. The 'Smart Vault' uses robotic
technology to access the lockers from the safe vault conveniently at any time of their
preference in total privacy, without any intervention of the branch staff.
3. Saral Loans
In August 2015, ICICI Bank introduced 'Saral-Rural Housing Loan'. Applicants

from rural areas including women borrowers as well as seekers from weaker sections can
now avail home loans at the ICICI Bank Base Rate ("I-Base") which is currently at
9.70%. An eligible borrower can take up to Rs.15 lac under the 'ICICI Bank Saral-Rural
Housing Loan'.
4. ICICI Bank Uni fare Bangalore Metro Card
ICICI Bank and Bangalore Metro Rail Corporation Limited (BMRCL) in April
2015,announced the launch of the 'ICICI Bank Uni fare Bangalore Metro Card' to offer
the commuters dual benefits of an ICICI Bank credit or debit card and BMRCL's smart
card, called Namma Metro Smart Card
5. "Touch n Remit' facility for NRIs in Kingdom of Bahrain In March 2015, ICICI
Bank tied up with SADAD Electronic Payments WLL to offer remittance service for
NRIs based in Bahrain, enabling them to transfer monies instantly to India from the
latter's kiosks spread across the Kingdom of Bahrain. This facility has been named as
'Touch n Remit'
5 ICICI Bank Ltd launches 'Video Banking' for NRI
In February 2015, ICICI Bank announced the launch of 'Video Banking' for all its
NRI (Non Resident Indian) customers. Using this service, the customers can now
connect with a customer care representative over a video call, round-the-clock, on all
days from anywhere using their smart phone.
6. Pockets by ICICI Bank
In February 2015, ICICI Bank Re-Launched POCKETS, now working as a

"Digital wallet" for everyone (Android OS users only). The Wallet be can be opened by
anyone and can conduct transactions like recharge, shopping, transfer money using the
virtual visa card which is issued when signing up for the wallet
7. ICICI Bank Pay on Twitter
ICICI Bank in January, 2015 launched banking services on Twitter, christened as

'ICICI Bank Pay. This service in India enables ICICI Bank customers to transfer money
to anyone in the country who has a Twitter account, check account balance, view last
three transactions and recharge prepaid mobile in a completely secure manner.
8. Contactless Credit and Debit Cards
ICICI Bank in January, 2015 announced the launch of the country's first
'Contactless' debit and credit cards, enabling its customers to make electronic payments
by just waving thecards near the merchant terminal in lieu of dipping or swiping them.
These cards are based on the Near Field Communication (NFC) technology, which
provides customers the improved convenience of speed as these cards require
significantly less time than traditional cards to complete a transaction along with
enhanced security as they remain in control of the customer.
9. My Savings Rewards
ICICI Bank has rolled-out the programme 'MySavings Rewards' from 1 September
2012, where reward points are offered to individual domestic customers for a variety of
transactions done through the savings bank account. Reward points are offered
automatically to customers for activating Internet banking, shopping online/ paying
utility bills with Internet banking and auto- debit from savings account towards equated
monthly installments for home/auto/ personal loan/ recurring deposit
10. I Wish- the flexible recurring deposit
I Wish is a flexible recurring deposit product launched by ICICI Bank for its savings
account customers. Unlike a traditional recurring deposit, I Wish allows customers to
save varying amounts of money at any time of their choice. Customers can create several
goals and track their progress on an online interface.
ICICI Bank has developed this product in collaboration with Social Money. ICICI
Bank has also launched an app for Android and Apple smartwatches. The app will
provide the facility of online banking transaction from smartwatch.
Go green initiative
The Go Green Initiative is an initiative that moves beyond people, processes and
customers to cost effective automated channels to build awareness of our environment,
nation and society. The various green products and services are Insta banking (alternate
banking options like- Internet banking, i-Mobile banking, & IVR Banking. On 22 September
2014 ICICI Bank launched Four New Next Gen Mobile Banking Apps), Vehicle Finance
for car models which use alternate modes of energy (50% waiver on processing fee of auto
loans.
Parent Bank
1. ICICI Bank Limited Subsidiaries

2. ICICI Bank Canada
3. ICICI Bank UK PLC
4. ICICI International Limited
5. ICICI Prudential Life Insurance Company Limited
6. ICICl Prudential Pension Funds Management Company Limited
7. lClCI Securities Primary Dealership Limited
8. lCICI Home Finance Company Limited
9. lCICI Investment Management Company Limited
10. ICICI Securities Limited
11. ICICl Securities Holdings Toe.I 2. TCICI Securities Inc.

12. IClCI Venture Funds Management Company Limited
13. ICICI Trusteeship Services Limited
14. ICICI Prudential Asset Management Company Limited
15. ICICI Prudential Trust Limited
16. ICICI Strategic Investments Limited
Material Subsidiaries
The bank is involved in various related activities through its subsidiaries :
1. ICICI Prudential Life Insurance Co. Ltd (51% stake)- It is a JV between ICICI
Bank and Prudential Plc, London which is involved in the business of issuing life insurance
policies to the customers. Presently, it has AUM of ~2 lakh crores.
2. ICICI Lombard General Insurance Co. Ltd (52% stake)- It provides general
insurance solutions. It has solutions for businesses, personal and project liabilities across
rural & urban areas.
3. ICICI Prudential Asset Management Co. Ltd (51% stake) - It is a leading AMC
in thecountry which focuses on creating long term wealth for investors through simple and
relevant investment solutions.
4. ICICI Securities Ltd (75% stake) –
It is involved in activities like stock broking, merchant banking, portfolio

management, investment adviser and research analyst.
5. ICICI Securities Primary Dealership Ltd (100% stake) –
It is a leader in the Indian fixed income and money markets, with a strong franchise
across the spectrum of interest rate products and services – institutional sales and trading,
resource mobilization and research.

CHAPTER VI
DATA ANALYSIS
&
INTERPRETATION

SWOT ANALYSIS OF ICICI BANK LIMITED
What Is SWOT Analysis?

SWOT (strengths, weaknesses, opportunities, and threats) analysis is a framework
used to evaluate a company's competitive position and to develop strategic planning. SWOT
analysisassesses internal and external factors, as well as current and future potential.
A SWOT analysis is designed to facilitate a realistic, fact-based, data-driven look at the

strengths and weaknesses of an organization, initiatives, or within its industry. The
organization needs to keep the analysis accurate by avoiding pre-conceived beliefs or gray
areas and instead focusing on real-life contexts. Companies should use it as a guide and not
necessarily as a prescription.
Components of SWOT Analysis

Every SWOT analysis will include the following four categories. Though the elements
and discoveries within these categories will vary from company to company, a SWOT
analysis isnot complete without each of these elements
Strengths
Strengths describe what an organization excels at and what separates it from the
competition:a strong brand, loyal customer base, a strong balance sheet, unique technology,
and so on.
For example, a hedge fund may have developed a proprietary trading strategy that returns
market-beating results. It must then decide how to use those results to attract new investors.
Weaknesses
Weaknesses stop an organization from performing at its optimum level. They are
areas where the business needs to improve to remain competitive: a weak brand, higher-
than-average turnover, high levels of debt, an inadequate supply chain, or lack of capital.
Opportunities
Opportunities refer to favorable external factors that could give an organization a

competitive advantage. For example, if a country cuts tariffs, a car manufacturer can export
its cars into a new market, increasing sales and market share.
Threats
Threats refer to factors that have the potential to harm an organization. For example,
a drought is a threat to a wheat-producing company, as it may destroy or reduce the crop
yield. Other common threats include things like rising costs for materials, increasing
competition, tight labor supply. and so on.

SWOT Table
Analysts present a SWOT analysis as a square segmented into four quadrants, each
dedicatedto an element of SWOT. This visual arrangement provides a quick overview of the
company’sposition. Although all the points under a particular heading may not be of equal
importance, they all should represent key insights into the balance of opportunities and
threats, advantages and disadvantages, and so forth.
The SWOT table is often laid out with the internal factors on the top row and the
external factors on the bottom row. In addition, the items on the left side of the table are
more positive/favorable aspects, while the items on the right are more concerning/negative
elements.

Benefits of SWOT Analysis
A SWOT analysis won't solve every major question a company has. However, there's
anumber of benefits to a SWOT analysis that make strategic decision-making easier.
A SWOT analysis makes complex problems more manageable.
There may be an overwhelming amount of data to analyze and relevant points to

consider when making a complex decision. In general, a SWOT analysis that has been
prepared by paring down all ideas and ranking bullets by importance will aggregate a large,
potentially overwhelming problem into a more digestible report.
A SWOT analysis requires external consider.
Too often, a company may be tempted to only consider internal factors when making
decisions. However, there are often items out of the company's control that may influence
the outcome of a business decision. A SWOT analysis covers both the internal factors a
companycan manage and the external factors that may be more difficult to control.
A SWOT analysis can be applied to almost every business question.
The analysis can relate to an organization, team, or individual. It can also analyze a
full product line, changes to brand, geographical expansion, or an acquisition. The SWOT
analysis is a versatile tool that has many applications.
A SWOT analysis leverages different data sources.
A company will likely use internal information for strengths and weaknesses. The
company will also need to gather external information relating to broad markets,
competitors, or macroeconomic forces for opportunities and threats. Instead of relying on a
single, potentially biased source, a good SWOT analysis compiles various angles.
A SWOT analysis may not be overly costly to prepare.
Some SWOT reports do not need to be overly technical; therefore, many different
staffmembers can contribute to its preparation without training or external consulting.

SWOT ANALYSIS OF ICICI BANK LIMITED
Strengths of ICICI Bank Limited
Superb Performance in New Markets – ICICI Bank Limited has built expertise at
entering new markets and making success of them. The expansion has helped the
organization to build new revenue stream and diversify the economic cycle risk in the
markets it operates in.
Highly successful at Go To Market strategies for its products.
Strong dealer community – It has built a culture among distributor & dealers where the
dealers not only promote company’s products but also invest in training the sales team to
explain to the customer how he/she can extract the maximum benefits out of the products.
Strong Brand Portfolio – Over the years ICICI Bank Limited has invested in building a
strongbrand portfolio. The SWOT analysis of ICICI Bank Limited just underlines this fact.
This brand portfolio can be extremely useful if the organization wants to expand into new
product categories.
Successful track record of integrating complimentary firms through mergers &

acquisition. It has successfully integrated number of technology companies in the past few
years to streamlineits operations and to build a reliable supply chain.
Strong Free Cash Flow – ICICI Bank Limited has strong free cash flows that provide
resourcesin the hand of the company to expand into new projects.
MARKET LEADER
ICICI Bank is a leading private financial institution in the Indian market. The company has
been operating its business in the financial industry for the past roundabout 30 years.
Decades of experience and a large network allowed the company to achieve the market
leadership position in the Indian private banking industry.
WORLDWIDE NETWORK
ICICI Bank is operating its business in approximately 19 countries across the world. The
company has established a strong market network with more than 14000 ATMs and 5900
location points across India and 19 other countries across the world. The worldwide
networkhelps the company to directly connect with customers
TECHNOLOGY
ICICI Bank has invested a significant amount of resources in the implementation of the
latest technology. They are mobile applications, NRI services, mobile banking, and net
banking. They have allowed the company to facilitate their customers by offering various
modes of transactions.
PRODUCT PORTFOLIO
ICICI Bank offers a very vast product and services portfolio and it helps the company to
target various segments of the customer market. Resultantly, the financial service-providing
company earns revenue from multiple sources of income.
MARKETING
In order to strengthen its brand name and attract the attention of customers, ICICI Bank
launches various types of marketing and promotional campaigns. They are like receiving
endorsements from celebrities; sponsoring mega sports events, and other digital and
traditionalmarketing campaigns.
AWARDS & RECOGNITION
ICICI Bank has won various awards and recognitions in the financial industry. The
company is a socially responsible organization and engages in different types of charities,
social welfare projects, and initiatives.
Wide geographic presence - ICICI Bank has extensive dealer network and associates
network that not only help in delivering efficient services to the customers but also help in
managing competitive challenges in Regional Banks industry.

Weakness of ICICI Bank Limited
 Weakness are the areas where ICICI Bank Limited can improve upon. Strategy is
about making choices and weakness are the areas where a company can improve
using SWOT analysis and build on its competitive advantage and strategic
positioning.
 Need more investment in new technologies. Given the scale of expansion and
different geographies the company is planning to expand into, ICICI Bank Limited
needs to put more money in technology to integrate the processes across the board.
Right now the investment intechnologies is not at par with the vision of the company.
 Investment in Research and Development is below the fastest growing players in the
industry.Even though ICICI Bank Limited is spending above the industry average on
Research and Development, it has not been able to compete with the leading players
in the industry in terms of innovation. It has come across as a mature firm looking
forward to bring out products based on tested features in the market.
 The company has not being able to tackle the challenges present by the new entrants
in the segment and has lost small market share in the niche categories. ICICI Bank
Limited has tobuild internal feedback mechanism directly from sales team on ground
to counter these challenges.
 High attrition rate in work force – compare to other organizations in the industry
ICICI Bank Limited has a higher attrition rate and have to spend a lot more compare
to its competitors on training and development of its employees.
 Organization structure is only compatible with present business model thus limiting
expansion in adjacent product segments.
 Not highly successful at integrating firms with different work culture. As mentioned

earlier even though ICICI Bank Limited is successful at integrating small companies
it has its share offailure to merge firms that have different work culture.
 Not very good at product demand forecasting leading to higher rate of missed
opportunities compare to its competitors. One of the reason why the days inventory
is high compare to its competitors is that ICICI Bank Limited is not very good at
demand forecasting thus end up keeping higher inventory both in-house and in
channel.
MONEY LAUNDERING CONTROVERSY
Online magazine Cobra post released video footage accusing officials of ICICI Bank
engagedin money laundering activities in 2013. Reserve Bank of India and the Government
of India launched an internal investigation to deal with the issue; the company suspended 18
high- ranking officials. Such types of controversies and allegations have negatively
impacted the company’s reputation.
COMPETITION
Indian private banking market has become highly competitive in recent years. Various
renowned brands have emerged in the financial industry, and they have saturated the
Indian financial market. However, it has become highly difficult for the company to
maintain its market share in the presence of tough competition.
Niche markets and local monopolies that companies such as ICICI Bank able to
exploit are fast disappearing. The customer network that ICICI Bank has promoted is proving
less and less effective.
Low investments into ICICI Bank's customer oriented services - This can lead to
competitors gaining advantage in near future. ICICI Bank needs to increase investment into
research and development especially in customer services oriented applications.
- Declining market share of ICICI Bank with increasing revenues - the Regional Banks industry
is growing faster than the company. In such a scenario ICICI Bank has to carefully analyze the
various trends within the Financial sector and figure out what it needs to do to drive future
growth

Opportunities for ICICI Bank Limited
1. Economic uptick and increase in customer spending, after years of recession and
slow growthrate in the industry, is an opportunity for ICICI Bank Limited to capture new
customers andincrease its market share.
2. The market development will lead to dilution of competitor’s advantage and enable
ICICIBank Limited to increase its competitiveness compare to the other competitors.
3.New customers from online channel – Over the past few years the company has
invested vastsum of money into the online platform. This investment has opened new sales
channel for ICICI Bank Limited. In the next few years the company can leverage this
opportunity by knowing its customer better and serving their needs using big data analytics.
4.Decreasing cost of transportation because of lower shipping prices can also bring
down the cost of ICICI Bank Limited’s products thus providing an opportunity to the
company - either to boost its profitability or pass on the benefits to the customers to gain
market share.
5.Organization’s core competencies can be a success in similar other products field. A

comparative example could be - GE healthcare research helped it in developing better Oil
drilling machines.
6. The new technology provides an opportunity to ICICI Bank Limited to practices

differentiated pricing strategy in the new market. It will enable the firm to maintain its loyal
customers with great service and lure new customers through other value oriented
propositions.
7.New environmental policies – The new opportunities will create a level playing field
for all the players in the industry. It represent a great opportunity for ICICI Bank Limited
to drive home its advantage in new technology and gain market share in the new product
category.

TARGETING YOUTH
The young consumer market has shown a lot of interest in digital media, mobile
banking, net banking, and online transaction. In order to stay relevant, ICICI Bank
should invest more resources in the development of its online banking platform. It would
help the company to attract more customers and increase sales.
EXPANSION
African developing market holds significant potential for growth. It presents a great
opportunity for the financial company to expand its business in African countries; it would
help the company to amplify its brand influence.
RURAL AREAS
It is no doubt ICICI Bank has got a worldwide network of ATMs and locations in 19
countries across the world. But there are still many rural areas locally and globally that don’t
have access to financial services. The company should consider expanding its business in
rural areas.
Increasing customer base in lower segments - As customers have to migrate from un-
organizedoperators in the Financial industry to licensed players. It will provide ICICI Bank
an opportunity to penetrate entry level market with a no-frill offering.
Increasing government regulations are making it difficult for un-organized players to

operate in the Regional Banks industry. This can provide ICICI Bank an opportunity to
increase the customer base.
Trend of customers migrating to higher end products - It represents great opportunity
for ICICIBank, as the firm has strong brand recognition in the premium segment, customers
have experience with excellent customer services provided by ICICI Bank brands in the
lower segment. It can be a win-win for the company and provides an opportunity to increase
the profitability.
Accelerated technological innovations and advances are improving industrial
productivity, allowing suppliers to manufacture vast array of products and services. This
can help ICICI Bankto significantly venture into adjacent products.
Threats ICICI Bank Limited Facing
Changing consumer buying behavior from online channel could be a threat to the existing
physical infrastructure driven supply chain model.
Shortage of skilled workforce in certain global market represents a threat to steady growth
ofprofits for ICICI Bank Limited in those markets.
The demand of the highly profitable products is seasonal in nature and any unlikely event
duringthe peak season may impact the profitability of the company in short to medium term.
Rising raw material can pose a threat to the ICICI Bank Limited profitability.
The company can face lawsuits in various markets given - different laws and continuous
fluctuations regarding product standards in those markets.
Intense competition – Stable profitability has increased the number of players in the
industry overlast two years which has put downward pressure on not only profitability but
also on overall sales.
PRIVACY ISSUES
Net banking and online transactions facilitate customers and offer a great customer
experience. But they amplify the risk of cyberattacks, hacking, and privacy issues. The
company should investresources in the safety and security of its platform.
NOT FOLLOWING TRENDS
The large network of ICICI banks makes it highly difficult for financial institution to
implement changes globally. That’s why the company is very slow when it comes to
responding to the changing market trends.
POLICIES & REGULATIONS
The banking regulations and policies of various countries are different, and they keep on
changing their policies over time. It is significant for the financial institution to beware of
the regulations and comply with them.
Changing demographics –
As the baby boomers are retiring and new generation finding hard to replace their
purchasing power. This can lead to higher profits in the short run for ICICI Bank but
reducing margins over the long run as young people are less brand loyal and more open to
experimentation.
Changing political environment with US and China trade war,

Brexit impacting European Union, and overall instability in the middle east can
impact ICICI Bank business both in localmarket and in international market.
Competitors catching up with the product development –

Even though at present the ICICI Bank is still leader in product innovation in the
Regional Banks segment. It is facing stiff challenges from international and local
competitors.
Trade Relation between US and China can affect ICICI Bank growth plans –
This can lead tofull scale trade war which can hamper the potential of ICICI Bank to
expand operations in China.
Competitive pressures –
As the new product launch cycles are reducing in the Financial industry. It has put
additional competitive pressures on players such as ICICI Bank. Given the large customer
base, ICICI Bank can't respond quickly to the needs of the niche markets that disruptors are
focusing on.
Saturation in urban market and stagnation in the rural markets –

For ICICI Bank this trend is an ongoing challenge in the Regional Banks segment.
One of the reasons is that the adoption of products is slow in rural market. Secondly it is
more costly for ICICI Bank to serve the rural customers than urban customers given the
vast distances and lack of infrastructure.

Limitations of SWOT Analysis for ICICI Bank Limited
Although the SWOT analysis is widely used as a strategic planning tool, the analysis
does haveits share of limitations.
Certain capabilities or factors of an organization can be both a strength and weakness

at the same time. This is one of the major limitations of SWOT analysis . For example
changing environmental regulations can be both a threat to company it can also be an
opportunity in a sense that it will enable the company to be on a level playing field or at
advantage to competitorsif it able to develop the products faster than the competitors.
SWOT does not show how to achieve a competitive advantage, so it must not be an
end in itself.
The matrix is only a starting point for a discussion on how proposed strategies could
be implemented. It provided an evaluation window but not an implementation plan based
onstrategic competitiveness of ICICI Bank Limited
SWOT is a static assessment - analysis of status quo with few prospective changes. As
circumstances, capabilities, threats, and strategies change, the dynamics of a competitive
environment may not be revealed in a single matrix.
SWOT analysis may lead the firm to overemphasize a single internal or external factor
in formulating strategies. There are interrelationships among the key internal and external
factorsthat SWOT does not reveal that may be important in devising strategies.

FINANCIAL HIGHLIGHTS
TOTAL DEPOSITS TOTAL ADVANCES

11808.41
10196.38
10645.72 3.3%
6395.79 8590.20
26.3%
9325.22 5461.35 4.8%
7,337.29
7.1%
5008.99 6,452.90 5.1%
27.2%
7709.69 5,866.47
8.4% 28.2% 8.6%
6529. 20 10.7%
4231.51 28.4% 6.2%
54.7%
29.2% 8.9%
5.1 %
3289.79 52.9%
9.8 %
3797.76 4.1%
3599.57 8.8%
3.2%
2,954.53 8.5% 50.3% 51.8%
2,455.91 48.4%
2,276.71
1,361.70 1,584.80 1,614.86

962.70. 1,022.27
March. March. March. March. March

March
2019 2020. 2021. 2022. 2023 March March March March 2023
Current Account (` in billion) Term Deposit (` in billion) 2019 2020 2021 2022
Overseas
Savings Account (` in billion) Total (` in billion) Retail Business Banking Total (` in billion)
. Rural Loans Domestic Corporate & SME
NET WORTH CAPITAL ADEQUACY

. 19.12%
18.34%
19.16%
2,007.16 16.89% 16.11%
1,705.12
1,475.09
1,165.04
1,083.68
17.60% 17.12%
16.80%
13.63% 13.39%
March. March. March. March. March March March. March March March
2019 2020. 2021. 2022 2023
2020 2021 2023
2019 2022
Net Worth (Equity Share Capital, Reserves and Surplus) Common Equity Tier 1
Tier I
(` in billion) Total
Tier II

NII & NIM PROVISION COVERAGE RATIO

& NET NPA RATIO
621.29 82.8%
79.2%
474.66
77.7%
389.89 75.7%
332.67
4.48%
270.15
3.96%
3.73% 3.69% 70.6%
3.42%
2.1%
1.4%
1.1%
0.8%. 0.5%
FY2019 FY2020 FY2021 FY2022 FY2023 March. March. March. March March
2019. 2020. 2021 2022. 2023
Provision coverage ratio (specific provisions as a percentage of gross NPAs)
Net Interest Income (NII) (` in billion)
Net NPA Ratio (based on customer assets)
Net Interest Margin (NIM)
PROFIT BEFORE TAX STANDALONE NET PROFIT

EXCLUDING TREASURY GAINS
424.73 318.96
233.39
297.06
161.93
151.3
127.55
79.31
24.11 33.63
FY2019 FY2020 FY2021 FY2022 FY2023 FY2019 FY2020 FY2021 FY2022 FY2023
Profit Before Tax (` in billion) Standalone Net Profit (` in billion)

The performance of ICICI Bank equity shares relative to the S&P BSE Sensitive Index (Sensex), S&P BSE Bank Index
(Bankex) and NYSE Financial Index during the period April 1, 2022 to March 31, 2023 is given in the following chart:
S&P BSE Sensex S&P BSE Bankex NYSE Financial Index ICICI Bank
140
120
100
80
60
Jun/22
Apr/22
Nov/22
Dec/22
Feb/23
Oct/22
Mar/23
May/22
Jan/23
Jul/22
Sep/22
Aug/22

Gross NPA% of top 10 banks in India in 2023 :
Sr banks Gross NPA (%)

no
1 HDFC Bank 1.12
2 ICICI Bank 2.87
3 State Bank of India 2.78
4 Kotak Mahindra Bank 1.80
5 Axis Bank 2.00
6 Indusind Bank 1.98
7 Bank of Baroda 4.00
8 Punjab National Bank 9.00
9 Union bank of india 7.53
10 IDBI Bank 6.00

Reveals the of Gross NPA of selected private sector bank in India For Financial Year 2022-23
THE Gross NPA OF HDFC Bank IS 1.12%.
The Gross NPA ICICI Bank is 2.87%.
The Gross NPA of State Bank of India is 2.78%.
The Gross NPA of Kotak Mahindra Bank is 1.80%.
The Gross NPA of Axis Bank is 2.00%.
The Gross NPA of Indusind Bank is 1.98%.
The Gross NPA of Bank of Baroda is 4.00%.
The Gross NPA of Punjab National Bank is 9.00%.
The Gross NPA of Union bank of INDIA is 7.53%.
THE Gross NPA of IDBI Bank is 6.00%.
Conclusion :
The ICICI Bank limited has Second lowest Gross NPA After HDFC Bank And
kotak Mahindra Bank Respectively.

NET NPA OF TOP 10 BANKS IN INDIA IN 2023
Sr.no Banks Net NPA (%)
1 HDFC Bank 0.27 :

2 ICICI Bank 0.51
3 State Bank of India 0.67

4 Kotak Mahindra Bank 0.40
5 Axis Bank 0.39

6 Indusind Bank 0.59
7 Bank of Baroda 1.00
8 Punjab National Bank 2.72

9 Union Bank of india 1.70
10 IDBI BANK 0.92

Reveals the of Gross NPA of selected private sector bank in India For Financial Year 2022-23
THE Gross NPA OF HDFC Bank IS 0.27%.
The Gross NPA ICICI Bank is 0.51%.
The Gross NPA of State Bank of India is 0.67%.
The Gross NPA of Kotak Mahindra Bank is 0.40%.
The Gross NPA of Axis Bank is 0.39%.
The Gross NPA of Indusind Bank is 0.59%.
The Gross NPA of Bank of Baroda is 1%.
The Gross NPA of Punjab National Bank is 2.72%.

The Gross NPA of Union bank of INDIA is 1.70%.
THE Gross NPA of IDBI Bank is 0.92%.
Conclusion:
The ICICI Bank limited has Fourth lowest NET NPA After HDFC Bank And Axis
Bank And kotak Mahindra Bank Respectively.

Gross NPA And NET NPA OF ICICI Bank in India for 2018 To 2023
YEAR ICICI Bank Limited
% of Gross NPA % of Net NPA
2022-23 2.87 0.51
2021-22 4.00 0.81
2020-21 8 2.10
2019-20 6 1.54
2018-19 7 2.29
INTERPRETATION OF ABOVE TABEL

THESE Reveals the Gross NPA And Net NPA OF ICICI Bank Limiter for 5 Years i.e.
From 2022-23 To 2018-19 The Gross and Net NPA are decreasing Year on year it increased
during Covid pandemic. It has one of the lowest Gross NPA And Net NPA in the India
Banking Industry
Chart for Above information in TABEL

GROSS NPA AND NET NPA OF ICICI BANK IN INDIA FROM 2018-2023 In
Rupees Crores.
YEAR ICICI Bank Limited
GROSS NPA NET NPA
2022-23 2,99,860.70 51,500.70
2021-22 33,294.92 6,931.04
2020-21 40,841.42 9,117.66
2019-20 40,829.09 9,923.24
2018-19 45.676.04 13,449.72
INTERPRATATION OF ABOVE TABEL

THESE Reveals the Gross NPA And Net NPA IN RUPEES Crore OF ICICI Bank Limiter for 5
Years i.e. From 2022-23 To 2018-19 The Gross and Net NPA are decreasing Year on year it
Increased during Covid pandemic. It has one of the lowest Gross NPA And Net NPA in the India
Banking Industry
Chart for above TABEL

Comparison OF NET PROFIT AND NET NPA OF ICICI BANK LIMITED IN

CRORES
YEAR ICICI BANK LIMITED

NET PROFIT NET NPA
2022-23 34,463 51,501
2021-22 25,784 6,931
2020-21 20,364 9,118
2019-20 11,225 9,923
2018-19 5,689 13,450
INTERPRATATION OF ABOVE TABELS
This tabel revels the comparison and relationship

Between the net profit and net npa of icici bank the net
Npa is decreasing year on year while the net profit is increasing
Year on year. This shows if npa are reduced it will increase the net
Profit of the company. The net npa of icici bank is decreasing and net
profit is increasing year on year due to good management of npa.

Performance Review: Quarter ended September 30, 2023
Profit before tax excluding treasury grew by 35.7% year-on-year to 13,731crore

(US$ 1.6 billion) in the quarter ended September 30, 2023 (Q2-2024)
Core operating profit grew by 21.7% year-on-year to 14,314 crore (US$ 1.7billion)
in Q2-2024
Profit after tax grew by 35.8% year-on-year to 10,261 crore (US$ 1.2 billion)in Q2-
2024
Total period-end deposits grew by 18.8% year-on-year to 12,94,742 crore

(US$ 155.9 billion) at September 30, 2023
Average current account and savings account (CASA) ratio was 40.8% inQ2-2024
Domestic loan portfolio grew by 19.3% year-on-year to 10,74,206 crore (US$
129.4 billion) at September 30, 2023
Net NPA ratio declined to 0.43% at September 30, 2023 from 0.48% at June 30,
2023
Provision coverage ratio on non-performing assets was 82.6% at September30, 2023
Including profits for the six months ended September 30, 2023 (H1-2024), totalcapital
adequacy ratio was 17.59% and Tier-1 capital adequacy ratio was 16.86% on a standalone
basis at September 30, 2023

Profit & Loss Account:
Profit before tax excluding treasury grew by 35.7% year-on-year to 13,731 crore
(US$ 1.6 billion) in Q2-2024 from 10,121 crore (US$ 1.2 billion) in the quarter ended
September 30, 2022 (Q2-2023)
The core operating profit grew by 21.7% year-on-year to 14,314 crore (US$ 1.7
billion) in Q2-2024 from 11,765 crore (US$ 1.4 billion) in Q2-2023; excluding dividend
income from subsidiaries/associates, core operating profit grew by 22.9% year-on-year in
Q2-2024
Net interest income (NII) increased by 23.8% year-on-year to 18,308 crore (US$
2.2 billion) in Q2-2024 from 14,787 crore (US$ 1.8 billion) in Q2-2023
The net interest margin was 4.53% in Q2-2024 compared to 4.31% in Q2-2023 and
4.78% in Q1-2024. The net interest margin was 4.65% in H1-2024
Non-interest income excluding treasury increased by 14.0% year-on-year to 5,861

crore (US$ 706 million) in Q2-2024 from 5,139 crore (US$ 619 million) inQ2-2023
Fee income grew by 16.2% year-on-year to 5,204 crore (US$ 627 million) in Q2-
2024 from 4,480 crore (US$ 539 million) in Q2-2023. Fees from retail, rural, business
banking and SME customers constituted about 78% of total fees in Q2- 2024
Provisions (excluding provision for tax) were 583 crore (US$ 70 million) in Q2-
2024 compared to 1,644 crore (US$ 198 million) in Q2-2023
There was a treasury loss of 85 crore (US$ 10 million) in Q2-2024, similar to Q2-
2023
The profit before tax grew by 36.0% year-on-year to 13,646 crore (US$ 1.6billion)
in Q2-2024 from 10,036 crore (US$ 1.2 billion) in Q2-2023
The profit after tax grew by 35.8% year-on-year to 10,261 crore (US$ 1.2 billion)in
Q2-2024 from 7,558 crore (US$ 910 million) in Q2-2023

Performance Review: Quarter ended June 30, 2023
Core operating profit less provisions (profit before tax excluding treasury
Gains) grew by 38.0% year-on-year to 12,595 crore (US$ 1.5 billion) in
The quarter ended June 30, 2023 (Q1-2024)
Core operating profit grew by 35.2% year-on-year to 13,887 crore (US$
1.7 billion) in Q1-2024
Profit after tax grew by 39.7% year-on-year to 9,648 crore (US$ 1.2
Billion) in Q1-2024
Total period-end deposits grew by 17.9% year-on-year to 12,38,737 crore
(US$ 151.0 billion) at June 30, 2023
Average CASA ratio was 42.6% in Q1-2024
Domestic loan portfolio grew by 20.6% year-on-year to 10,25,310 crore
(US$ 125.0 billion) at June 30, 2023
Net NPA ratio was 0.48% at June 30, 2023
Provision coverage ratio on non-performing assets was 82.4% at June 30,
2023
Including profits for Q1-2024, total capital adequacy ratio was 17.47% and
Tier-1 capital adequacy ratio was 16.76% on a standalone basis at June 30,
2023

Profit & loss account
The core operating profit less provisions (profit before tax excluding treasury
Gains) grew by 38.0% year-on-year to 12,595 crore (US$ 1.5 billion) in Q1-
2024 from 9,129 crore (US$ 1.1 billion) in the quarter ended June 30, 2022
(Q1-2023)
The core operating profit grew by 35.2% year-on-year to 13,887 crore (US$
1.7 billion) in Q1-2024 from 10,273 crore (US$ 1.3 billion) in the quarter
Ended June 30, 2022 (Q1-2023); excluding dividend income from
Subsidiaries/associates, core operating profit grew by 37.0% year-on-year in
Q1-2024
Net interest income (NII) increased by 38.0% year-on-year to 18,227 crore
(US$ 2.2 billion) in Q1-2024 from 13,210 crore (US$ 1.6 billion) in Q1-2023
The net interest margin was 4.78% in Q1-2024 compared to 4.01% in Q1-2023
And 4.90% in Q4-2023
Non-interest income, excluding treasury gains, increased by 12.0% year-on-
Year to 5,183 crore (US$ 632 million) in Q1-2024 from 4,629 crore (US$
564 million) in Q1-2023
Fee income grew by 14.1% year-on-year to 4,843 crore (US$ 590 million) in
Q1-2024 from 4,243 crore (US$ 517 million) in Q1-2023. Fees from retail,
Rural, business banking and SME customers constituted about 78% of total
Fees in Q1-2024

Provisions (excluding provision for tax) were 1,292 crore (US$ 157 million)
In Q1-2024 compared to 1,144 crore (US$ 139 million) in Q1-2023
There was a treasury gain of 252 crore (US$ 31 million) in Q1-2024
Compared to a gain of 36 Crore (US$ 4 million) in Q1-2023
The profit before tax grew by 40.2% year-on-year to 12,847 crore (US$ 1.6
Billion) in Q1-2024 from 9,165 crore (US$ 1.1 billion) in Q1-2023
The profit after tax grew by 39.7% year-on-year to 9,648 crore (US$ 1.2
Billion) in Q1-2024 from 6,905 crore (US$ 842 million) in Q1-2023

Credit growth
The net domestic advances grew by 19.3% year-on-year and 4.8% sequentially at
September 30, 2023. The retail loan portfolio grew by 21.4% year-on-year and 5.5%
sequentially, and comprised 54.3% of the total loan portfolio at September 30, 2023.
Including non-fund outstanding, the retail portfolio was 46.0% of the total portfolio at
September 30, 2023. The business banking portfolio grew by 30.3% year-on-year and
10.6% sequentially at September 30, 2023. The SME business, comprising borrowers with a
turnover of less than 250 crore (US$ 30 million), grew by 29.4% year-on-year and 7.2%
sequentially at September 30, 2023. The rural portfolio grew by 17.3% year- on-year and
3.5% sequentially at September 30, 2023. The domestic corporate portfolio grew by 15.3%
year-on-year and 3.1% sequentially at September 30, 2023.
Total advances increased by 18.3% year-on-year and 5.0% sequentially to
11,10,542crore (US$ 133.7 billion) at September 30, 2023.
Deposit growth
Total period-end deposits increased by 18.8% year-on-year and 4.5% sequentially to
12,94,742 crore (US$ 155.9 billion) at September 30, 2023. Period end term deposits
increased by 31.8% year-on-year and 9.2% sequentially to 7,67,112 crore (US$ 92.4
billion) at September 30, 2023. Average current account deposits increased by 14.0% year-
on-year in Q2-2024. Average savings account deposits increased by 4.5% year-
on-year in Q2-2024. With an addition of 174 branches during Q2-2024, the Bank had a
network of 6,248 branches and 16,927 ATMs and cash recycling machines at September 30,
2023.Asset quality
The gross NPA ratio declined to 2.48% at September 30, 2023 from 2.76% at June 30,
2023. The net NPA ratio declined to 0.43% at September 30, 2023 from 0.48% at June
30, 2023 and 0.61% at September 30, 2022. The net addition to gross NPAs, excluding
write-offs and sale, were 116 crore (US$ 14 million) in Q2-2024 compared to 1,807
crore (US$ 218 million) in Q1-2024. The gross NPA additions were 4,687 crore (US$564
million) in Q2-2024 compared to 5,318 crore (US$ 640 million) in Q1-2024.
Recoveries and upgrades of NPAs, excluding write-offs and sale, were 4,571 crore
(US$ 550 million) in Q2-2024 compared to 3,511 crore (US$ 423 million) in Q1-2024.The
Bank has written off gross NPAs amounting to 1,922 crore (US$ 231 million) in Q2-
2024. The provision coverage ratio on NPAs was 82.6% at September 30, 2023.
Excluding NPAs, the total fund based outstanding to all borrowers under resolution
as per the various extant regulations/guidelines declined to 3,536 crore (US$ 426 million)
or 0.3% of total advances at September 30, 2023 from 3,946 crore (US$ 475 million) at
June 30, 2023. The Bank holds provisions amounting to 1,107 crore (US$ 133 million)
against these borrowers under resolution. In addition, the Bank continues to hold
contingency provisions of 13,100 crore (US$ 1.6 billion) at September 30, 2023. The
loan and non-fund based outstanding to performing corporate and SME borrowers rated BB
and below was 4,789 crore (US$ 581 million) at September 30,
2023 from 4,276 crore (US$ 515 million) at June 30, 2023. The increase is due to the
upgrade of one borrower from non-performing status. The loan and non-fund based
outstanding of 4,789 crore (US$ 581 million) at September 30, 2023 includes 682
crore (US$ 82 million) to borrowers under resolution.
Capital adequacy
Including profits for the six months ended (H1-2024), the Bank’s total capital
adequacy ratio at September 30, 2023 was 17.59% and Tier-1 capital adequacy was16.86%
compared to the minimum regulatory requirements of 11.70% and 9.70% respectively.
Consolidated results
The consolidated profit after tax increased by 36.1% year-on-year to 10,896 crore
(US$ 1.3 billion) in Q2-2024 from 8,007 crore (US$ 964 million) in Q2-2023.
Consolidated total assets grew by 15.9% year-on-year to 21,24,850 crore (US$
255.9 billion) at September 30, 2023 from 18,33,154 crore (US$ 220.7 billion) at
September 30, 2022.
Key subsidiaries and associates

Value of New Business (VNB) of ICICI Prudential Life Insurance Company (ICICI
Life)decreased year-on-year by 7.1% to 1,015 crore (US$ 122 million) in H1-2024
compared to 1,092 crore (US$ 131 million) in H1-2023. The annualized premium
equivalent was 3,523 crore (US$ 424 million) in H1-2024 compared to 3,519 crore
(US$ 424 million) in H1-2023. The VNB margin was 28.8% in H1-2024 compared to32.0%
in FY2023. The profit after tax increased by 22.6% year-on-year to 244 crore (US$ 29
million) in Q2-2024 from 199 crore (US$ 24 million) in Q2-2023.

The Gross Direct Premium Income (GDPI) of ICICI Lombard General Insurance
Company (ICICI General) grew by 17.4% year-on-year to 6,086 crore (US$ 733 million)
in Q2-2024 from 5,185 crore (US$ 624 million) in Q2-2023. The combinedratio stood at
103.9% in Q2-2024 compared to 105.1% in Q2-2023. Excluding the impact of catastrophic
losses of 48 crore (US$ 6 million) in Q2-2024 and 28 crore in Q2-2023 (US$ 3
million), the combined ratio was 102.8% and 104.3% respectively. The profit after tax of
ICICI General was 577 crore (US$ 69 million) in Q2-2024 compared to 591 crore
(US$ 71 million) in Q2-2023. The profit after tax of Q2-2023 included reversal of tax
provisions of 128 crore (US$15 million).
The profit after tax of ICICI Prudential Asset Management Company, as per Ind AS,
grew by 23.5% year-on-year to 501 crore (US$ 60 million) in Q2-2024 from 406
crore (US$ 49 million) in Q2-2023.
The profit after tax of ICICI Securities, on a consolidated basis, as per Ind AS, was
424 crore (US$ 51 million) in Q2-2024 compared to 300 crore (US$ 36 million) in Q2-
2023.

Suggestion
After all these points, I just want to say that NPA is a big problem of banks. Due to this
crisis the NPA are also increased. That’s why all the banks are facing problems and ICICI
bank is top most in those banks, ICICI banks has a big exposure in that crisis as compare to
other banks. So banks have to take care of those banks. My recommendations are:
1. Strengthening provision norms and loan classification standards based onforward

lookingcriteria (like future cash flows) were implemented.
2. Through securitization they can reduce NPA
3. Speed of action- the speedy containment of systematic risk and the domestic credit
crunch problem with the injection of large public fund for bank recapitalization are critical
steps towards normalizing the financial system.
4. Strengthening legal system
5. Maintain required capital adequacy ratio as per basel 2 norms. That means now the
provision for NPL will be more. This may look a conservative approach. But it should be
implemented to reduce risk.
6. Modification in accounting system
7. Use the concept of credit derivative
8. Aligning of prudential norms with international standard.

CHAPTER VII
CONCLUSION

Conclusion
The issue of Non-Performing Assets (NPAs) in the financial sector has been an area of
concern for all economies and reduction in NPAs has become synonymous with functional
efficiency of financial intermediaries. Although NPAs are a balance sheet issue of
individual banks and financial institutions, it has wider macroeconomic implications. Itis
important that, if resolution strategies for recovery of dues from NPAs are not put in place
quickly and efficiently, these assets would deteriorate in value over time and only scrap
value would be realized at the end. It should, however, be kept in mind that NPA s are an
integral part of the business financial sector and the players are in as they are in the
business of taking risk and their earnings reflect the risk they take. They operate in an
environment, where there would be defaults as well as deterioration in portfolio value, as
market movements can never be predicted with certainty. It is in this context, that countries
have adopted regulatory measures and the guiding structure has been provided by the Basel
guidelines.
There are various reasons for assets turning non-performing and there can be alternative
resolution strategies. Identification of the reasons and timely action are the key to improved
profitability of financial sector intermediaries. In this context, the details of the CAMEL
model that RBI introduced for evaluating performance of banks and the needfor this arose
from the systemic generation of large volume of NPAs. CAMEL covers capital adequacy,
asset quality, management quality, earnings ability and liquidity.
A report is said to be incomplete until the conclusion part is not mentioned or declared. The
conclusion tells us what has been covered in the study and the method of study As per this
report I conclude the following things
• NPA s have been the biggest challenge to the banks.
• The banks in India whether private or public are trying to help the various sectors like
service, production and business
• They not only accept the deposits but also lend credit facilities tom the needy
• The banks are playing an important role in developing the economy of our country

 ICICI bank seems to be the best bank with regard to non performing assets as it is high when
The biggest problem that can be found is the conversion of performing assets into non
performing assets The wrong management of non-performing assets can hinder the
performance of the bankand affect the smooth functioning of bank
The NPAs are increasing year to year and are a potential threat to the banks.
If the performing assets are maintained properly, the profits of the bank can increase
drastically

CHAPTER VIII
BIBLIOGRAPHY

. Articles
Meenakshi Rajeev and Mahesh. HP( 2010) “Banking Sector Reforms and NPA: A Study of Indian
Commercial Banks”,
Working Paper, ISBN No.978-81-7791-108-4, The Institute for Social and Economic Change,
Bangalore, 2010.
Bhavani Prasad, G. and Veena, V.D. (2011) “NPAs in Indian Banking Sector- Trends and Issues”,
Journal of Banking Financial Services and Insurance Research, 1(9) Pp67-84.
Jaynal Ud-din Ahmed. (2011) “Management of Non-performing Assets of Commercial Banks:

The Evidence from Indian Banking Sector”, International Journal of Financial Management, 1 (3).
Veerakumar. K. (2012) “Non-performing Assets in Priority Sector: A Threat to Indian Scheduled

Commercial Banks”, International Research Journal of Finance and Economics,
. Yadav, M.S. (2011), “Impact of Non Performing Assets on Profitability and Productivity of Private
Sector Banks in
India”, AFBE Journal,
Sandeep and Parul Mital (2012) “Non-Performing Assets: Comparative Position of Private and Private
Sector
Banks in India”, International Journal of Business and Management .
Siraj.K.K and Prof.P Sundarsanan Pillai (2012) “A Study on the performance of Non-Performing Assets
(NPA’s)
of Indian Commercial Banking during Post Millennium Period”, International Journal of Business and
Management
Websites:
http://www.moneycontrol.com/stocks/top-companies-in-india/market-capitalisation-
bse/banks-private-sector.html
http://www.moneycontrol.com/competition/icicibank/comparison/ICI02
http://www.slideshare.net/JenBarr/recruitment-selection-process-presentation
http://www.scribd.com/doc/33993225/Recruitment-Process-of-ICICI-Bank
http://cscjournals.org/csc/manuscript/Journals/IJBRM/volume3/Issue1/IJBRM-64.pdf
http://www.marketing91.com/swot-analysis-icici-bank/
http://en.wikipedia.org/wiki/ICICI_Bank
http://www.theofficialboard.com/org-chart/icici-bank

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STUDY OF NON-PERFORMING ASSETS OF PRIVATE SECTOR BANKS WITH REFERENCE TO ICICI BANK

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 1

The Non-Performing Asset (NPA) analysis of ICICI Bank serves as a

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 2

Workers square measure being increasing however there's no result on the

If any advance or credit facility granted by bank to a receiver becomes non-

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 4

This report explores an empirical approach to the analysis of Non-Performing

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 5

Understanding ICICI Bank's NPA dynamics is crucial not only for

By conducting a thorough NPA analysis of ICICI Bank, this project seeks

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 6

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 7

A considerable amount of research has been done in the area of Non-

Siraj.K.K and Prof.P.Sundarsanan Pillai (2012) in their research study concluded

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 9

Conclusion of the Literature Review

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 10

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 11

Need for study:

Statement of the problem:

Broadly speaking, Non-Performing Asset (NPA) is defined as an advance, where

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 12

1. To study the impact of NPA on overall performance of selected banks.

2. To evaluate the efficiency in managing NPA between the selected banks.

3. To make suggestions for better NPA management in selected banks.

Methodology describes the research route to be followed, the instruments to be used,

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 13

Period of the study:

Limitations of the study:

1) Comparison is restricted to the one bank of private sector.

2) The study is based on secondary data as published in various private instituations of

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 14

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 15

The Non-Performing Asset (NPA) concept is restricted to loans, advances and

A NPA is an advance where payment of interest or repayment of instalment on

It is made by a bank or finance company on which repayments or interest payments

Due to the improvements in payment and settlement system, recovery climate, up

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 17

Some of the Non Performing Assets of bank examples are:

What is NPA in Banking?

Non-Performing Assets (NPA)

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 18

Non-Performing Assets (NPA) Work

An asset is categorized as falling below standard if it maintains its non-performing asset

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 20

(NPA)status for a period less than or equal to 12 months.

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 21

Provisioning is a method that banks employ to maintain a healthy book of accounts.

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 22

Provisioning norms for NPAS

In terms of RBI Circular No. 2004/261/DBOD BP.BC.99/21.04.048/2003-2004 dated

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 23

1. GNPA Ratio: It is the ratio of Gross NPA to Gross Advances

Net NPAs Gross NPAs-Provisions/Gross Advances - Provisions

NPA = 50,00,000 / 2,00,00,000 x 100= 25%

For non-performing assets, there are two possible scenarios:

Some of the causes of Non Performing Asset are as follows:

Economic Downturns: When the economy is in a downturn, businesses may experience

Changes in the Economic Environment: Changes in the economic environment, such as a

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 26

SANT RAWOOL MAHARAJ MAHAVIDYALAYA, KUDAL 27