Performance Review - Nine Months ended December 31, 2001

January 24, 2002




The Board of Directors of ICICI Limited (NYSE: IC) at its meeting held at Mumbai today, approved the audited accounts of ICICI for the nine months ended December 31, 2001 (Apr-Dec 2001). The Board of Directors of ICICI also approved an interim dividend of 55% i.e. Rs. 5.5 per share (excluding dividend tax) in respect of the financial year ending March 31, 2002. The Board has fixed February 16, 2002 as the Record Date for the purpose of payment of interim dividend. The Board approved the unaudited consolidated accounts under Indian GAAP and considered the unaudited consolidated US GAAP financial statements of ICICI for Apr-Dec 2001.

 
Results - Indian GAAP
 
The consolidated profit after tax of ICICI and its subsidiaries as per the unaudited consolidated Indian GAAP accounts increased 17.5% to Rs. 965 crore in Apr-Dec 2001 from Rs. 821 crore in the nine months ended December 31, 2000 (Apr-Dec 2000).
 
ICICI's profit before tax as per the audited unconsolidated Indian GAAP accounts increased 21.3% to Rs. 1,053 crore in Apr-Dec 2001 from Rs. 868 crore in Apr-Dec 2000. Provision for taxation increased to Rs. 189 crore (including Rs. 95 crore on account of deferred tax provision) in Apr-Dec 2001 from Rs. 74 crore in Apr-Dec 2000, due to the creation of deferred tax provision as per the accounting standard, which came into effect in the current year. After allowing for the deferred tax provision, the profit after tax increased 8.7% to Rs. 864 crore in Apr-Dec 2001 from Rs. 794 crore in Apr-Dec 2000.
 
The profit before tax increased 12.2% to Rs. 311 crore in the quarter ended December 31, 2001 (Q3-2002) from Rs. 278 crore in the quarter ended December 31, 2000 (Q3-2001). After allowing for the higher provision for tax, the profit after tax was Rs. 256 crore in Q3-2002 compared to Rs. 253 crore in Q3-2001.
 
Unaudited Consolidated Accounts under US GAAP
 
Net income after cumulative effect of change in accounting principle decreased marginally to Rs. 605 crore (US$ 125 million) in Apr-Dec 2001 from Rs. 608 crore (US$ 126 million) in Apr-Dec 2000. Net income includes an amount of Rs. 89 crore on account of the cumulative effect of change in accounting principle consequent to the application of FAS241 and 142 from April 1, 2001.
 
Progress on Merger of ICICI, ICICI Personal Financial Services and ICICI Capital Services with ICICI Bank (NYSE: IBN)
 
The progress on the merger has been in line with the expected timeframe. The Scheme of Amalgamation ('the Scheme") has been filed with the High Court of Judicature at Mumbai and the High Court of Gujarat at Ahmedabad. An Extraordinary General Meeting of ICICI Bank shareholders has been convened on January 25, 2002, and of ICICI shareholders on January 30, 2002, to consider the Scheme.
 
Discussions with RBI on the proposal for the merger and the merged entity's compliance with regulatory norms applicable to banks are in progress. Plans for integration of the operations of the four companies are also progressing satisfactorily. As provided in the Scheme, the Appointed Date for the merger shall be March 30, 2002, or the date from which RBI's approval becomes effective, whichever is later.
 
Asset Quality

ICICI's net NPA ratio was 5.3% at December 31, 2001 and net NPAs outstanding were Rs. 3,083 crore.

Capital Adequacy

ICICI's capital adequacy at December 31, 2001 was 14.6% including Tier2 capital adequacy of 9.3% and Tier-2 capital adequacy of 5.3% (including revaluation reserve as per RBI guidelines).

Rating Upgrade by Moody's

ICICI's long-term foreign currency rating has been upgraded from Ba2, the sovereign rating for India, to Ba1, i.e., one notch above the sovereign rating by the international credit rating agency Moody's Investor Service.

ICICI was the only Indian company and one of only two Asian banks / financial institutions to be considered for a rating upgrade beyond the country ceiling by Moody's. Consequent to this upgrade, ICICI has become the only Indian company to be assigned an international credit rating higher than the sovereign rating. ICICI is the first bank / financial institution in Asia and the second Asian company to be upgraded beyond the country ceiling by Moody's.

Summary Profit and Loss Statement (Indian GAAP Unconsolidated)

 

 

Rs. crore
 Q3 2001 Q3 2002 Apr-Dec 2000 Apr-Dec 2001 FY 2001
Fund based income
2,086
2,160
6,104
6,531
8,211
Less : Interest and depreciation charges
1,762
1,758
5,112
5,434
6,912
Net fund based income
324
402
992
1,097
1,299
Add : Fees and commissions
113
90
381
429
522
Net income from operations
437
492
1,373
1,526
1,821
Less : Operating expenses
88
87
255
248
337
Profit from operations
349
405
1,118
1,278
1,484
Less : Provisions and write-offs for loans & debentures
118
122
332
312
608
Profit before income from investments and other income
231
283
786
966
876
Add : Dividend income
6
26
68
120
108
Add: Net capital gain / (loss)
37
(4)
(3)
(48)
344
Add: Other income
4
6
17
15
62
Profit before accelerated provisioning and tax
278
311
868
1,053
1,390
Profit before tax
278
311
868
1,053
577
Less : Provision for tax1
25
55
74
189
40
Profit after tax
253
256
794
864
537
Less: Extraordinary items2
-
-
-
131
-
Add: Appropriated from capital reserves
-
-
-
131
-
Preference dividend
-
-
18
-
18
Profit to equity holders
253
256
776
864
519

 

Summary Balance Sheet (Indian GAAP Unconsolidated)

Rs. crore
 Dec 31, 2000 Dec 31, 2001 Growth %Mar 31, 2001
Net loans and debentures
54,325
54,896
1.1
56,002
Other Investments
3,971
6,165
55.3
4,404
Current assets
6,943
6,772
(2.5)
7,583
Leased assets
4,089
3,296
(19.4)
4,069
Other fixed assets
998
1,844
84.7
1,042
Miscellaneous expenditure
322
293
(9.1)
314
Total assets
70,648
73,266
3.7
73,414
Shareholders' equity and reserves
8,811
8,556
(2.9)
7,973
Of which : Equity capital
785
785
-
785
Preference capital
350
350
-
350
Borrowings
57,076
57,959
1.5
59,835
Current & other liabilities
4,411
6,401
45.1
5,256
Total liabilities
70,648
73,266
3.7
73,414

Note :

1.Provision for taxation for Apr-Dec 2001 includes deferred tax provision as per the accounting standard, which came into effect in the current year.

 
2.On October 16, RBI issued clarifications on the guidelines for the classification and valuation of investments. In compliance with the clarification, ICICI has effected changes in investment classification and the consequent impact on valuation. This resulted in an additional charge to the Revenue Account in Q2-2002 relating to the period upto March 31, 2001 amounting to Rs. 131 crore which is disclosed as an extraordinary item. As per the accounting policy followed by ICICI in earlier years, realised profit on sale of investments has been credited to the Revenue Account and transferred from the Revenue Account to the Capital Reserve account before arriving at the disposable profit. In accordance with its accounting policy, ICICI has utilised this component of the Capital Reserve to transfer to the Revenue Account an amount equivalent to the extraordinary charge referred to above.

 
3.Shareholders' equity and reserves includes revaluation reserve of Rs. 714 crore.

 

Forward-Looking Statements

Except for the historical information contained herein, statements in this release which contain words or phrases such as "will", "aim", "will likely result", "believe", "expect", "will continue", "anticipate", "estimate", "intend", "plan", "contemplate", "seek to", "future", "objective", "goal", "project", "should", "will pursue" and similar expressions or variations of such expressions may constitute "forward-looking statements". These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to our ability to successfully implement our strategy, future levels of non-performing and restructured loans, our growth and expansion, the adequacy of our allowance for credit losses, technological changes, investment income, cash flow projections, our exposure to market risks as well as other risks detailed in the reports filed by ICICI Limited with the Securities and Exchange Commission of the United States. ICICI undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof.

 

For further press queries please contact:
ICICI: Mr Charudatta Deshpande
Head Corporate Communications,
Tel: 022-26538208
Fax: 022 26531116
email: charudatta.deshpande@icicibank.com

For investor queries please call Rakesh Jha at 91-22-653 8902 or Anindya Banerjee at 91-22-653 7131 or email at ir@icici.com