Mumbai: ICICI Bank has asserted that its profitability trends, as reflected in Rs728 crore profit in the first quarter, would not be impacted by overseas subsidiaries for which mark-to-market provision of over Rs415 crore have been made till June.
“The impact of profit and loss, whatever, gets restricted to the UK bank...even if there is MTM, it does not impact the profitability of Indian bank,” ICICI Bank’s Joint Managing Director Chanda Kochhar told PTI.
Though she declined to talk about the quantum of MTM loss that the bank would make for the quarter ending September, Kochhar said, “as the market moves and spread moves up and down you too take some MTM. It does not mean there is deterioration in credit rating or anything”.
ICICI Bank had been the focus of rumours that cast doubt about its financial health, leading to depositors’ queues at a number of its branches, prompting the management to come out with strong statements earlier this week.
Asked if trend demonstrated in the first quarter with a net profit of over Rs700 crore would be continued despite any pressure that may be faced in overseas subsidiaries, Kochhar said, “In India absolutely and that was (Rs728 crore profit) was the first quarter performance. The profits in India does not get impacted at all.”
Buttressing her argument, CEO and Managing Director K V Kamath said even in the UK subsidiary’s exposure to the American market, that is witnessing an unprecedented financial turmoil impacting the global economy, is limited to just 18%.