ICICI Bank reported a 15.5% rise in fiscal first quarter net profit to Rs 12,768 crore, compared to Rs 11,059 crore a year ago.

The country’s second-largest private sector lender posted a 10.6% year-on-year rise in net interest income (NII) to Rs 21,635 crore in the June quarter from Rs 19,553 crore a year earlier.

Net interest margin (NIM) dropped to 4.34% from 4.41% in the preceding quarter and 4.36% a year ago.

“We expect the NIMs to compress a bit in the next quarter,” said ICICI Bank executive director Sandeep Batra.

Other income, excluding treasury gains, grew 13.7% to Rs 7,264 crore in the quarter ended June.

The bank’s asset quality improved, with gross non-performing assets (NPAs) declining to 1.67% in the quarter ended June, from 2.15% in the same quarter a year ago.

Net NPA ratio also fell to 0.41% from 0.43% in the earlier year. 

Total advances grew 11% to Rs 13.64 lakh crore as of 30 June 2025. Retail loans, which constitute about 52% of the bank’s total credit portfolio, grew by 6.9% on a YoY basis. The business banking portfolio grew 29.7%, while rural credit fell 0.4% YoY. 

High-risk segments like credit cards and personal loans saw a deliberate slowdown, growing by just 1% each, in contrast to the consistent 20% growth it would register in previous quarters. 

Batra said the moderation in growth was due to overall market trends and recalibrated credit norms.

Competitive pricing pressures also slowed down corporate loan growth. Batra said credit demand is expected to increase in the second half of the financial year.

The lender’s deposits grew 12.8% YoY to Rs 16.08 lakh crore. Average current account deposits increased by 11.2% YoY, and average savings account deposits by 7.6% YoY. 

The average CASA ratio stood at 38.7%.

The branch added 83 branches in the first quarter of FY26, taking the total network to 7,066 branches.

Capital adequacy ratio stood at 16.97%, with core capital over 16%. Batra said there is no immediate plan to raise capital.

The bank’s board approved the acquisition of ICICI Prudential Pension Funds Management Company Limited (ICICI PFM) from ICICI Prudential Life Insurance Company, making it a wholly owned subsidiary of the bank. 

ICICI PFM had total assets of Rs 592.6 million and a net loss of Rs 35.4 million in FY25.

The transaction involves a cash consideration of Rs 203.5 crore and is subject to approvals from the RBI and PFRDA.