We are downgrading our recommendation on ICICI Bank to Neutral
owing to a continued deterioration in its asset quality.
Nonetheless, the bank's strong second-quarter fiscal 2015 (ended
Sep 30) results largely benefited from a rise in revenues,
partially offset by elevated operating expenses and higher loan
loss provisions. We expect the company's increased dependence on
domestic loans, focus on improving fee income, a stable fund base
and market leadership in the insurance business to continue
generating synergies. However, a highly competitive operating
environment, continuously rising expenses and stringent regulatory
requirements will likely dampen ICICI Bank's financial performance.
Headquartered in Mumbai, India, ICICI Bank Limited was formed in
1955 at the initiative of the World Bank, the government of India
and Indian industry representatives. The principal objective was to
create a financial institution for providing medium-term and
long-term project financing to Indian businesses.
Until the late 1980s, ICICI Bank primarily focused its
activities on project finance, providing long-term funds to a
variety of industrial projects. With the liberalization of the
Indian financial sector in the 1990s, ICICI Bank transformed its
business from an institution offering only project finance to a
diversified provider which, along with its subsidiaries and other
group companies, provides a wide variety of financial products and
ICICI Bank is the largest private sector bank in India with
total assets of about INR6,111.43 billion ($98.97 billion) as of
Sep 30, 2014. The bank had a network of 3,815 branches and 11,739
ATMs as of the same date. ICICI Bank offers a wide range of banking
products and financial services to corporate and retail customers.
The company's subsidiaries operate in areas of investment banking,
life and non-life insurance, venture capital and asset
ICICI Bank currently has subsidiaries in the U.K., Russia and
Canada branches in the U.S., Singapore, Bahrain, Hong Kong, Sri
Lanka, Qatar and Dubai International Finance Centre and
representative offices in the UAE, China, South Africa, Bangladesh,
Thailand, Malaysia and Indonesia. The company's equity shares are
listed in India on the Bombay Stock Exchange and the National Stock
Exchange of India Ltd, and its American Depository Receipts (ADR)
are listed on the New York Stock Exchange (NYSE).
The bank has seven main business segments: Treasury, Wholesale
Banking, Life Insurance, Retail Banking, Other Banking, Other and
In Dec 2014, ICICI Bank split its stock in a ratio of 1:5 to
attract more retail investors to its ownership base.
ICICI Bank Limited - ADR (IBN): Read the Full
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