IBN's Q3 Earnings Dip on Higher Provision & Expenses, NII Rises Y/Y

ICICI Bank Ltd.’s IBN profit after tax for the third-quarter fiscal 2026 (ended Dec. 31) was INR113.2 billion ($1.3 billion), down 4% from the prior-year quarter.

Results were hurt by a significant rise in provisions, higher operating expenses and treasury loss. However, rising net interest income (NII) and non-interest income, along with solid loan growth, were tailwinds.

IBN’s NII & Fee Income Improve, Expenses Rise

NII grew 7.7% year over year to INR219.3 billion ($2.4 billion). The net interest margin was 4.30%, up 5 basis points.

Non-interest income (excluding treasury) was INR75.3 billion ($837 million), growing 12.4% year over year. Fee income increased 6.3% to INR65.7 billion ($731 million).

In the reported quarter, IBN incurred a treasury loss of INR1.57 billion ($17 million), against the INR3.71 billion ($41 million) of treasury gains from the previous-year quarter.

Operating expenses were INR119.4 billion ($1.3 billion), up 13.2% year over year.

ICICI Bank’s Loans & Deposits Increase

As of Dec. 31, 2025, ICICI Bank’s total advances were INR14,661.5 billion ($163.1 billion), up 4.1% sequentially. Growth was primarily driven by a solid rise in domestic loans, retail loans, rural loans, business banking loans, domestic corporate and other loans.

Total deposits were INR16,596.1 billion ($184.6 billion), up 3.2% from the prior quarter.

IBN’s Credit Quality: Mixed Bag

As of Dec. 31, 2025, the net non-performing assets (NPA) ratio was 0.37%, which declined from 0.42% in the prior-year period. Recoveries and upgrades (excluding write-offs and sales) of NPAs were INR32.8 billion ($365 million) in the reported quarter.

In the reported quarter, there were net additions of INR20.7 billion ($231 million) to gross NPA. Gross NPA additions were INR53.6 billion ($596 million), while gross NPA written off was INR20.5 billion ($228 million).

Provisions (excluding provision for tax) were INR25.6 billion ($285 million) compared with INR12.3 billion ($136.8 million) from the prior-year quarter.

Capital Ratios Strong for ICICI Bank

In compliance with the Reserve Bank of India's guidelines on Basel III norms, ICICI Bank's total capital adequacy was 17.34%. Tier-1 capital adequacy was 16.46% as of Dec. 31, 2025. Both ratios were well above the minimum requirements.

Our Take on IBN

Mounting expenses due to ICICI Bank’s initiatives to digitize banking operations are expected to weigh on profitability in the coming quarters. Additionally, weak credit quality remains a near-term headwind. However, robust loan demand, efforts to digitize operations for bolstering fee income and decent economic growth are expected to offer some support.
 

ICICI Bank Limited Price, Consensus and EPS Surprise

ICICI Bank Limited price-consensus-eps-surprise-chart | ICICI Bank Limited Quote

ICICI Bank currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Release Dates of Other Foreign Banks

Deutsche Bank AG DB is scheduled to report fourth-quarter and full-year 2025 results on Jan. 29, 2026.

The Zacks Consensus Estimate for DB’s quarterly earnings has been unchanged at 72 cents per share over the past seven days. The figure implies a significant increase from the prior-year quarter.

Barclays BCS is scheduled to announce fourth-quarter and full-year 2025 results on Feb. 10, 2026.

The consensus estimate for BCS’ quarterly earnings has been unchanged at 42 cents per share over the past week. The figure implies an increase of 23.5% from the prior-year quarter.

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