ICICI Bank Third Quarter Net Profit Falls 19 Percent, Bad Loans Rise

ICICI Bank Ltd, India's No.2 lender by assets, said its third-quarter net profit fell 19 percent as bad loans rose, although the profit decline was smaller than expected.

Net profit fell to 24.42 billion rupees ($360 million) for the three months to Dec. 31, from 30.18 billion rupees reported a year earlier, the Mumbai-based lender said on Tuesday.

That was higher than an average forecast of 21.7 billion rupees from a poll of 23 analysts, Thomson Reuters data shows.

Bad loans as a percentage of total loans rose to 7.91 percent at the end of December, from 6.82 percent at the end of September and 4.72 percent a year ago.

Indian banks have been hit hard by the government's shock cancellation in November of 86 percent of the country's currency in circulation. The move sent many institutions scrambling to replace the high-value banknotes and weighed on other activities such as lending.

The banking sector, facing a March deadline for the clean up of sour assets, also continues to make high provisions.

ICICI's net interest income for the December quarter fell to 53.63 billion rupees from 54.53 billion rupees a year earlier.

Ahead of the results, ICICI Bank shares closed down 0.7 percent in a Mumbai market that fell 0.8 percent.