ICICI Bank: ICICI Bank leads the rebound rate charts, HDFC Bank follows

Mumbai: ICICI Bank outperformed peers such as HDFC Bank and Kotak Mahindra Bank on bounce rates, or skipped automatic monthly loan repayments, underscoring the growing benefits of a targeted asset-side risk reduction program built around quality retail advances.

HDFC Bank, considered the gold standard of prudential banking in the country, was the second best among private lenders.

Debit bounce rates tracked by the National Payments Corporation of India’s (NPCI) National Automated Clearing House (e-NACH) platform showed that ICICI Bank’s bounce rates fell by 20 percentage points. basis sequentially – at 18.1% – in January 2022.

One basis point is 0.01 percentage point.

HDFC Bank reported bounce rates of 20.3%, down 30 basis points quarter-on-quarter. IndusInd Bank and Kotak Mahindra Bank have the highest bounce rates among their peers, due to a higher share of auto and self-employed loans in the overall portfolio.

Kotak posted an 80 basis point quarter-over-quarter increase to 35.2%, compared to a 40 basis point quarter-over-quarter decline for the industry, to 29.6% for January 2022. The Bandhan Bank’s rebound rate at 52.5% saw the largest month-on-month decline of 165 bps QoQ.

For the industry, NACH debit rebound rates for February 2022, at 22.4% of total value, were the lowest since May 2019. In value, rebound rates for the month of February were only 100 basis points above the average levels of 21.5% seen during February 2018 to February 2020, analysis by Macquarie showed.

“We believe this indicates that asset quality should improve further, and we could see further reductions in non-performing retail loans in the March quarter,” said Suresh Ganapathy, managing partner at Macquarie Capital.

“Recent geopolitical tension and the corresponding impact on oil prices could cause concern in the retail segment, particularly in the rural and commercial vehicle segments, as high fuel prices are passed on to customers. .”

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