ICICI Bank's retail mortgage book crosses Rs 2 lakh crore

MUMBAI: Second largest private sector lender ICICI Bank on Wednesday said its retail mortgage book has crossed the Rs 2 lakh crore mark recently and October witnessed the highest ever disbursements.

The bank said it had announced the portfolio touching the Rs 1 lakh crore mark in 2016 and expects the next one lakh crore addition to happen sooner.

Its Executive Director Anup Bagchi attributed the growth to digital processes, which aid a third of the loan processes at present, and a deeper network to touch nearly 2,000 markets across the country.

It can be noted that there have been concerns about the realty market since the onset of the pandemic, where home sales have nosedived during the lockdown and confidence about income generation impacts long-term bets by individuals.

Without sharing the absolute figures, Bagchi said the bank's disbursement touched a record high in September and it surpassed the same in October and added that a bulk of the growth has come from the non-metro areas.

He said account transfers, where a borrower shifts to a lower rate offering, have contributed materially to the growth but declined to specify the numbers and also added that the bank is gaining market share in the segment.

On the asset quality front, he declined to share the performance of the portfolio but added that it is not bad because banks like ICICI Bank generally go for the prime customers only and it is the mid or the sub-prime segment which borrows at high costs which may be impacted more from a NPA perspective.

Factors aiding home buys at present include affordability, Bagchi said, pointing out that there has been a 10-15 per cent correction in home prices and also the fact that lending rates are at a 15-year low.

Other factors like stamp duty reductions in states like Maharashtra have also helped, he said.

Demand from the self-employed segment has gone down lately because of the economic impact of the pandemic, while the more confident salaried segment continues to approach for loans, he said.

Without revealing the exact average ticket size and limiting himself to specify that it has fared as per the inflation over the last four years, Bagchi said the bank typically lends between Rs 30-35 lakh to borrowers, especially those buying their first house.

At present, a third of the loans are sourced and processed digitally and the bank expects the same to go up to three-fourths in a few years, Bagchi said.