Date:01/10/2008 URL: http://www.thehindu.com/2008/10/01/stories/2008100156821700.htm

Business

ICICI Bank has sufficient liquidity: Reserve Bank

Special Correspondent

Apex bank monitoring developments and has arranged cash to bank

— PHOTO: PTI

ANXIOUS CUSTOMERS: People line up at an ICICI Bank ATM in Hyderabad on Tuesday for withdrawal and balance check, after reports of bank’s biggest losses on overseas investments.

MUMBAI: The Reserve Bank of India on Tuesday clarified that ICICI Bank had sufficient liquidity, including in its current account with the apex bank to meet the requirements of its depositors.

“The Reserve Bank of India is monitoring the developments and has arranged to provide adequate cash to ICICI Bank to meet the demands of its customers at its branches and ATMs,” the RBI stated. “ICICI Bank and its subsidiary banks abroad are well capitalised,” the RBI added.

Kamath allays fears

The financial position of ICICI Bank is sound and the rumours, repeatedly circulated in certain centres regarding the financial strength of the bank, are baseless and malicious, bank Managing Director and CEO K. V. Kamath said here on Tuesday.

“The absorption of the impact of current market conditions on investment portfolio valuation will not pose any challenge to the bank’s capital position,” Mr. Kamath said in a release.

The bank reiterated that: ICICI Bank has a strong capital position, having proactively raised Rs. 20,000 crore in June 2007, almost doubling its capital base. It has a networth of over Rs. 47,000 crore and a capital adequacy ratio of 13.4 per cent at June 30, 2008, as against the regulatory requirement of 9 per cent. “This is among the highest levels of capital adequacy in large Indian banks. This reflects the healthy capital position and comfortable level of leverage. Its banking and non-banking subsidiaries are also well-capitalised.”