ICICI Bank has things under control, says executive

Mumbai, Oct 1 (ANI): ICICI Bank has said that rumours being repeatedly circulated about its financial strength were baseless and malicious, saying the bank had a strong capital position.

India's central bank joined ICICI Bank to reassure investors and customers about the financial health of the country's second-largest bank, saying ICICI was well capitalised and has enough cash to meet depositor demands.

In the latest in a string of announcements, the bank has issued about its health in the past two weeks, Joint Managing Director of ICICI bank, Chandra Kochar said that ICICI's banking and non-banking units were well capitalised.

"Today, the Reserve Bank has also clarified that ICICI bank and our subsidiaries abroad are well and sufficiently capitalised. It has also clarified that we have enough liquidities to meet the requirements of our depositors," said Kochar.

Shares in ICICI surged as much as 8.7 per cent following the central bank statement, having earlier fallen 7.2 per cent to their lowest in more than two years.

The global credit crunch has caused a spate of bank collapses, mergers and nationalisations in the United States and Europe in recent weeks, heightening concerns about banks' exposure to toxic debt, rising bad loans and slowing growth.

"The rumours are quite baseless. I would like to assure all our stakeholders including depositors, investors and so on that we continue to have healthy capital position and healthy financial position. We'll be able to meet everybody's requirements and there is no cause to worry at all," Kochar added.

ICICI shares have lost more than 20 per cent in September and nearly 57 per cent so far in 2008.

In response to concerns about its exposure to markets and the financial health of the bank, ICICI has issued a number of statements since mid-September.

ICICI said earlier this month it had an exposure of about 81 million dollars to Lehman Brothers senior bonds and would raise provisions by 28 million dollars to cover half that.

On September 17, ICICI had issued a statement saying rumours that top management were selling shares were baseless and irresponsible.

Kochar and ICICI chief executive K.V. Kamath appeared on television on September 18 and 19 respectively, saying the bank was very healthy and had ample capital, after market worries had grown about ICICI's exposure to the credit turmoil.

On Monday, the bank said its UK unit had no exposure to the U.S. sub-prime credit and 98 per cent of its non-Indian investment was rated investment grade by rating agencies.

The unit had a total balance sheet size of 8.5 billion dollars, with 3.5 billion dollars constituting its non-India investment book, ICICI said. (ANI)