ICICI Bank Limited
Annual Report 2024

Plain-text annual report

ICICI Bank is continually enhancing delivery capabilities to provide high quality customer experiences. While we continue to invest in value propositions in line with the evolving customer preferences regarding products and services, a compelling opportunity emerges to unlock value through simplified banking. We believe this will significantly enhance our capability to serve Customer 360° more effectively and provide a seamless banking experience. Recognising the imperative of simplifying, the Bank, over the years through a series of holistic initiatives, has implemented various measures focussing on decongesting processes, driving digital transformation and strengthening delivery channels to build a seamless and sustainable delivery framework. Continuing on this journey, the Bank is implementing these holistic initiatives across its entire organisational spectrum covering technology, operations, policies, organisation structure, franchise network and distribution channels. Process decongestion in our delivery framework is an ongoing effort with the objective of eliminating complexity, streamlining operations and building efficiencies to enhance customer satisfaction and strengthen operational resilience. The Bank is strategically focussed on identifying and addressing complexity in customer journeys such as simplifying onboarding processes, designing quick and easy transaction processing and providing seamless and secure digital services. The Bank has upgraded to a single enterprise-level customer relationship management platform with enhanced capabilities for servicing all the banking needs of the customers. A common onboarding framework has been created for both asset and liability products related to know your customer. The OpsServe initiative enables the Bank to consolidate operational activities at business centres and thereby releases capacity for better customer engagement. VServ enables the business centres and micro market teams to seek solutions to diverse customer requirements by reaching out to a central pool of internal subject matter experts. ICICI Bank’s digital transformation journey is centred around integrating technologies and digital platforms to deliver seamless, simple and secure experiences, enabling customers to navigate and avail banking services with ease and convenience. The Bank’s efforts continue to be guided by the three pillars of scalability, resilience and security across technology solutions. As the Bank progressed on digital journey, various digital innovations were launched over the years for seamless access to banking services such as customer- friendly payment and collection solutions, ‘Do-it- yourself’ transactions journeys and bespoke solutions. The Bank leverages public data infrastructure, digital integrations and data analytics, as the foundation for informed decision-making which have led to paperless and end-to-end digital journeys across several products Decongesting Processes Digital Transformation Process decongestion initiatives have improved our response and turnaround time thereby empowering our teams to effectively serve a diverse and vast base of identified customers in a simplified manner. CONTENTS Bank at a Glance 02 Financial Highlights 04 Message from the Chairman 06 Corporate Information 08 Message from the Wholetime Directors 09 Business Model 10 Our Business Strategy 14 Our Values 30 Fair to Customer, Fair to Bank 32 Risk Governance Framework 36 Responding to Risks and Opportunities 42 Materiality Assessment 44 Human Capital 52 Social and Relationship Capital 60 Environment and Sustainability 66 Board’s Report 71 Auditors’ Certificate on Corporate Governance 122 Management Discussion & Analysis 123 Key Financial Indicators: Last 10 Years 143 INTEGRATED REPORT STATUTORY REPORTS Independent Auditors’ Report – Financial Statements 144 Financial Statements of ICICI Bank Limited 154 Independent Auditors’ Report – Consolidated Financial Statements 249 Consolidated Financial Statements of ICICI Bank Limited and its Subsidiaries 268 Statement Pursuant to Section 129 of Companies Act, 2013 332 Basel Pillar 3 Disclosures 334 Glossary of Terms 335 FINANCIAL STATEMENTS To view this report online, please visit: https://www.icicibank.com/aboutus/annual.page The Bank has realigned its organisation structure to create and support an effective distribution network across micromarkets and ecosystems for seamless delivery of products and services to its growing customer base in a simplified manner. Business centre coverage has been optimised in key micromarkets for better customer reach for sales and service. Product-centric teams have been re-aligned to geographically cohesive customer-centric teams for greater synergy and for meeting the diverse banking needs of the customer. We have further empowered our on-ground teams by adding leadership personnel closer to the customer for faster decision-making to impart superior customer experience. With the aim to take the entire bank to the customer and serve the entire value chain, customer ecosystem propositions were launched and supported by industry-specific STACKS as well as digital platforms, which provide bespoke solutions to meet specific needs of the entire ecosystems. The realignment of delivery channels has redefined customer engagement opportunities in a meaningful and simplified manner at various customer touchpoints and to bring the delivery closer to the customer. The principles of ‘Fair to Customer, Fair to Bank’, ‘One Bank, One Team’ and ‘Return of Capital’ will continue to guide our operations. The Bank continues to lay strong emphasis on serving customers with simplicity, transparency and offering suitable banking solutions to build trust for long-term sustainable growth. Delivery Channels with comprehensive value propositions for customers. Pre-approved offers across product segments leverage the digital capabilities for delivering right-sized offerings in an easy and seamless manner. The digital transformation has consolidated the customer journeys in a simplified manner thereby providing customer- friendly and personalised experiences. BANK AT A GLANCE *During fiscal 2024; others at March 31, 2024 `408.88 billion Profit After Tax* `544.79 billion Profit Before Tax Excluding Treasury* `442.56 billion Consolidated Profit After Tax* 4.53% Net Interest Margin* `18,715.15 billion Standalone Total Assets `14,128.25 billion Total Deposits `18,715.15 billion Standalone Total Assets `11,844.06 billion Total Advances 16.33% Capital Adequacy Ratio 02 | Annual Report 2023-24 Presence across the country The Bank has a network of 6,523 business centres, 17,190 ATMs and Cash Recycling Machines, and 570 Insta Banking Kiosks across the country. iLens platform for mortgages, enhanced to personal loan and education loan iLens, ICICI Bank’s lending solution, is an industry-first end-to-end digital lending platform covering the entire loan life cycle. It is a single interface that allows employees, third party agencies and sourcing channels to collaborate to facilitate faster turnaround of loan applications, greater transparency of loan status and an enriched customer experience. In addition to mortgages, the platform is now extended to personal and education loan offerings. More than 30 million users on iMobile Pay iMobile Pay, ICICI Bank’s mobile banking application, has more than 30 million users. The total value of transactions done through this app stood at close to `11,000 billion in fiscal 2024. Over 4,600 APIs The Bank has over 4,600 APIs to manage more than 160 million financial and non-financial transactions per day. 35% of total energy consumed is from renewable sources The share of renewable energy in total energy consumption from grid and on-site solar increased to 35% in fiscal 2024 as compared to 9% in the previous year. Over 70% digital trade transactions Of all the eligible trade transactions processed through the Bank, over 70% were done digitally. `12 billion committed to Tata Memorial Centre ICICI Bank has committed a contribution of `12 billion to Tata Memorial Centre. The money will be utilised for setting up cancer care facilities in Maharashtra, Punjab and Andhra Pradesh. 34% y-o-y increase in UPI P2M transaction The volume and value of UPI person-to- merchant (P2M) transactions increased by 34.4% and 76.4% respectively year-on-year in fiscal 2024. 16 million cards in force Over 16 million credit cards in force as at March 31, 2024. Overall credit card spends grew by 28% year-on-year in fiscal 2024. 22% growth in volume of transactions on InstaBIZ The volume of financial transactions on InstaBIZ, the Bank’s one-stop solution for all banking needs of business banking customers, grew by 22% in fiscal 2024. Annual Report 2023-24 | 03 TOTAL ADVANCES March 2020 March 2021 March 2022 March 2023 March 2024 7,709.69 9,325.22 10,645.72 14,128.25 11,808.41 1,022.27 4,231.51 2,455.91 1,361.70 5,008.99 2,954.53 1,584.80 5,461.35 3,599.57 TOTAL DEPOSITS Current Account (` in billion) Savings Account (` in billion) Term Deposit (` in billion) Total (` in billion) March 2020 March 2021 March 2022 March 2023 March 2024 6,452.90 11,844.06 10,196.38 8,590.20 7,337.29 8.4% 2.8% 3.3% 4.8% 5.1% 28.4% 24.4% 26.3% 27.2% 28.2% 7.9% 7.1% 5.1% 50.3% 56.3% 54.7% 52.9% 51.8% 8.8% 4.1% 8.6% 8.6% 8.9% 6.2% 9.8% Retail Business Banking Domestic Corporate & SME Overseas Rural Loans Total (` in billion) 4,023.00 3,797.76 8,169.53 6,395.79 1,935.72 1,614.86 March 2020 March 2021 March 2022 March 2023 March 2024 NET WORTH 1,165.04 1,475.09 1,705.12 2,007.16 2,383.99 Net Worth (Equity Share Capital, Employees Stock Options Outstanding, Reserves and Surplus) (` in billion) 15.60% 18.35% 18.06% 14.72% 0.73% 1.39% 16.11% 1.06% 19.12% 0.81% 19.16% 18.34% 16.33% March 2020 March 2021 March 2022 March 2023 March 2024 CAPITAL ADEQUACY 17.60% 13.39% 16.80% 17.60% 17.12% 15.60% Tier I Tier II Common Equity Tier 1 Total FINANCIAL HIGHLIGHTS 0.74% 04 | Annual Report 2023-24 79.31 127.55 161.93 151.37 233.39 297.06 318.96 424.73 408.88 544.79 March 2020 FY2020 March 2021 FY2021 March 2022 FY2022 March 2023 FY2023 March 2024 FY2024 332.67 75.7% 389.89 77.7% 474.66 79.2% 621.29 82.8% 743.06 80.3% 3.73% 3.69% 3.96% 4.48% 4.53% Provision Coverage Ratio (provisions on gross NPAs as a percentage of gross NPAs) FY2020 FY2020 FY2021 FY2021 FY2022 FY2022 FY2023 FY2023 FY2024 FY2024 Standalone Net Profit (` in billion) Net Interest Income (NII) (` in billion) Net Interest Margin (NIM) Profit Before Tax (Excluding Treasury Income) (` in billion) 1.4% 1.1% 0.8% 0.5% 0.4% Net NPA Ratio (based on customer assets) STANDALONE NET PROFIT PROVISION COVERAGE RATIO & NET NPA RATIO NII & NIM PROFIT BEFORE TAX (EXCLUDING TREASURY INCOME) FINANCIAL HIGHLIGHTS Annual Report 2023-24 | 05 Integrated Report Statutory Reports Financial Statements The Indian economy continued to display resilience and growth in the year gone by. Industrial and services sector activity was strong on the back of domestic demand. Substantial public investment in infrastructure provided an impetus to growth. At the same time, the fiscal position continued to benefit from robust tax collections. The banking system has become significantly stronger in recent years and is well-placed to support the country’s growth. The regulatory framework continued to evolve with a focus on high standards of compliance, operational resilience and a proactive approach towards addressing potential risks. During fiscal 2024, the Bank continued to focus on growth in risk-calibrated profits, pursuing opportunities across business segments and geographies, within the guardrails of risk and compliance. The growth in business was broad-based underpinned by the Bank’s focus on micromarkets and ecosystems. The Bank continued to enhance its liability franchise and focus on optimal asset-liability management. Enhancement of delivery systems, with emphasis on resilience, efficiency and customer experience, continue to be focus areas for the Bank. The Bank’s asset quality is healthy and capital levels are well above regulatory requirements. The strong balance sheet, well-recognised brand and extensive franchise provide the foundation for the Bank’s growth in the coming years. The Bank is taking several initiatives towards simplifying the banking experience for its customers. The Bank has adopted a customer-centric approach, with the prime objective of serving all their banking needs in a holistic manner. The principle of ‘Fair to Customer, Fair to Bank’ underpins our strategy, aiming to build trust with our customers for long-term value creation and thereby growing the Bank’s share of the business opportunity. Integrity, transparency and fairness continue to be core to serving our customers and each employee is expected to uphold these values while representing the organisation. Girish Chandra Chaturvedi Chairman During fiscal 2024, the Bank continued to focus on growth in risk-calibrated profits, pursuing opportunities across business segments and geographies, within the guardrails of risk and compliance. The growth in business was broad-based underpinned by the Bank’s focus on micromarkets and ecosystems. MESSAGE FROM THE CHAIRMAN 06 | Annual Report 2023-24 The rapid increase in adoption of digital modes of banking in recent years has significantly increased the requirements on operational resilience and effective management of the risks associated with technology in banking. The Bank continues to strengthen the technology infrastructure based on the key pillars of scalability, resilience and security. Information security is of paramount importance and is considered to be an integral part of our technology implementation. The Bank has taken a range of initiatives towards revamping digital platforms and enhancing its core applications to cater to higher business volumes. The Bank has laid strong emphasis on continuous strengthening of operational resilience for seamless delivery of services and customer delight. During fiscal 2024, the Bank continued to make progress on its sustainability journey. The achievements in fiscal 2024 strengthened the Bank’s commitment to environmental, social and governance (ESG) aspects of its business. The Bank achieved an increase in the proportion of renewable sources in its total energy consumption, resulting in a decline in Scope 2 emissions. The Bank has now set a target of becoming carbon neutral in Scope 1 and Scope 2 emissions by fiscal 2032. The Bank also continued to work towards integrating climate change related risks in its risk management. Building an understanding of sustainability and ESG among the employees is a key area of focus, with a view to embedding ESG in all relevant areas of the Bank’s operations. The Bank has devoted significant resources to Corporate Social Responsibility (CSR) activities. The CSR initiatives span the thematic areas of healthcare, environment, supporting livelihood and community development. These include both large-scale projects as well as granular initiatives under the thematic areas spread across the country. Sustainability and scalability of projects are key pillars. The Bank estimates that its CSR initiatives have benefited over 12 million people thus far. The Board is committed to maintaining the highest standard of corporate governance and will continue to review and strengthen these practices. The Board continuously endeavours to strengthen various policies and frameworks, and maintain oversight over risk management, audit and compliance with the laws of the land through its various Committees. The Board has laid strong emphasis on building an effective risk and compliance culture in the Bank. Ensuring organisational resilience and responsiveness to the evolving technological developments and cybersecurity are key focus areas. The Board will continue to maintain integrity, fairness and transparency in our engagement with all our stakeholders. Looking ahead, while global geopolitical and economic conditions continue to remain uncertain, the prospects for the Indian economy are strong. The country’s world-leading public digital infrastructure, its vast human capital, strong base of entrepreneurship, the manufacturing opportunity, infrastructure and industrial investment potential and the robust regulatory framework can support healthy growth for several years. The Bank is well-poised to focus on profitable business opportunities with a focus on operational resilience and balancing risks and rewards. We would like to thank all our stakeholders and look forward to your continued support. As I demit office as the Chairman of the Board, I would like to thank my colleagues on the Board, the management team and all stakeholders for their support. The progress that the Bank has made on various fronts, strengthening its franchise and its balance sheet, is commendable. I am sure the Bank will build on this foundation to create sustainable value for its stakeholders. I take this opportunity to welcome Mr. P. K. Sinha as the new Chairman of the Board and wish him, the Board and the Bank all the very best in the years to come. With best wishes, Girish Chandra Chaturvedi Chairman June 30, 2024 MESSAGE FROM THE CHAIRMAN Annual Report 2023-24 | 07 Integrated Report Statutory Reports Financial Statements CORPORATE INFORMATION BOARD MEMBERS Pradeep Kumar Sinha Non-Executive (part-time) Chairman** Sandeep Bakhshi Managing Director & CEO Hari L. Mundra Independent Director B. Sriram Independent Director S. Madhavan Independent Director Uday Chitale Independent Director Neelam Dhawan Independent Director Rakesh Jha Executive Director Sandeep Batra Executive Director Ajay Kumar Gupta Executive Director Vibha Paul Rishi Independent Director KEY PERSONNEL Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary BOARD COMMITTEES Audit Committee Uday Chitale (C) S. Madhavan Radhakrishnan Nair Rohit Bhasin Board Governance, Remuneration & Nomination Committee Neelam Dhawan (C) Pradeep Kumar Sinha B. Sriram Corporate Social Responsibility Committee Pradeep Kumar Sinha (C) Radhakrishnan Nair Uday Chitale Vibha Paul Rishi Rakesh Jha Credit Committee Sandeep Bakhshi (C) Hari L. Mundra B. Sriram Rakesh Jha Customer Service Committee Vibha Paul Rishi (C) Hari L. Mundra Sandeep Bakhshi Rakesh Jha Fraud Monitoring Committee Radhakrishnan Nair (C) S. Madhavan Neelam Dhawan Sandeep Bakhshi Rakesh Jha Information Technology Strategy Committee B. Sriram (C) Neelam Dhawan Sandeep Batra Ajay Kumar Gupta Risk Committee S. Madhavan (C) Pradeep Kumar Sinha Vibha Paul Rishi Rohit Bhasin Sandeep Batra Stakeholders Relationship Committee Hari L. Mundra (C) Uday Chitale Sandeep Batra Radhakrishnan Nair Independent Director Girish Chandra Chaturvedi Non-Executive (part-time) Chairman* Rohit Bhasin Independent Director*** As on July 27, 2024 * Up to June 30, 2024 ** With effect from July 1, 2024 *** With effect from July 26, 2024 (C) Chairperson 08 | Annual Report 2023-24 MESSAGE FROM THE WHOLETIME DIRECTORS At ICICI Bank, our focus remains on risk-calibrated profitable growth by maintaining high standards of governance, deepening our coverage and enhancing our delivery capabilities. Furthermore, we continue to cultivate a culture where every employee serves customers with humility and upholds the values of brand ICICI. We aim to be a trusted financial services provider of choice for our customers and deliver consistent, predictable returns to our shareholders. In fiscal 2024, we remained committed to integrating sustainable practices into the Bank’s operations. Encouraged by our steady progress, we have set a target of becoming carbon neutral in Scope 1 and Scope 2 emissions by fiscal 2032. Our efforts through ICICI Foundation for Inclusive Growth, our CSR arm, in providing affordable healthcare, creating rural livelihoods, and supporting societal development have made a difference to over 12.8 million lives across the country to date. Sandeep Batra Executive Director Sandeep Bakhshi Managing Director & CEO Our priority is to simplify banking for our customers and deliver superior experience across all ecosystems, micromarkets and customer segments. Our 360º customer-centric service approach is anchored on core values of trust, integrity and transparency. We are making continuous efforts to strengthen our service digital capabilities and enhance our delivery systems underpinned by a focus on operational resilience. The Bank is committed to fostering a strong risk and compliance culture to ensure a balance of risk and rewards for delivering long-term sustainable outcomes. We see exciting opportunities arising from the Indian economy and its global linkages and are committed to supporting this transformative journey. Driven by the principles of ‘One Bank, One Team’ along with ‘Fair to Customer, Fair to Bank’ and ‘Return of Capital’, our focus will be growing in a prudent and responsible manner. We remain committed to high standards of governance, and becoming a trusted financial partner for our customers while creating value for all stakeholders. We continue to strengthen our 360° customer-centric approach as ‘One Bank, One Team’, aiming to deliver value to our customers in line with our ‘Fair to Customer, Fair to Bank’ approach. Building trust-based long-term relationships with customers is core to our strategy for sustainable growth. In fiscal 2024, we focussed on deepening our presence and harnessing business opportunities across ecosystems and micromarkets in a unified manner by leveraging our business centres, digital channels and partnerships. We have further empowered our frontline teams with enablers for enhancing customer engagement and providing seamless services. We continued to enhance our services and solutions such as onboarding new products on our iLens platform, enriching the export-import journey on Trade Online and technology integrations with customers to serve supply chain ecosystems. We believe our initiatives should be underpinned by simplicity and should enrich the customer experience. Rakesh Jha Executive Director Offering high-quality banking services with simplicity and reliability is our key priority as we seek to deliver customer delight while ensuring resiliency of our operations. We continue to focus on enhancing delivery systems and simplifying processes for better outcomes. The Bank’s delivery framework endeavours to take complete ownership of the customer’s needs, right from onboarding to fulfilling various transaction needs, through a frictionless journey. We continued our approach of onboarding right counterparties including our partners and service providers. We continue to review our credit policies and credit delivery for offering right product propositions to our customers and deliver in a seamless manner. By leveraging data analytics, public digital infrastructure and digital capabilities, we strive to provide customers with a transparent and best-in-class banking experience. We have laid strong emphasis on continuously strengthening our operational resilience for seamless delivery of services to customers. As we continue to grow our business, we remain invested towards strengthening our delivery systems and technology platforms to sustain scalability, security and resilience. Ajay Kumar Gupta Executive Director Annual Report 2023-24 | 09 Integrated Report Statutory Reports Financial Statements BUSINESS MODEL CAPITALS VISION To be the trusted financial services provider of choice for our customers, thereby creating sustainable value for our stakeholders. FINANCIAL CAPITAL HUMAN CAPITAL INTELLECTUAL CAPITAL MANUFACTURED CAPITAL SOCIAL AND RELATIONSHIP CAPITAL NATURAL CAPITAL Our ability to maintain a strong balance sheet and enable business continuity, sustained growth, and shareholder returns. For further details, please refer to the Management Discussion and Analysis section on page 123 Our competent workforce with diverse skill sets and valuable experience. For further details, please refer to the section on Human Capital on page 52 Our ability to stay innovative and develop products and services that provide superior experiences to our customers. For further details, please refer to the section on Our Business Strategy on page 14 Our technology architecture along with the network of branches, ATMs, cash recycler machines and digital channels facilitates seamless delivery of services to customers. For further details, please refer to the section on Our Business Strategy on page 19 Our commitment towards social empowerment and a financial ecosystem accessible to all. For further details, please refer to the section on Social and Relationship Capital on page 60 Our focus on minimising the impact on natural resources through our operations and business. For further details, please refer to the section on Environment and Sustainability on page 66 10 | Annual Report 2023-24 Co mp lia nc e wit h Co ns cie nc e Ret urn of Ca pit al On e Ba nk, O ne Te am Fai r to C us to me r, Fai r t o B an k Agi le Ris k Ma na ge me nt BUSINESS MODEL MISSION To grow our risk-calibrated core operating profit by: • Delivering products and services that create value for customers • Bringing together all our capabilities to seamlessly meet customer needs • Conducting our business within well-defined risk tolerance levels Co mp lia nc e Re pu ta tio n Le ga l Cy be r In fo rm ati on Op er ati on al Liq ui dit y Ma rk et Cr ed it Te ch no lo gy Provide credit to support consumption and economic activity Enable financial inclusion Facilitate payments and transactions Enable wealth creation and management Provide savings products Ri sk a nd Co m pli an ce C ul tu re Pr oc es s De co ng es tio n Le ve ra gin g Te ch no lo gy Cr os s- fu nc tio na l Pa rt ne rs hi ps Co lla bo ra ti on Ec os ys te ms Mi cr o ma rk et s Cu st om er -C en tri cit y Annual Report 2023-24 | 11 Integrated Report Statutory Reports Financial Statements BUSINESS MODEL FINANCIAL CAPITAL HUMAN CAPITAL INTELLECTUAL CAPITAL MANUFACTURED CAPITAL SOCIAL AND RELATIONSHIP CAPITAL NATURAL CAPITAL VALUE DRIVERS • Ensure a resilient balance sheet and strong capital levels • Maintain robust funding profile • Continue to strengthen portfolio quality • Create value for shareholders • Guided by ‘One Bank, One Team’ • Enabling cross-functional collaboration • Job rotation • Continuous skill training and capability building • Employee engagement • Transforming Bank to BankTech • Early adoption of emerging technologies enabling innovation • Partnership with fintechs • Decongesting processes and improving customer experience • A combination of physical and digital channels enabling seamless service delivery • Strengthening digital capabilities for cost efficiency, process efficiency and enhancing customer experience • Focus on cybersecurity, data privacy and operational resiliency • Core and supporting IT systems that are responsive and scalable • Engagement with customers, society and other stakeholders • Participating in development efforts through the ICICI Foundation for Inclusive Growth • Empowering rural women entrepreneurs • Financial inclusion • Supporting environment-friendly projects, subject to appropriate risk‑return assessment • Efficient energy management in the Bank’s operations • Use of renewable energy • Environment-friendly initiatives 12 | Annual Report 2023-24 BUSINESS MODEL OUTPUTS OUTCOMES Profit After Tax: `408.88 billion in fiscal 2024 Profit Before Tax Excluding Treasury: `544.79 billion in fiscal 2024 Loans and Advances: `11,844.06 billion at March 31, 2024 Deposits: `14,128.25 billion at March 31, 2024 FINANCIAL CAPITAL • Profit before tax excluding treasury grew by 28.3% and profit after tax by 28.2% on y-o-y basis • Granular portfolio mix with 67.7% of corporate loans to entities internally rated A and above • Net NPA ratio decreased from 0.48% at March 31, 2023 to 0.42% at March 31, 2024 • Common Equity Tier 1 ratio of 15.60% at March 31, 2024 • Consolidated return on equity of 18.9% in fiscal 2024 HUMAN CAPITAL • Frontline teams reorganised and empowered for enabling 360º customer engagement and leveraging local opportunities • Women comprised 32% of total employees at March 31, 2024 • Average person learning days of 12 days in fiscal 2024 • Diversity, equity and inclusion policy and human rights policy established to promote a culture of no discrimination • Strong industry-academia engagement to create bankers with diverse skills INTELLECTUAL CAPITAL • iLens platform for mortgages, enhanced to personal loan and education loan offerings during fiscal 2024 • Value proposition launched for cross-border trade solutions in fiscal 2024; over 20 industry-specific STACKS developed providing bespoke solutions to customers • Around five million Amazon Pay credit cards issued till March 31, 2024 • More than 4,600 APIs of which 2,600 APIs for retail banking and 200 APIs for corporate banking; over 160 million financial and non-financial transactions per day MANUFACTURED CAPITAL • Several initiatives taken towards enhancing delivery systems and simplifying processes with a focus on delivering customer delight • Empowered business centres for enabling Customer 360º • 623 business centres added during the year • 13 exclusive business centres for ecosystem banking across Mumbai, National Capital Region (NCR) and Kolkata • No material incidents of security breaches or data loss during fiscal 2024 SOCIAL AND RELATIONSHIP CAPITAL • The ‘Orange Book’ continuously educates customers about various topics such as power of compounding, tax saving, will writing, succession planning and emerging frauds • Improvement in the Bank’s Net Promoter Score continued across products and services • `5.19 billion spent towards corporate social responsibility initiatives; focussed on healthcare, environment and ecology, sustainable livelihood and societal development; 12.8 million beneficiaries through CSR initiatives till date • Commitment of `12.00 billion to Tata Memorial Centre for expanding cancer care facilities at three locations • Continuing support to self-help groups and promoting women entrepreneurship • ISO 45001:2018 certification for Occupational Health and Safety Management at 18 large offices with total occupancy of more than 30,000 employees NATURAL CAPITAL • Outstanding portfolio of `685.28 billion towards sustainable sector, of which 28.3% was green financing to sectors like renewable energy, electric vehicles, green buildings and water and waste management at March 31, 2024 • 32% of Bank’s premises were Indian Green Building Council certified at March 31, 2024 • Proportion of renewable energy in total energy consumption from the grid and on-site solar increased to 35% in fiscal 2024 from 9% in fiscal 2023 Annual Report 2023-24 | 13 Integrated Report Statutory Reports Financial Statements 14 | Annual Report 2023-24 OUR BUSINESS STRATEGY Strengthening our operational resilience and enhancing delivery systems to achieve sustainable growth. During fiscal 2024, the Bank continued to advance in terms of profitability, its franchise as well as building capabilities for sustainable and resilient growth. On the back of core principles of ‘Return of Capital’, ‘Fair to Customer, Fair to Bank’ and ‘One Bank, One Team’, the Bank has sought to maintain a strong culture while pursuing its business objectives. Emphasis was laid on deepening coverage and enhancing delivery capabilities while continuing the focus on appropriate risk and reward. The Bank’s strategic objective of risk-calibrated growth in profit before tax excluding treasury continued to drive businesses, anchored by a 360º customer-centric approach and exploring opportunities across ecosystems and micromarkets. The Bank’s profit before tax excluding treasury grew by 28.3% year-on-year during fiscal 2024 to `544.79 billion. The Bank saw broad- based loan growth across segments with a growth of 16.8% year-on-year in the domestic loan portfolio to `11,509.55 billion. The Bank continued to maintain its competitive advantage in cost of funds while enhancing the liability franchise and maintaining a stable and healthy funding profile. During fiscal 2024, the Bank continued to maintain a strong balance sheet with adequate liquidity, prudent provisioning and healthy capital adequacy. Building trust with all stakeholders is critical to the Bank’s strategic objectives. The Bank re-iterates its focus on a strong risk and compliance culture that underpins dealings with our customers. We believe in serving our customers with integrity and transparency while offering suitable banking solutions. At the same time, the approach of right counterparty selection has provided an impetus to resilient growth in business. Remaining agile and aligning the organisation structure to evolving opportunities has helped in better serving our customers and exploring the potential across micromarkets and ecosystems. The Bank has laid strong emphasis on continuously strengthening its operational resilience for seamless delivery of services to customers. It is also evolving in line with the growing and emerging requirements of our customers. We continue to focus on simplifying banking services to deliver an improved customer experience and enhance advocacy. As we continue to enhance our digital capabilities, which are integral to our operations, we remain invested towards strengthening our delivery systems, technology platforms and cybersecurity to sustain scalability and resilience. 360 o Customer- centric Approach Focus on Micromarkets Fair to Customer, Fair to Bank Return of Capital One Bank, One Team Focus on Ecosystems Collaboration and External Partnerships Bank to BankTech Leveraging Technology and Digital Process Decongestion and Operational Flexibility Risk and Compliance Culture Maximising Profit Before Tax1 1 Excluding treasury Our efforts continue to be guided by our seven strategic value drivers and three key principles Annual Report 2023-24 | 15 Integrated Report Statutory Reports Financial Statements OUR BUSINESS STRATEGY Taking Entire Bank to the Customer Customer Expectations Approach Execution Trust & Partnership Reputed Brand & Quality Service Customer Convenience Customer Delight Right Counterparties Customer 360° Simplify I. APPROACH TO CUSTOMERS a. Focus on Customer 360º Customer-centricity is core to our strategy in growing our business and delivering customer delight. We have sought to adopt a solution-oriented approach in meeting financial needs of a customer and designing solutions that are product and segment agnostic. We seek to take the entire bank to the customer and offer solutions that are holistic in nature and build trust that translates into a long-term relationship with our customers. Delivering on the Customer 360º approach also requires enhancing delivery systems and simplifying processes for better outcomes. The Bank is continuously making efforts to streamline processes and leverage technology-based solutions for more meaningful customer engagement. Underscored by strong governance, controls and risk management, the endeavour of the Bank is to deliver products and services to customers in an appropriate manner. As part of our Customer 360º approach, the Bank continues to strengthen its franchise in terms of enabling constructive customer engagement, decision-making and accountability. This has led to transformation of branches into customer-oriented business centres. The Bank's objective is to serve the entire value chain of corporate clients including their channel partners, dealers, vendors, employees and other stakeholders, by taking the full bank to the customer. The Bank’s commitment is to deliver holistic solutions and provide seamless digital customer journeys. b. Focus on Micromarkets ICICI Bank continues to uphold its customer-centric ethos through an in-depth analysis of micromarkets, leveraging data analytics and market intelligence. This comprehensive understanding enables the Bank to deliver tailored solutions to customers across various segments, empowering frontline teams to devise localised strategies with tailored propositions. Micromarket insights allow the Bank to focus on aligned distribution and relevant delivery models. These insights are utilised in optimising business centre locations, ATM placements and build distribution networks to better align with customer needs and market dynamics thereby driving value creation through appropriate planning, resource allocation, channel alignment and marketing in every market the Bank serves. Business Centres Micromarket & Ecosystem Digital Solutions 16 | Annual Report 2023-24 Micromarket 6,523 Business Centres 17,190 ATMs/Cash Recycling Machines 570 Insta Banking Kiosks ICICI Bank’s Network at March 31, 2024: OUR BUSINESS STRATEGY Focus on High Potential Markets Intensified Leadership Presence Asset Distribution Aligned with Business Centres Credit Business Centres Co-located in Business Centres The localised branding, resourcing, capacity building and service offerings further enhance customer engagement and satisfaction, while focussed marketing campaigns cater to specific segments, complemented by alliances with relevant partners in each micromarket. Moreover, our commitment to innovation is exemplified through the implementation of Virtual Relationship Management (VRM), an AI-powered platform facilitating efficient and personalised customer interactions with the help of service and solution-based engagement. This cloud- based platform empowers our relationship managers to deliver meaningful solutions and services, thereby enriching customer experiences and helping to build robust relationships. We have strategic digital tie-ups to empower our frontline teams with detailed local insights and structured catchment texture. Available at individual business centre level, the insights allow the teams to focus on the requirements of the catchment, develop localised strategies, allocate resources and provide customers with a personalised experience and relevant solutions. The Bank continues to strengthen the organisational structure with ‘State Business Heads’ to capture the 360° opportunity in these geographies and ‘City Business Heads’ covering the full spectrum of the ecosystem in cities with large concentrated market opportunities. Credit Business Centres (CBC) continue to be placed closer to important markets to facilitate faster processing and delivery. The combination of micromarket insights and digitisation continues to drive growth and efficiency, enabling us to serve more customers effectively. As of March 31, 2024, ICICI Bank’s network comprised 6,523 business centres. Understanding Market Leveraging High Potential Segments & Ecosystems Grow Risk-Calibrated Profitability Aligning Business Centres Planning Business Centre Expansion in High Activity Pockets Execution Annual Report 2023-24 | 17 Integrated Report Statutory Reports Financial Statements OUR BUSINESS STRATEGY c. Focus on Ecosystems In line with the objective of creating customer-oriented ecosystems, the Bank has developed sector-specific solutions. These solutions focus on understanding industry and sector nuances and addressing specific requirements, which help to support businesses at every step of their journey. It provides comprehensive digital solutions for cash management, cross-border/domestic trade and supply chain finance as well as for their employees. These solutions cater to broking, custodian services, real estate, education, FMCG, healthcare, hospitality, NBFC, pharmaceutical and retail sectors among others. The Bank is focussing on enhancing the cross-border trade ecosystem through various initiatives. It leverages the power of digitisation to enable decongestion and simplification of customer journeys. The Bank captures the end-to-end customer transaction lifecycle and through AI-driven trade rules, provides cross- selling opportunities at different stages of trade transaction within the Bank and across. The entire proposition is powered by technology solutions built on strong infrastructure and in a secure environment. These solutions consist of services such as Instant Export Packing Credit (InstaEPC), trade accounts (Exchange Earners’ Foreign Currency Account and One Globe Trade Account), paperless export & import solutions i.e. e-Docs, i-Docs and e-Softex, foreign exchange solutions, digital letter of credit facility, electronic bill of lading (e-BL) and Trade Online i-BOE. The Bank has broadened its digital payment solutions to capture opportunities presented by the fast-growing merchant ecosystem, thereby facilitating seamless transactions across various payment platforms. Strategic partnerships with leading payment partners have further expanded the Bank's merchants’ market reach. Additionally, the focus is on enabling the merchants with relevant payment solutions fostering their digital transformation. As of March 31, 2024, the Bank had 13 exclusive business centres for ecosystem banking across Mumbai, National Capital Region (NCR) and Kolkata. These ecosystem business centres are full-service centres that house multi-functional teams with expertise required to meet the needs of corporate customers and bringing the entire bouquet of services of the Bank to these corporates and their ecosystems. Approach to Ecosystem Enhance Ecosystem Opportunities Multiple Large Ecosystems Identify all Opportunities Across the Value Chain Taking Entire Bank to the Customer Leverage Interlinkages and Focus on Execution 3600 Solutions Covering all Stakeholders • Corporate • NRI • Merchant • Student • GCC • Healthcare • E-Commerce • Cross-Border Trade • Capital Market • PE/VC • MNC • Start-ups ₹ ₹ 18 | Annual Report 2023-24 d. Collaborations and Partnerships Collaborating within and outside the organisation and building partnerships across the value chain is a key focus area. Partnerships with technology companies and platforms with large customer bases and operational excellence offer unique opportunities for growth and enhancing service delivery and customer experience in a safe banking environment. The Bank has key partnerships with Amazon, MakeMyTrip and Emirates to offer co-branded credit cards. Amazon Pay credit cards continued to see healthy traction with over four million credit cards issued till March 31, 2024. The Bank aims to provide 360° solutions to the new-to-bank customers that have been acquired through Amazon Pay credit cards. The growth in credit card transactions was driven by higher activation rate through digital onboarding of customers, acquiring progressive profile customers and automated and effective portfolio management. The Bank has not only pioneered the usage of FASTag for payments at various national and state highways, toll plazas but also expanded use cases to parking payments at airports, ports, malls, temples, hospitals, hill stations, forest and border check posts across the country. The Bank continues to grow in value of UPI acquiring transactions by growing faster than the ecosystem. Over the recent years, we have witnessed the emergence of a vibrant startup ecosystem that leverages technology to simplify payment processes and lending, among other financial services. ICICI Bank is committed to harnessing these emerging technologies to add value in four key areas: generating new revenue streams, enhancing cost efficiency within existing systems and processes, managing our risk portfolio more effectively, and elevating the overall customer experience. In order to achieve these goals, the Bank is actively building a comprehensive ecosystem through strategic partnerships with startups. The Bank focusses on innovation anchored partnerships in the early/growth stage startup ecosystem that align with the Bank’s digital roadmap and possesses the potential to address developments in the financial services space effectively. As a part of this process, we also make equity investments in select startups. To foster these relationships, we initiate a comprehensive engagement plan, ensuring that the ideas, products, and services offered by these startups align with the Bank’s core values, identify measurable goals and set timelines. The key to successful and timely engagement lies in fostering internal connections that amplify synergy. Partnerships with start-ups help enable quicker adoption of new-age technologies at scale such as Artificial Intelligence and Machine Learning, blockchain, computer vision, cloud computing and more. Our collaborations with startups span various business verticals and domains, encompassing retail banking, Non-resident Indian (NRI) banking, corporate banking, treasury solutions, customer service, internal risk management and compliance/legal management. In this context, the Bank has adopted a technology-based approach that enables it to respond to the changing dynamics in an agile and responsive manner. OUR BUSINESS STRATEGY • The value of credit card transactions in fiscal 2024 was 1.3 times the value in fiscal 2023. • A leader in FASTag with a market share of about 28% in fiscal 2024. Annual Report 2023-24 | 19 Integrated Report Statutory Reports Financial Statements OUR BUSINESS STRATEGY II. APPROACH TO DIGITAL, TECHNOLOGY AND PROCESSES a. Digital Platforms and Solutions iMobile Pay FXOnline iLens Trade Emerge API Banking InstaEPC OneSCF (Supply Chain) InstaBIZ Customised Solutions • The volume of UPI person-to-merchant (P2M) transactions increased by 34.4% year-on-year in fiscal 2024 and the value of these transactions was 1.76 times the value in fiscal 2023. • The Bank’s market share in value of UPI P2M transactions is about 19.3% in fiscal 2024. ICICI Bank's digital transformation journey involves integrating digital technologies and platforms to enhance customer experience. Providing a diverse range of services like mobile banking, internet banking, UPI payments, and digital wallets, the strategy emphasises accessibility and security for all users. This inclusive approach underscores the Bank's dedication to offering convenient and secure banking solutions for everyone utilising the Bank’s platforms. The open architecture platforms have enabled the Bank to extend banking services to non-ICICI Bank account holders. Digital channels continue to account for over 90% of financial and non-financial transactions. iMobile Pay: One App Strategy ICICI Bank’s iMobile Pay app strategy focusses on delivering a seamless, secure, and personalised banking experience. The app prioritises accessibility with a user- friendly interface for easy navigation and access to a wide range of banking services including account management, fund transfers, bill payments, and investments. The app also embraces innovation by integrating emerging technologies like AI-powered chatbots for customer support and biometric authentication for login. The coverage of iMobile Pay app has expanded to standalone loan customers, credit card customers and non-ICICI Bank account holders. Video KYC continues to empower retail customers to complete ‘Know Your Customer’ (KYC) process through video interaction within a few minutes. Video KYC is live for 22 products, and is also available for re-KYC. Security is paramount and it is ensured through advanced encryption, multi-factor authentication and other enhanced security measures such as limit on number of payee addition, customised transaction limits for internet banking and additional factor of grid card authentication. The Bank has also implemented an Enterprise Fraud Risk Management (EFRM) solution, a real-time transaction monitoring system which identifies transactions anomalies based on customer behaviour patterns and variety of data attributes. For the transactions qualifying the risk rule condition, an alert is generated which either 20 | Annual Report 2023-24 iMobile Pay Payments Spends Safety Feature Savings Borrow OUR BUSINESS STRATEGY declines the transaction or challenges customers with step up authentication or customer is called for transaction confirmation through interactive voice response call. The iMobile Pay app’s addition of ‘My Investment Portfolio’ features a dedicated section offering ICICI Bank customers a unified view of their investments. Furthermore, the introduction of iFinance (powered by account aggregator) presents a comprehensive solution, accessible to all users across the Bank’s digital platforms, enabling a consolidated view of all bank Travel, Shopping and Offers Scan to Pay, Pay to Contact Bill Payment and Recharge IMPS/NEFT/ Quick Transfers Instant Loans, Cards, PayLater, PayLater EMI Deposits 1 Till March 31, 2024 2 Live in Q1 fiscal 2025 11 mn+ Activations from Non-ICICI Bank account holders1 accounts. The addition of UPI for NRIs and smart scan capabilities simplifies transactions, complemented by its extensive range of 400+ services, with the unique voice search that makes navigation across these services quick and convenient. This holistic approach redefines digital banking standards, fostering deeper user engagement and loyalty. These advancements reflect ICICI Bank’s commitment to ensuring a seamless and convenient personalised banking experience for its customers that evolves with growing needs in the digital era. SmartLock2 Personal Finance Management Investment Annual Report 2023-24 | 21 Integrated Report Statutory Reports Financial Statements iLens iLens - ICICI Bank’s Lending Solution, is an integrated loan processing platform for retail loans. It is an industry-first end-to-end digital lending platform covering the entire loan life cycle, starting from onboarding to disbursement with the objective of providing superior transaction experience and enhanced operational efficiency. It is a future-ready solution which harnesses digital collaborations with the fintech ecosystem. It is cloud native, device responsive and has micro services enabled open architecture which not only allows flexibility to integrate with multiple internal and external systems through APIs, but also facilitates faster time to market and adaptability. In addition to mortgage which was introduced in fiscal 2023, product enhancements to iLens platform were made during fiscal 2024 to include personal loan and education loan. This is expected to further enable the Bank to provide enhanced customer experience and increase its ability to capture the entire Customer 360° ecosystem in a simplified, frictionless and digital manner, thereby creating value for the customers and the Bank. iLens acts as a common interface across all users required in a retail loan journey. It has an inbuilt customer interface ‘TrackMyLoan’ through which the customers can track real-time status of their loan application, submit documents, respond to queries and access various communications and documents like sanction letter and fees acknowledgement. It offers a wide range of digital solutions like instant approval for products to existing as well as new-to-bank customers, digital disbursements (e-sign and e-stamp) and digital KYC verifications. Besides catering to digital loan applications, it also caters to ‘phygital’ and physical loan applications. It is enabled with an in-house robust rule engine facilitating efficient decisioning and standard implementation of various policy, process and regulatory norms. OUR BUSINESS STRATEGY iLens - Digital Platform for Retail Lending Products One System for all Stakeholders One System for all Workflows One System for all Products Onboarding Verification Decisioning Disbursal • Paperless Login, Instant Sanction and Digital Disbursement • Digital Collaborations from Fintech Ecosystem • Robust Risk Management Framework • Real-Time Status Tracking Mortgage Personal Loan Education Loan 22 | Annual Report 2023-24 InstaBIZ: Business Banking App InstaBIZ: All-in-One App for Business Banking InstaBIZ is a one-stop solution for all banking needs of business banking customers. Our ‘All-in-One Business Banking’ app provides all services to help the customers with their daily business needs. Customers can apply for loans, avail instant overdraft, open a current account, manage export-import transactions, get merchant banking solutions, make instant bill and tax payments, and do a lot more with the business banking app on the go. The Bank strives towards continuous improvement by actively seeking and incorporating customer feedback into developing new & enhanced features to provide better customer experience through simplified journeys and intuitive UI/UX. Digital Platforms and Solutions for Corporate Customers ICICI Bank’s digital offerings for large corporates and their ecosystems include digital platforms for domestic and international trade, and industry-specific solutions across the value chain. The Bank has created several industry-specific STACKs, which provide bespoke and purpose-based digital solutions to corporate clients and their ecosystems. The four main pillars of ICICI STACK for corporates include digital banking solutions for companies; digital banking services for channel partners, dealers and vendors; digital banking services for employees; and curated services for senior client personnel. The Bank is investing in areas that are critical for delivering enhanced customer experiences, boosting productivity, improving operational efficiency and creating simplified customer journeys. The Bank commenced its journey to digitise the end-to-end Bank Guarantee (BG) issuance process across all touchpoints, from receiving a request to processing and delivery, providing an uninterrupted digital experience to the customers. Trade Online, the flagship platform for trade transactions, provides a digital channel to place BG requests online. The Bank has enhanced its BG offering by introducing Smart BG Assist, a first-of-its-kind solution, that makes the BG text creation process seamless by OUR BUSINESS STRATEGY All Services at One Place iFinance CIBIL Report FXOnline Annual Report 2023-24 | 23 Integrated Report Statutory Reports Financial Statements empowering the customers with a Do-it-yourself (DIY) experience, providing real-time feedback. Smart BG Assist is enabled across channels and business centres. The Bank has enabled digital execution of BGs using e-stamping and e-signing solutions, through empanelled agencies, that make BGs paperless and help in their digital transmission. The Bank also provides a digital repository of BGs for the beneficiaries on Trade Online which helps them in managing their incoming BGs. The entire process is crafted in a manner that provides operational efficiency to all the stakeholders. Supply chain financing is an increased requirement from corporate clients for bringing in efficiency and scale within their supply chain ecosystem. The Bank’s wide range of supply chain and structured trade products offer a one-stop solution to corporate clients and their supply chain partners, helping in optimising their working capital financing needs and thereby increasing efficiencies in their ecosystem. These supply chain solutions are offered digitally through various secured platforms namely OneSCF, Financial Supply Chain Management (FSCM), CorpConnect and DigitalLite, wherein corporates can seamlessly manage their supply chain requirements of payments, collections, data reconciliation and customised dashboards in a paperless environment. Digital Solutions for Non-Resident Indians Non-Resident Indians (NRI) banking continues to be a key growth driver for the Bank’s international banking business. The focus continues to be on improving customer experience through enhanced service architecture, value propositions and seamless processes, with the objective of capturing Customer 360° and market share. The Bank was amongst the first few to launch UPI facility for NRI customers. Currently this facility is available in ten countries – Australia, Canada, Hong Kong, Oman, Qatar, Saudi Arabia, Singapore, UAE, UK and USA. In addition, the welcome kit to on-board new customers on product and service offerings is now digital to add to the green initiatives. Simplified servicing at contact centres through voice biometrics eliminates the need for subsequent authentication. Facilitating frictionless cross-border remittance solutions has been the core strategy in re-designing the Bank’s solutions for both inward and outward remittance needs of NRIs and resident Indians. On Money2India-US, the remittances platform has been upgraded and integrated for increasing the instant account verification of remitters. For inward remittances, the Bank continues to focus on partnerships with other banks and exchange houses as well as, synergies with the channel teams to enhance offline remittance flows and service. On retail outward remittances, focus continues on leveraging iMobile Pay channel for existing and new customers. As an industry-first initiative, full value transfers (Guaranteed Delivery Product) have been enabled for all retail outward remittances in USD and GBP currencies facilitating the beneficiaries to get full value for their underlying remittance transaction. Automation of final credit confirmation to remitters through an SMS based on the SWIFT Global Payments Innovation (SWIFT GPI) integration has also been implemented. b. Transforming into BankTech In fiscal 2024, the Bank to BankTech journey has progressed with increased focus on technology platforms, embedded banking, cloud adoption, data platform and analytics. The Bank’s efforts continue to be guided by the three pillars of scalability, resilience and security across technology solutions. As a part of the Bank’s technology strategy, the Bank has created an enterprise architecture framework across digital platforms, data and analytics, micro services-based architecture, cloud computing, cognitive intelligence and other emerging technologies. Each facet of the architecture considers basic foundational elements of scalability, modularity, agility, availability and resilience besides being cloud native and digitally native. The Bank has also been reviewing the Generative AI framework and solutions for possible integration with applications currently used. The Bank has done an assessment of the opportunities and risks arising out of the Generative AI tools and models with initial focus towards creating internal tools to assist employees to serve customers better. OUR BUSINESS STRATEGY 24 | Annual Report 2023-24 The Bank has more than 4,600 APIs, of which close to 1,800 APIs are consumed internally for communication across applications. The Bank has about 2,600 APIs for Retail banking and about 200 APIs for Corporate banking. The Bank has been managing more than 160 million financial and non-financial transactions per day. The Bank has expanded its data centres across regions and is moving towards enabling Availability Zones across application clusters. The Bank has been investing in observability platforms which are critical towards ensuring preventive and proactive responses across application and infrastructure landscape. OUR BUSINESS STRATEGY 2,600 APIs for Retail Banking Over 200 APIs for Corporate Banking Over 160 million Financial and Non-Financial Transactions Per Day Over • Enterprise Data Platform • Data & Conversational Intelligence • Gen Al for Banking Use Cases • Robotic Process Automation • API, Embedded Banking • Digital Engagement Hub • Business Rule Engines, Workflows • Unified Customer Experience including Onboarding Journeys Across Self-Service and Assisted Flows • Enterprise Payments Hub • Trade Platform, Remittances • UPI on Cloud • iMobile, InstaBIZ • Internet Banking • CRM • Platform Revamp • Hollowing the Core • Containerised Deployment Data & Intelligence Federation Onboarding & Servicing Trade & Payment Engagement Core Platforms Servicing Onboarding Transaction Sales Scalable Resilient Secure ₹ Approach to Technology Annual Report 2023-24 | 25 Integrated Report Statutory Reports Financial Statements OUR BUSINESS STRATEGY The fast-moving technology landscape along with various channels of interaction also means increased focus on information security across various aspects of technology beginning from data centre to the cloud to the entire technology supply chain. The Bank has adopted an integrated security architecture based on zero trust principles across data centre and cloud implementations. c. Building Efficiencies and Flexibility The Bank leverages technology to automate and redesign processes, building end-to-end digital journeys, removing redundancies and using public digital infrastructure (PDI) to strengthen operational resilience and deliver seamless customer service. In the fiscal year 2024, the Bank focussed on better customer engagement and relationship building at business centres by consolidating their operational activities and releasing their capacity through OpsServe initiative. The Bank has also initiated programs like UDAAN for NRI, senior citizen campaign for reaching out to customers proactively for timely servicing. The Bank is leveraging the changing technological landscape and the power of subtraction to give a Customer 360º product onboarding experience to customers with initiatives such as One KYC, savings account with home loan, co-branded cards with minimum data and documentation. The Bank has also focussed on rationalising variants and removing complexity for its Business Banking Customers through end-to-end unified and automated disbursement journeys which has resulted in leaner processes and reduced turnaround time. The Bank focusses on simplification of processes and building digital journeys to create faster and seamless delivery of services to its customers. The Bank has upgraded to a single enterprise-level Customer Relationship Management (CRM) platform with enhanced capabilities for all servicing needs of the customers. III. APPROACH TO CULTURE a. One Bank, One Team The core principle of 'One Bank, One Team' underscores the Bank's endeavour to harness business opportunities across ecosystems and micromarkets. Employees are equipped with requisite knowledge and skills to serve customers in line with ‘One Bank, One Team’. Emphasising teamwork and collaboration to provide comprehensive financial solutions to customers, is reflected in the compensation to employees with performance bonuses tied to the overall Bank’s performance. Further, the Bank has restructured teams internally to better support its Customer 360° strategy by deepening leadership presence in key markets. Through job rotation, employees gain broader exposure to banking products and are encouraged to identify opportunities for Customer 360º within the guardrails of risks and compliance. For more details kindly refer page 52 b. Fair to Customer, Fair to Bank The principle of ‘Fair to Customer, Fair to Bank’ emphasises the need to deliver fair value to customers while creating value for shareholders, which would guide the Bank’s operations. The Bank seeks to sell products and offer services which meet societal needs and are in the interest of our customers. The Bank also strives to enable its employees to keep delivering a seamless customer experience. For more details kindly refer page 32 c. Risk and Compliance Culture ICICI Bank recognises the importance of establishing an effective framework and supporting processes so that all employees seek to exhibit values aligned to the risk and compliance culture policy. The aim is to uphold a strong risk and compliance culture throughout the Bank. The Risk and Compliance Culture Policy establishes the guiding principles and the framework for implementation of the same. The effective implementation of the policy includes a governance framework with roles and responsibilities of the Board, MD & CEO and Executive Directors and the Risk and Compliance Culture Council. The Council undertakes the periodic review on status of implementation of the policy and updates are provided to the Board on an annual basis. For more details kindly refer page 30 26 | Annual Report 2023-24 OUR BUSINESS STRATEGY The Bank offers financial solutions to micro-finance institutions, Self-Help Groups (SHGs), co-operatives constituted by farmers and corporations and Small and Medium Enterprises (SMEs) engaged in agriculture-linked businesses. KEY AREAS OF BUSINESS Retail and Rural Banking The retail business continued to be a key driver of growth in fiscal 2024, as we pursued a strategy of building a diversified and granular loan portfolio. The Bank’s retail portfolio grew by 19.4% year-on-year to `6,662.61 billion at March 31, 2024. Retail loans accounted for 54.9% of total loans, and including non-fund based outstanding, the share was 46.8% in the total portfolio. The Bank has undertaken several initiatives to offer a convenient and frictionless experience to customers by digitising the entire underwriting process, with instant loan approvals. In order to capture the growing opportunities in rural market, the Bank has merged retail and rural business groups within one structure which reflects the Bank’s increasing focus towards rural India. The Bank’s rural portfolio grew by 17.2% year-on-year to `1,024.46 billion at March 31, 2024, accounting to 8.4% of the total portfolio. The Bank offers a diverse set of products catering to end- to-end needs in the value chain. The Bank also provides consumption loans for low-income customers. Financial solutions are offered to micro-finance institutions, Self- Help Groups (SHGs), co-operatives constituted by farmers and corporations and Small and Medium Enterprises (SMEs) engaged in agriculture-linked businesses. The Bank’s strategy to serve the rural segment of the economy is based on the integrated nature of the rural ecosystem. The Bank has identified four main ecosystems in the rural market to enrich the banking experience for its habitants. These ecosystems include farmers, dealers, self-employed, and micro-entrepreneurs. The farmer ecosystem includes participants like agriculturists, seed producers, agri-input dealers, warehouses, agri-equipment dealers, commodity traders and agri processors. Products offered include working capital loans through the Kisan Credit Card (KCC) and gold loans and term loans for farm equipment, and farm development. The dealer ecosystem comprises dealers/ distributors of farm equipment, and various inputs and ancillary suppliers related to rural economy. The self- employed ecosystem comprises rural entrepreneurs who are engaged in trading and manufacturing activities based out of commercial and industrial areas in the rural market dealing with both agri & non-agri related products. The micro-entrepreneurs lending space includes women from the lower-income strata of the population, non-government organisations and other institutions working at the grassroots level in the rural economy. The operational structure and offerings put the Bank in a unique position to leverage opportunities in different ecosystems within the rural markets. The Bank’s reach in rural areas comprises a network of branches, ATMs, field staff and business correspondents providing last-mile access in remote areas. Of the Bank’s network of 6,523 business centres, 50.7% are in rural and semi-urban areas. Including the Business Correspondent Agent network, the Bank covers over 9,940 rural locations. There were over 4,600 ATMs at semi-urban and rural centres at March 31, 2024 having a proportion of 27% out of the total number of ATMs pan India. Small and Medium Enterprises and Business Banking The Small and Medium Enterprises (SME) and Business Banking portfolio comprises exposures to companies with a turnover of up to `2.50 billion. The SME and Business Banking portfolio grew by 27.4% to `1,533.23 billion at March 31, 2024, accounting for 12.7% of the overall portfolio. Annual Report 2023-24 | 27 Integrated Report Statutory Reports Financial Statements OUR BUSINESS STRATEGY The growth in the portfolio was driven by the Bank’s approach of catering to 360° needs of customers across business life cycle ranging from onboarding, payment & collection, cross-borders, account reconciliation besides working capital requirements. Envisaging these customer requirements, the Bank devised comprehensive digital solutions & platforms which are also fulfilled through Do-it-Yourself (DIY) and Do-It-for-Me (DIFM) through our business centres, InstaBIZ mobile apps and the Bank’s website and partner websites. In addition, a dedicated Relationship Manager completes the Bank’s approach to providing full 360° solutions to its customers. The Bank’s focus in these businesses continues to be on parameterised and programme-based lending, which is granular and well-collateralised. The Bank has devised an integrated underwriting approach which is scorecard driven. Leveraging digital tools and data analytics, the Bank has built a couple of scorecards namely Unicore and Infinity, which cater across customers, turnover ranges and loan ticket size. A combination of qualitative and quantitative assessment tools is utilised to arrive at the final credit decision. Additionally, to cater specifically to the micro segment, the Bank has put in place a surrogate programme-based underwriting process on documents such as bank statement and Goods and Services Tax (GST) returns for credit assessment. The Bank maintains a robust risk management framework to manage the SME and business banking portfolio. The Bank constantly monitors and analyses the portfolio to detect stress, thus enabling the Bank to take early action and ensuring healthy portfolio quality. The Bank has further strengthened its underwriting process by integrating various digital tools like bank statement analyser, automatic fetching of bureau reports and enhanced business rule engine to generate probability of default scores for score-based analysis. Wholesale Banking The Bank’s wholesale banking customers include large private sector business houses and companies, banks and financial institutions, public sector undertakings and central and state government entities. The Bank’s wholesale banking portfolio grew by 10.0% year-on-year to `2,582.79 billion at March 31, 2024, accounting for 21.3% of the total portfolio. The Bank also has a strong The Bank devised comprehensive digital solutions & platforms which are also fulfilled through Do-it-Yourself (DIY) and Do-It-for-Me (DIFM) through our business centres, InstaBIZ mobile apps and the Bank’s website and partner websites. 28 | Annual Report 2023-24 OUR BUSINESS STRATEGY franchise among Multi-National Corporations (MNCs), real estate companies, IT & ITeS and new-age services companies, along with the financial sponsors space with special focus on private equity funds and their investee companies. Additionally, the Bank also caters to the requirements of the capital market participants and custody service providers through digital solutions improving their operational efficiency. The Bank’s approach has been to deepen partnership with its clients and provide support to clients through their entire life cycle. The Bank caters to various needs of the clients across trade, treasury, bonds and commercial papers through its comprehensive and technologically advanced delivery platforms while also catering to the needs of their supply chain network. The Bank aims to become a business partner to its clients instead of merely being a capital provider. With the client at the centre, all teams across the Bank are well-aligned to offer the entire Bank’s offerings to wholesale clients and their ecosystems. This has not only made client servicing more effective, but also helped in deepening the Bank’s relations in high-value retail accounts of senior client personnel and employees through a suite of retail products like salary, private and wealth banking, home loans, personal loans and vehicle loans. Supply chain financing is an integral part of the corporate ecosystem and solutions like CorpConnect and DigitalLite enable corporates to seamlessly manage supply chain financing, payments, collection and reconciliation requirements of their dealers and vendors in a convenient and paperless process. These solutions also automatically assess the eligibility of the client’s dealers and vendors for credit through a business rule engine, GST returns, intelligent algorithm with automated bureau checks and dedupe checks. The Bank has extensively leveraged analytics to monitor transactions and the portfolio quality. While new credit is extended in a granular manner to well- established and well-rated business groups, data analytics is used for portfolio monitoring and identification of early warning signals in the existing portfolio. This has led to enhancement of the overall quality of the corporate portfolio. Our solutions like CorpConnect and DigitalLite enable corporates to seamlessly manage supply chain financing, payments, collection and reconciliation requirements in a convenient and paperless manner. Annual Report 2023-24 | 29 Integrated Report Statutory Reports Financial Statements International Business ICICI Bank’s international presence consists of business centres in six overseas locations and representative offices in ten locations outside India. The Bank’s overseas book was `334.51 billion at March 31, 2024, accounting for 2.8% of the total portfolio. The Bank has an IFSC Banking Unit (IBU) in GIFT City Gujarat, an Offshore Banking Unit (OBU) in Mumbai, and wholly-owned subsidiaries in the United Kingdom (UK) and Canada. The Bank’s international franchise focusses on four strategic pillars, namely the NRI ecosystem comprising deposits, remittances, investments and loan products; the MNC ecosystem comprising both foreign MNCs investing in India and Indian MNCs for their foreign currency and other requirements outside India, as well as Global Capability Centres (GCC), which are back-offices of MNCs created to serve the world; trade ecosystem, comprising primarily India-linked trade transactions which are self-liquidating in nature; and funds ecosystem, to capture fund flows into India through the Foreign Portfolio Investment (FPI) and Foreign Direct Investment (FDI) route. The IBU in GIFT City endeavours to capture global banking requirements of the Bank’s client base in India to enhance the Customer 360° banking experience. IBU business centre complements the Bank's domestic business by providing foreign currency banking solutions OUR BUSINESS STRATEGY The Bank’s international franchise focusses on four strategic pillars, namely the NRI ecosystem comprising deposits, remittances, investments and loan products. across corporate banking, funds, wealth management and global markets business. ICICI Bank is a settlement banker to all three exchanges in GIFT City – NSE IFSC, India International Exchange (INX) and The India International Bullion Exchange (IIBX). The Bank has also obtained clearing, custody and depository participant licence. The Bank has cleared the maiden transaction in bullion (gold & silver) on IIBX platform. We have expanded the retail offerings by introducing four new currencies for opening savings accounts and term deposits, bringing the total to eight currencies: USD, GBP, EURO, CAD, SGD, AED, AUD, and JPY. On the product front, there has been continuous development over the past year like initial launch of retail internet banking for GIFT City customers and simplification of account opening form. Government Banking Government is transitioning towards efficient financial management and transparency in transactions through digitisation and direct benefit transfer (DBT). ICICI Bank has been providing a range of banking services to government departments and their ecosystem through a network of physical and digital channels. The Bank offers its government customers integrated and plug-n-play digital solutions, to assist them in effective delivery of services to stakeholders including citizens. The Bank is assisting state-level agencies and last-mile implementing agencies for adoption of Single Nodal Agency (SNA) payment model and DBT payments for management of Government of India scheme funds. ICICI Bank’s digital platforms provide simple online tax payment options to customers. The Bank is assisting the government for collection of central taxes, state taxes, customs duty, GST payments through authorised business centres and digital platforms. The Bank has also integrated its payment services with the e-governance initiative of government like Government e-Marketplace (GeM), e-tendering and e-treasury. Online Overseas Money Transfer Simple | Secure | Quick 30 | Annual Report 2023-24 OUR VALUES The Bank lays strong emphasis on risk and compliance and creating awareness among employees on the core values and desired behaviour. Employees are expected to act in accordance with the highest professional and ethical standards. ICICI Bank continuously endeavours to strengthen its culture and encourage adoption of values and code of conduct amongst employees and doing business in a fair and transparent manner. Every action is aimed at benefiting the customer and the Bank. The Bank continuously strives to embed relevant principles and communicate the organisation’s culture on an ongoing basis. In fiscal 2022, the Bank introduced the Risk and Compliance Culture Policy, enumerating the guiding principles for strengthening the risk and compliance culture, recognising the importance of establishing effective frameworks and supporting processes that encourage employees to exhibit the desired ethos of the Bank. The Risk and Compliance Culture Policy outlines the guiding principles and key aspects for their effective implementation of these principles. The effective implementation of the policy includes a governance framework that defines the roles and responsibilities of the Board, MD & CEO, Executive Directors, and the Risk and Compliance Culture Council. Consistent and continuous communication of these principles during employee interactions is an effective mechanism for embedding these core values. All employees are encouraged to align with these guiding principles in their activities. Additionally, business compliance officers are appointed within functional teams to strengthen compliance practices. The Bank is committed to acting professionally and fairly in all its dealings. The ICICI Group Code of Business Conduct and Ethics provides the values, principles and standards that should guide the decisions and actions of the Bank employees. This Code is also the Bank’s commitment to its stakeholders for adhering to the highest ethical standards and dealing with integrity. Return of Capital is Paramount The Guiding Principles One Bank, One Team Fair to Customer, Fair to Bank Compliance with Conscience Agile Risk Management Annual Report 2023-24 | 31 Integrated Report Statutory Reports Financial Statements The Bank has a zero tolerance approach to bribery and corruption. The Bank has a well-defined Anti-Bribery and Anti-Corruption policy articulating the obligations of employees in these matters. The Bank has a Board-approved Group Know Your Customer (KYC), Anti-Money Laundering (AML) and Combating Financing of Terrorism (CFT) Policy. The policy lays down a risk-based approach in implementing the AML framework. AML standards of the Bank are mainly based on two pillars, namely, Know-Your- Customer (KYC) and monitoring/reporting of suspicious transactions (MSTR). The policy also requires monitoring of transactions on pre-defined rules as per the regulatory guidelines and any suspicious transactions found are required to be reported to the concerned authorities. The Bank through name screening procedure ensures that the identity of the customer does not match with any person with known criminal background or with sanction/banned entities. For the purpose of avoiding proliferation financing/terrorism financing, the Bank maintains lists of individuals or entities issued by Reserve Bank of India, United Nations Security Council, other regulatory and enforcement agencies, legislation and internal lists as the Bank may decide from time to time. Further, while handling cross-border transactions, the Bank carries out screening of names/parties involved in a transaction against sanctions lists as mentioned above and other negative lists, as applicable at that point of time. The Bank continuously focusses on effectiveness of financial controls and assesses compliance with all relevant regulatory requirements. Key policies of the Bank are reviewed and enhanced to ensure relevance, adherence to regulations and adoption of best practices on an ongoing basis. The Board-approved Group Compliance Policy lays down the compliance framework with emphasis on ensuring that products, customer offerings and activities conform to rules and regulations and adheres to the Bank’s ethos of ‘Fair to Customer, Fair to Bank’. The Bank undertakes periodic training sessions and sends information e-mailers, as part of knowledge- enhancement and awareness, to employees. The frequency of messages is high for areas like fraud risk management, data privacy, cybersecurity, compliance policies, conflict of interest, sexual harassment, etc. The Bank is committed to constantly reviewing its governance practices and frameworks, with the objective of staying updated and responsive to the dynamic and evolving landscape and acting in the best interest of all stakeholders. OUR VALUES Standards of the Group Code of Business Conduct and Ethics • Conflict of Interest • Privacy/Confidentiality • Anti-Bribery and Anti-Corruption/Gifts and Entertainment • Personal Investment • Accuracy of Company Records and Reporting • Know-Your-Customer/Anti-Money Laundering and Combating Financing of Terrorism • Protecting ICICI Group’s Assets • Workplace Responsibilities and Social Media 32 | Annual Report 2023-24 FAIR TO CUSTOMER, FAIR TO BANK The Bank continues to deepen its engagement with customers and further simplify delivery processes and digital platforms, with a sharp focus on enhancing efficiency and resilience. In fiscal 2024, the Bank continued to lay emphasis on delivering customer delight, providing frictionless interactions, offering intuitive digital interfaces and enhancing customer advocacy by continuously decongesting processes, digitising and re-imagining customer journeys. We are harnessing new-age technologies and platforms to enable us to serve our customers with simplicity. The philosophy of ‘Fair to Customer, Fair to Bank’ and the culture to serve the end-to-end needs of customers continued to drive mutually beneficial customer relationships and build trust in our brand. Deepening our engagements with customers to understand their expectations and the insights gathered from proactive product and process walkthroughs, Net Promoter Score (NPS), Voice of Customer (VOCs), customer complaints and Root Cause Analysis (RCAs) helped in implementing various customer service initiatives. The philosophy of ‘Fair to Customer, Fair to Bank’ and the culture to serve the end-to-end needs of customers continued to drive mutually beneficial customer relationships and build trust in our brand. Annual Report 2023-24 | 33 Integrated Report Statutory Reports Financial Statements Some of the key initiatives which were implemented for enhancing service delivery and customer experience were: ENHANCING AND DECONGESTING THE CUSTOMER ONBOARDING EXPERIENCE The onboarding experience was further decongested by enhancing Customer 360°, to ensure that no additional KYC documents have to be submitted when an existing customer avails a new product from the Bank and the existing data and documents with the Bank are processed. Customer 360° was enhanced to cover loans (home loans, personal loan, auto loan), credit cards, standalone Fixed Deposits (FD) and NRI products. VOICE CHANNELS- ENHANCEMENTS IN SERVICE DELIVERY At the Bank’s Voice Channels that handle around five million engagements every month, the focus was on service improvement and seamlessly managing the increase in the customer base. To further enhance the service experience, various interventions were implemented including: Virtual Hold To enable a smooth customer experience of connecting to the Voice Relationship Manager (RM), a new feature Virtual Hold was introduced. Once a call is in queue and the expected wait time is longer than the defined threshold, a prompt is played on the IVR, where the customer has the option to receive a call back while retaining the sequence number in the queue. V-Serv Plus This is designed to manage customer queries that may require expert intervention and a Subject Matter Expert guides the RM and provides end–to-end resolution. Voice Biometric This enables a customer’s voice print to be enrolled for verification. Instead of entering authentication details, the customer’s voice is enrolled and utilised for authenticating future calls. Enhancing Digital Adoption For customers calling the Voice channel for availing a service, the Voice RM has an option to send a WhatsApp notification to the customer on a real-time basis. This helps customers to experience the digital journey and adopt the same for future service needs. NEW DIGITAL EXPERIENCES Our digital channels bring together innovation, security and resilience while delivering customer delight across journeys and we continually look to enhance our digital journeys. • Features on our digital channels were enhanced to enable UPI payments for NRI customers through iMobile Pay. • End-to-end digital issuance and set-up has been enabled for credit cards for both existing and new customers with the verification of identity, employment and income being done by leveraging Video KYC and account aggregator. • Various enhancements were introduced in the iMobile Pay journey for fixed deposits such as identifying senior citizens and displaying interest rates accordingly, instant FD creation in one click, multiple FD creation in the same session and FD for non-ICICI Bank customers. • Digital home loan application and disbursement has been enabled to offer rapid approval by leveraging an account aggregator and online rule engine for verification of identity, income and employment. Customers can also open a new disbursement request and track their home loan disbursement directly through iMobile Pay and retail internet banking under the loans section. SERVICE ENABLERS FOR EMPLOYEES To facilitate seamless servicing at the business centres, the Bank’s endeavour is to decongest and simplify processes and customer journeys to enable the frontline staff to deliver enhanced customer engagement. For this, various enablers were implemented at the business FAIR TO CUSTOMER, FAIR TO BANK 34 | Annual Report 2023-24 FAIR TO CUSTOMER, FAIR TO BANK centres, such as DigiServe, where operations staff is available on-site for processing transactions at high footfall business centres, enabling 100+ services in BOTM (Branch on the Move), simplification of key processes such as minor to major conversion and re-KYC and mobile number updation for NRI customers. Enablers were also introduced for better handling of issues that cause emotional anxiety for customers such as deceased claim. This includes a dedicated helpline, reference grid for identifying right documents to be communicated to the customer among others. Credit card services at business centres were enhanced, with 30+ credit card services being enabled, including change in address, limit enhancement, activation of auto debit, etc. Loan and demat servicing were also enhanced across business centres. During fiscal 2024, the Bank saw a sustained improvement in the Net Promoter Score (NPS), reflecting customer value creation and advocacy. CUSTOMER SERVICE AND GRIEVANCE REDRESSAL The Bank monitors key customer service metrics and complaints through a well-defined framework. The Customer Service Committee of the Board and the Standing Committee on customer service convene on a regular basis to deliberate on customer service and the initiatives undertaken by the Bank for enhancing the same. The Bank complies with the ‘Customer Rights Policy’ which enshrines the basic rights of customers. These rights include Right to Fair Treatment; Right to Transparency, Fair and Honest Dealing; Right to Suitability; Right to Privacy; Right to Grievance Redress and Compensation. These policies are available on the Bank’s website. The Bank aims to treat its customers fairly and provide transparency across its offerings. Continuous customer education efforts are made to enable customers to make informed choices regarding banking products and services. The Bank also seeks to ensure that the products offered are based on an assessment of the customer’s financial needs. The Bank has a well-defined and comprehensive grievance redressal mechanism, to provide resolution to customers with clear turnaround times. The Bank offers multiple channels to customers to register complaints including the business centres, voice and digital channels. All complaints received by the Bank are recorded in a Customer Relationship Management (CRM) system and tracked for end-to-end resolution. The Bank has an escalation matrix built in the CRM system to ensure that customer requirements are appropriately addressed within stipulated timelines. Detailed Root Cause Analysis (RCAs) of the issues highlighted in customer feedback, complaints, etc. are conducted. and insights from the same are implemented to improve the products and processes and enhance the services of the Bank. Further, as recommended by the Reserve Bank of India, the Bank has appointed senior retired bankers as Internal Ombudsmen of the Bank. The Customer Service Committee of the Board, the Standing Committee on Customer Service and the business centre level Customer Service Committees monitor customer service at different levels. CUSTOMER ENGAGEMENT BEYOND BANKING Recognising customers’ need to understand personal finance better, the Bank launched a unique digital initiative ‘The Orange Book’ in fiscal 2022. This is a monthly e-magazine that educates customers about ORANGE BOOK THE Leverage Your Financial Quotient APRIL 2024 | VOL. 35 Equinox: The importance of Balance ORANGE BOOK THE Leverage your FINANCIAL QUOTIENT MARCH 2024 | VOL.34 The Orange Book is a monthly e-magazine that educates customers about personal finance in a simple and easy-to- understand manner. Annual Report 2023-24 | 35 Integrated Report Statutory Reports Financial Statements personal finance in a simple, easy-to-understand manner using contextual examples, infographics and interactive games & puzzles, and helps them to take better financial decisions. The Orange Book has covered an array of financial topics from inception till date, including fundamentals like power of compounding and emergency fund to goal-based investing, tax saving and importance of nomination, will writing and succession planning. The Orange Book also continuously educates customers about how to protect themselves from emerging frauds. This initiative has been well-received by customers. DATA PROTECTION AND PRIVACY ICICI Bank is committed to protecting the privacy of individuals whose personal data it holds, and processing such personal data in a way that is consistent with applicable laws. It is important for employees and businesses to protect customer data and follow the applicable privacy laws in India and overseas locations to ensure safety and security of data. We believe that the data privacy framework should be aligned to the evolving regulatory changes and digital transformation. The Bank has a presence in several jurisdictions outside India including Hong Kong, Singapore, United States, United Kingdom, Canada, China, Dubai International Financial Centre and Bahrain. The Bank is committed to ensuring compliance with applicable laws across these jurisdictions. It has an integrated and centralised strategy for achieving data privacy compliance across all jurisdictions. A set of principles have been defined with respect to handling customer data. There is a mechanism in place, which is accessible to all employees in the Bank, for reporting any form of personal data incident. The Personal Data Incident Handling Forum (PDIHF) comprises the Data Protection Officer (DPO) and senior members from the Information Security Group, Operational Risk Management Group, Fraud Management Group, Human Resources Management Group, Compliance Group and Legal Group. Any kind of personal data related incidents reported through the service request undergoes detailed investigation and a report is presented to PDIHF at monthly intervals. As per the Personal Data Protection Standard of the Bank, it ensures that all personal data it processes is FAIR TO CUSTOMER, FAIR TO BANK kept secure using appropriate technical and organisational measures including necessary policies, processes and controls which includes physical access control, encryption, data protection impact assessment and providing training to the Bank’s employees. The Bank periodically updates the Personal Data Protection Standard to cover the personal data protection regulatory requirements as applicable to the Bank in India and its overseas offices to reflect the changes in data protection laws and regulations. Privacy regulations require the personal data of customers to be protected throughout the entire life cycle. Accordingly, the Bank has undertaken several comprehensive measures such as categorising all personal data and sensitive personal data as ‘Confidential Information’, keeping record of all its processing activities, entering into non-disclosure and confidentiality agreements with employees and third parties who are privy to personal data of the customers and providing customers the option to exercise various rights which they enjoy under applicable data protection regulations and incident handling procedures. There are e-learning modules specifically on the concept of personal data and its protection to build awareness among employees. Periodic trainings are provided and various data privacy awareness initiatives are taken up by the Data Privacy team for employees to help them get an overview of data privacy and its importance in day-to-day work. Periodic mailers are also sent to the employees to create awareness about data privacy. The Bank has established a strong governance framework for data privacy management. The Bank’s Data Protection Officer (DPO) oversees all privacy related developments for the Bank as a data processor for international banking business and as a data controller/data fiduciary for its banking activities in India. The Bank has designated data protection managers/ representatives from each business function and at each overseas location to ensure the proper implementation of the privacy standard. A Privacy Steering Committee, oversees various privacy related initiatives. Further, the Bank’s Code of Business Conduct and Ethics includes guidelines on customer privacy and confidentiality of data. 36 | Annual Report 2023-24 RISK GOVERNANCE FRAMEWORK The Bank is committed to achieve responsible and sustainable growth, underpinned by our core values of Return of Capital, Agile Risk Management and Compliance with Conscience. As a financial intermediary, the Bank is exposed to various risks, primarily credit risk, market risk, liquidity risk, operational risk, technology risk, cyber risk, compliance risk, legal risk and reputation risk. The Bank is committed to managing material risks and participating in opportunities as part of the strategic approach of risk-calibrated growth in profit before tax excluding treasury. The Board of Directors of the Bank has oversight of all risks in the Bank with specific Committees of the Board constituted to facilitate focussed oversight. Most Committees are chaired by Independent Directors and there is adequate representation of Independent Directors on each of these Committees. The Board has framed specific mandate for each of these Committees. The proceedings and the decision taken by these Committees are reported to the Board. The policies approved by the Board of Directors or Committees of the Board, from time to time constitute the governing framework within which business activities are undertaken. Several groups and sub-groups have been constituted to facilitate independent evaluation, monitoring and reporting of risks. These groups function independently of the business groups. The Risk Management Group is further organised into the Credit Risk Management Group, Market Risk Management Group, Operational Risk Management Group and Information Security Group. The Group is headed by the Chief Risk Officer who reports to the Risk Committee of the Board of Directors. The Bank also has a Financial Crime Prevention Group (FCPG) to oversee/handle fraud prevention, detection, investigation, monitoring, reporting and creating awareness about fraud risk management. The roles of specific committees of the Board constituted to facilitate focussed oversight of various risks are: • Credit Committee: Approval of credit proposals as per the authorisation approved by the Board and review of developments in key industrial sectors, non-performing loans, accounts under watch, incremental sanctions, non-fund based exposures, unsecured portfolio, capital market exposures, commercial real estate exposures, retail exposures etc. • Audit Committee: Provides direction to the audit function and monitors the quality of internal and statutory audit; responsibilities include examining the financial statements and auditors’ report and overseeing the financial reporting process to ensure fairness, sufficiency and credibility of financial statements. • Information Technology Strategy Committee: Approve strategy for IT and policy documents, ensure that the IT strategy is aligned with business strategy, review performance with reference to IT & IS Key Risk Indicators (KRIs) and conduct periodic review of KRIs to ensure coverage of IT & IS risks, ensure proper balance of IT investments for sustaining the Bank’s growth, oversee the aggregate funding of IT at Bank-level, ascertain if the management has resources to ensure the proper management of IT risks, review contribution of IT to business, oversee the activities of Digital Council, review technology from a future readiness perspective, overseeing key projects progress and critical IT systems performance including review of IT capacity requirements and adequacy and effectiveness of Business Continuity Management and Disaster Recovery, review of special IT initiatives, review cyber risk, consider the RBI Annual Report 2023-24 | 37 Integrated Report Statutory Reports Financial Statements inspection report/directives received from time to time by the Bank in the areas of information technology and cybersecurity and to review the compliance of various actionables arising out of such reports/directives as may be deemed necessary from time to time and review deployment of skilled resources within Technology and Information Security function so as to ensure effective and efficient deliveries. • Risk Committee: Review risk management policies pertaining to credit, market, liquidity, operational, outsourcing, reputation risks, business continuity plan and disaster recovery plan. The functions of the Committee also include setting limits for industry or country, review the Bank’s Enterprise Risk Management Framework, Risk Appetite Framework, Stress Testing Framework, Internal Capital Adequacy Assessment Process and Framework for Capital Allocation. In addition, the Risk Committee reviews the Basel Framework, risk dashboard covering various risks, outsourcing activities. The Committee also reviews the cybersecurity risk assessment. The Bank has put in place an Enterprise Risk Management (ERM) and Risk Appetite Framework (RAF) that articulates the risk appetite and drills the same down into a limit framework for various risk categories under which various business lines operate. In addition to the ERM and RAF, portfolio reviews are carried out and presented to the Credit and Risk Committees as per the approved calendar of reviews. As part of the reviews, the prevalent trends across various economic indicators and their impact on the Bank’s portfolio are presented to the Risk Committee. Industry analysis are also carried out and outcomes are presented to the Credit Committee for review and guidance. The Internal Capital Adequacy Assessment Process (ICAAP) encompasses capital planning for a four-year time horizon, assessment of material risks and the relationship between risk and capital. Stress testing, which is a key aspect of the ICAAP and the risk management framework, provides an insight on the impact of extreme but plausible scenarios on the Bank’s risk profile and capital position. The Reputation Management Forum, comprising Executive Directors and leadership members, oversees reputation risk assessment at the Bank. The Forum has adopted a framework for conducting periodic reviews and ensuring adequate processes and systems to identify, assess and mitigate reputation related risks. The risk and control assessment is presented to the Board Risk Committee on a quarterly basis. The Internal Audit Group, being the third line of defence, provides independent assurance that the aforesaid independent groups monitoring the risks in the Bank, are operating in line with policies, regulations and internal standards defined for management of the various risks in the Bank. The Compliance Group, headed by the Group Chief Compliance Officer, oversees regulatory compliance of the Bank, both at the policy and procedures level and at the level of implementation by the respective groups. The Group has unrestricted access to information within the Bank to assess compliance with the regulatory guidelines. The Compliance Group and the Internal Audit Group report to the Audit Committee of the Board of Directors. The Risk Management, Compliance and Internal Audit Groups have administrative reporting to the Executive Director responsible for Corporate Centre. With increasing digitisation, ensuring effective management and governance of data has become a critical business enabler. To further strengthen data quality, data standardisation and governance around data, a Chief Data Officer (CDO) was appointed in fiscal 2023. The role of the CDO includes creating the governance and processes around data generation and processing and compliance with regulations for customer data captured by the Bank. The CDO is also responsible for implementation of the Bank’s Data Governance Policy. Independent Groups for Monitoring Risks • Risk Management Group • Compliance Group • Internal Audit Group • Financial Crime Prevention and Reputation Risk Management Group RISK GOVERNANCE FRAMEWORK 38 | Annual Report 2023-24 CYBERSECURITY GOVERNANCE Cyber risk management forms an integral part of the Bank’s enterprise risk management framework. The Bank is committed and working towards aligning itself with the changing threat landscape and has a dedicated team for cyber/information risk management. Our cybersecurity governance encompasses management oversight at various levels with the ultimate responsibility assumed by the Board of Directors. Regular updates are provided by the Information Security Group (ISG) of the Bank. The Executive Committees have diverse cross- functional members and well-defined terms of reference. Proceedings of these Committees are reported to the IT Strategy Committee. Additionally, the Bank has multiple Key Risk Indicators (KRIs) /dashboard to review system stability, continuity and availability and network uptime. The Bank also has a well-defined Information Security Policy, Cyber Security Policy and Information Security Standards and Procedures. These policies have been designed by drawing from several standards and regulations including the RBI Cyber Security Framework, National Critical Information Infrastructure Protection Centre (NCIIPC) Guidelines for Protection, Federal Financial Institutions Examination Council (FFIEC) Cybersecurity Assessment Tool, the SEBI Cyber Security and Resilience Framework for Stock Brokers/Depository participants, IRDA Guidelines on Information and Cyber Security for insurers, Unusual Cyber Security Incidents framework. The Bank has also incorporated industry best practices such as the National Institute of Standards and Technology (NIST) and the regulatory requirements of some other jurisdictions in which the Bank operates. Further, periodic internal and external audits are undertaken and inputs from these assessments are incorporated. The Bank has a 24x7 Security Operation Centre for monitoring and surveillance of information technology systems. Considering the criticality and vitality of data protection, we have deployed a Data Leakage/ Loss Prevention system with data protection rules for sensitive data exposure from the Bank’s endpoints, emails, and web gateways. The Bank’s Data Centre and Security Operations Centre are ISO 27001 certified. RISK GOVERNANCE FRAMEWORK Governance Structure for Information Technology Board Sub-Committees IT Strategy Committee Risk Committee Audit Committee Executive Committees Information Technology (IT) Steering Committee Information & Cybersecurity Committee Business Continuity Management (BCM) Steering Committee Board of Directors Annual Report 2023-24 | 39 Integrated Report Statutory Reports Financial Statements Controls for IT Infrastructure Preventive Control y Application Security Life Cycle (ASLC), Vulnerability Assessment and Penetration Testing (VAPT), Antivirus, Vendor Risk y Assessment, Firewall, Intrusion Detection System (IDS) y Access Management y Distributed Denial of Service (DDoS) Mitigation Detective Control y Security Operation Centre (SOC) Monitoring y Web Application Firewall y Network Operation Centre (NOC) Monitoring y RED Teaming Exercises Responsive Control y Incident Response Plan y Cyber Crisis Management Plan (CCMP) y Forensic Agreements with Partners PARTICIPATION IN EXTERNAL CYBERATTACK SIMULATIONS The Bank conducts and participates in several cybersecurity attack simulation drills such as spear phishing drills on employees, Distributed Denial of Service (DDoS) attack drills for Internet Service Providers (ISPs), social engineering-based attacks on data centre staff to gain physical access etc. Business continuity and recovery drills are conducted to assess the Bank’s ability and readiness to combat disasters, to ensure continuity of critical business processes at an acceptable level and limit the impact of the disaster on people, processes and infrastructure. The Bank periodically conducts cyber maturity assessments through a third-party, which is a comprehensive risk assessment of the cybersecurity posture of the Bank. The Bank believes in providing services to its customers in the safest and in a secure manner, keeping in mind that protection of data of its customers is as important as providing quality banking services across the spectrum. The Bank also undertakes campaigns to create awareness among customers on security aspects while banking through digital channels. In view of rapid digitisation and growing cyber threats it is very critical to respond quickly and effectively when security incidents occur. The Bank has a dedicated Cybersecurity Incident Response Team (CSIRT) to respond security incidents following a well documented Incident Response Plan. Further, the Bank has a Disaster Recovery (DR) plan to ensure continuity of critical services to customers and availability of identified critical systems during significant disruptions. In the event of a disaster, the Bank endeavours to resume business and operations to an acceptable level as per the Recovery Time Objectives (RTOs) for the application. The efficacy of the DR plan is established through periodic DR drills. There were no material incidents of security breaches or data loss during fiscal 2024. RISK GOVERNANCE FRAMEWORK 40 | Annual Report 2023-24 ESG Governance Overarching Environmental, Social and Governance Policy • Broad Focus Areas y Responsible Financing y Environmental Sensitivity in the Bank’s Operations y Customers y Employees y Society y Corporate Governance y Cybersecurity and Data Privacy Governance Framework y Stakeholder Engagement and Accountability • Policy Available on the Bank’s Website Governance Structure Board of Directors - Annual Update Risk Committee - Semi Annual Reporting ESG Steering Committee - Quarterly Meetings Dedicated Team within CFO’s Office Team Tracks ESG and CSR Initiatives ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) During fiscal 2024, the Bank’s focus was on strengthening its sustainability practices and integrating ESG principles in its operations and strategy. Managing the Bank’s environmental impact and effective governance practices were key drivers of various initiatives undertaken during the year. The ESG Steering Committee, comprising functional heads across the Bank, continued to provide guidance and oversight on the ESG- related action plan for the year. The Risk Committee and the Board reviewed material ESG matters during fiscal 2024, and were provided updates on progress made on various ESG-related initiatives at the Bank. The Board-approved ESG Policy was reviewed and updated largely to reflect the progress made by the Bank during the year. ESG RATINGS The ESG practices of the Bank are evaluated by external rating agencies like Sustainalytics and MSCI. The improvement in the Bank’s ESG ratings is evidence of the progress being made across various areas. The ESG score by Sustainalytics improved from 23.9 to 22.5 within the Medium Risk category during fiscal 2024. MSCI rating is maintained at A during the year. The rating from CDP Worldwide is at C, which is the same as the Asian regional average. RISK GOVERNANCE FRAMEWORK Annual Report 2023-24 | 41 Integrated Report Statutory Reports Financial Statements ESG-related Developments During Fiscal 2024 • The Bank significantly increased the proportion of renewable energy in its total energy consumption from grid and on-site solar from 9% in fiscal 2023 to 35% in fiscal 2024. This was enabled through the procurement of green tariff power for the Bank’s facilities in Maharashtra and in Hyderabad. • The Bank’s total Scope 1 and 2 emissions declined by 15.7%, driven by a reduction in Scope 2 emissions by 19.7% during fiscal 2024. • Evaluation of the Bank’s Scope 3 emissions in own operations was expanded to include the upstream categories of capital goods and employee commuting, apart from business travel. • Better identification and management of risks relating to climate and ESG was an ongoing effort at the Bank, which involved sectoral analysis of hard-to-abate sectors to transition risks, and expanding the ESG risk assessment tool to more sectors. • Several communications relating to well-being were disseminated to employees through a dedicated portal, which included videos and webinars focussing on areas like health and fitness. The portal is also an avenue for employee volunteering in CSR activities. • Initiation of better monitoring and measurement of water and waste management efforts resulted in the BKC Service Centre (Corporate Office) getting a rating of ‘Net Zero Waste’ in the category of ‘Net Zero Waste to Landfill (Operations)’ by the Indian Green Building Council. • A dedicated section on ESG was introduced on the Bank’s website to improve disclosures on our sustainability journey. • Continuous engagement with internal stakeholders to build awareness and create capabilities. • The Bank has initiated efforts to strengthen the governance on ESG data collation and reporting. The Bank is committed to minimising the environmental impact of its operations and business. The Bank has set a target to become carbon neutral in its Scope 1 and Scope 2 emissions by fiscal 2032. More details are available in the Bank’s ESG Report and Business Responsibility and Sustainability Report (BRSR) for fiscal 2024 on the Bank’s website. RISK GOVERNANCE FRAMEWORK 42 | Annual Report 2023-24 RESPONDING TO RISKS AND OPPORTUNITIES The Bank recognises the importance of adopting a rigorous approach to understanding and responding to risks and opportunities that enables long-term value creation for all stakeholders. The Bank has a robust process to identify and monitor risks and respond appropriately. The Bank continuously reviews and enhances the methods for identification and assessment of risks, and sets appropriate metrics and controls, and mitigants for managing significant risks. In fiscal 2024, the Bank continued to monitor the risks it is exposed to, including economic, credit, market, liquidity and operational risks. Apart from these traditional risks, the Bank is also cognisant of emerging new-age risks due to climate change. The Bank has initiated steps to embed climate risk assessment and climate risk management as part of the Bank’s risk management framework. A dedicated team within the Risk Management Group has been set up for evaluating climate-related financial risks. The Bank has formulated a Climate Risk Management Framework (CRMF) for integration of climate risk into overall risk management framework and it guides on identifying and assessing the impact of both physical and transitional risks on the lending portfolio. The framework will undergo periodic reviews to ensure alignment with available regulatory climate risk guidance, reflecting the evolving understanding and assessment of climate risk. The Bank has also been participating in policymaking by providing inputs and supporting the regulator in assessing impact of climate change risks on specific sectors. Challenges posed by tightening monetary policy, withdrawal of liquidity by the central bank and exchange rate movements. Comprehensive policies and periodic reviews at the level of Board and committees; strategic priority towards asset liability management and strengthening the Bank’s liability franchise. Market and Liquidity Risk Risk Type Key Risks Our Response Uncertainties pertaining to elevated geopolitical risks, continuing high interest rates for longer periods and weak global growth outlook across the world posed challenges for customers. Ensured effective risk management across business segments, strengthened by ongoing reviews for early identification and stress testing; the Bank maintained strong capital and liquidity positions, which were significantly above regulatory requirements. Credit Risk Volatile economic environment driven by rising inflation, global monetary policy stance and geopolitical tensions. Continuously monitored developments in the global and Indian economy, including country risk and sector-specific risks and responded accordingly. Economic Risk Annual Report 2023-24 | 43 Integrated Report Statutory Reports Financial Statements Risk Type Key Risks Our Response A disruption on account of information technology failures, internal/external frauds, execution/delivery process errors, model errors or third-party dependencies. Effective risk management policies in the area of operational risk, information technology risk, third-party dependencies, model risk along with regular review and reporting/analysis of loss incidents. The Bank continues to focus on simplifying processes and platforms to minimise operational risk. Operational Risk Growing threat of cyberattacks combined with increasing digitisation of banking products and services could expose the Bank to security risks. The Bank also leverages partnerships with third parties and these could also be a source for information security risks. Investing on building resilience and effectively respond to cyberattacks; the Bank has laid significant focus on data privacy and data loss prevention mechanisms. There were no material incidents of security breaches or data loss during fiscal 2024. Cyber Risk The growing customer dependence on digital transactions and the rising volumes of such transactions requires banks to focus on the resilience, availability, scalability and security of our systems. Misalignment between business and IT strategies is a risk. The Bank is proactively investing in technology and improving its response to changing technological dynamics. The cross-functional governance framework and Board-level oversight ensures that information technology strategy is aligned with the business strategy with appropriate policies and control frameworks. The Bank has also been reviewing the opportunities and risks arising out of Generative AI framework and solutions for possible integration with applications currently used. The Bank’s IT systems were stable and largely uninterrupted during fiscal 2024. Technology Risk As a domestic systemically important bank (D-SIB), compliance with regulations and preparedness to evolving regulatory landscape is a key priority for the Bank. The Bank has established well-articulated policies and controls to ensure compliance with laws and regulations. Continuous evaluation and updating the policies and processes is done to remain relevant and compliant. A strong compliance culture driven by the Bank’s leadership is enabling timely action. Compliance Risk Retention of employees and ability to attract and motivate talented professionals is critical for the successful implementation of the Bank’s strategy and competing effectively. Provide opportunity for job rotation and enhance career growth and development; employee well-being and upskilling are key priorities. Employee Risk RESPONDING TO RISKS AND OPPORTUNITIES 44 | Annual Report 2023-24 MATERIALITY ASSESSMENT To determine the most material topics, a materiality assessment exercise was conducted by the Bank to identify key material topics for our stakeholders and business. Our latest materiality assessment was carried out in fiscal 2022. The five-step approach for assessing material issues involved: Stakeholder Identification Process for capturing internal and external perspectives by identifying key internal and external stakeholders by mapping their interests and role for the organisation Identifying the Universe of Relevant ESG Topics List of 23 topics identified based on discussions with internal stakeholders, peer review and benchmarking, sector research, media reports and secondary sources Stakeholder Consultation Developed a survey for capturing responses from diverse stakeholders Data Collection and Analytics Analysed the data and level of priority of every material topic for every stakeholder Calibration of Results Developed a materiality matrix to prioritise the topics into high, medium and low categories based on the order of preference listed by stakeholders Annual Report 2023-24 | 45 Integrated Report Statutory Reports Financial Statements 1 Compliance with regulations and other laws 2 Digital innovation/transformation 3 Data privacy and cybersecurity 4 Corporate governance and business ethics 5 Transparency and disclosures 6 Improving customer experience and satisfaction 7 Customer fairness and right-selling 8 Financial performance 9 Stability of risk management and risk outcomes 10 Leadership development and succession planning 11 Employee health and well-being 12 Board diversity including qualification/experience 13 Grievance redressal mechanism for stakeholders like customers and employees MATERIALITY MATRIX KEY MATERIAL ISSUES 14 Opportunities for learning, development and training for employees 15 Diversity and inclusion 16 Promoting financial inclusion, access and literacy 17 Social impact and governance evaluation in lending 18 Employee engagement and feedback mechanism 19 Promoting environment positive projects (e.g. lending to 'green' sectors) 20 Responsible sourcing and sustainable procurement practices 21 Participating in community development 22 Carbon emissions and resource efficiency in the Bank’s own operations 23 Exposure of the Bank to climate-related risks in its loan portfolio Importance to Internal Stakeholders Importance to External Stakeholders Environmental Social Governance 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 MATERIALITY ASSESSMENT 46 | Annual Report 2023-24 The Bank recognises the importance of maintaining a strong focus on issues material to its stakeholders. The nature and potential impact of these material issues may vary and change over time. The top 13 areas and the risks and opportunities are as given below: MATERIALITY ASSESSMENT Risks Being a domestic systemically important bank and among the top five listed entities (by market capitalisation) in India, we are exposed to various compliance requirements. The Bank has to ensure robust policies and processes, and there are no deficiencies in meeting evolving requirements on an ongoing basis. Any deficiency could lead to reputation risks and a breach of trust. Opportunities There is an opportunity to engage constructively with policy makers and advocate adoption of best practices for building resilience in the financial sector and supporting a growing economy. Risks The increasing volume of digital transactions requires us to ensure availability and scalability of systems. A misalignment between business and IT strategies is a risk. An elongated period of downtime in the Bank’s digital channels could lead to operational and reputation risks for the Bank. Opportunities Digital innovations provide an opportunity to differentiate our offerings, with seamless and secure customer experiences. This can provide competitive advantage and gain customer confidence. For more details kindly refer page 30 For more details kindly refer page 19 How We Are Responding We strive to be a responsible organisation with continued efforts at embedding a strong risk and compliance culture. The Bank remains vigilant of the evolving regulatory landscape, while ensuring that operations follow standards established by regulatory bodies. The Bank’s control functions ensure that businesses and operations are aligned with best practices. How We Are Responding We aspire to create digital innovations with rich need-based features and functionalities for customers. The Bank’s digital platforms have transformed to provide seamless digital journeys. Compliance with Regulations and Other Laws Digital Innovation/Transformation Annual Report 2023-24 | 47 Integrated Report Statutory Reports Financial Statements MATERIALITY ASSESSMENT Risks Lack of robust data governance practices could increase the risks of non-compliance, regulatory fines, financial losses and reputation risk. The cybersecurity landscape is also highly dynamic and exposes the Bank to significant challenges to ensure safety and security of customers’ money and personal identity. Opportunities Strong governance and a robust cybersecurity and data privacy strategy can create confidence in the institution and also differentiate us as a responsible organisation with customer interest paramount. Risks Ensuring strong governance practices and communicating the same across all levels in the Bank is important to build a culture that ensures business outcomes are delivered in the right manner and with responsibility. Banking is a business of trust, and failures caused by ethics, values and behaviours can cause reputation risk and could create significant costs to the Bank. Opportunities Embedding the right culture takes time to establish and begins with strong corporate governance and business ethics, which will ensure long-term sustainability of the organisation. For more details kindly refer page 35 and 38 For more details kindly refer page 30 How We Are Responding Dealing with cyber risks form an integral part of the Bank’s enterprise risk management framework. The Bank is committed to working towards aligning itself with the changing landscape and has a dedicated team for cyber/information risk management. The Bank will continue to invest in building resilience and to effectively respond to cyberattacks; the Bank has significant focus on data privacy and data loss prevention mechanisms. How We Are Responding We have established effective policies and frameworks that encourage employees to act in accordance with the highest professional and ethical standards. Regular communication and training of employees is also undertaken. Data Privacy and Cybersecurity Corporate Governance and Business Ethics 48 | Annual Report 2023-24 MATERIALITY ASSESSMENT Risks Transparency is integral to good governance. Ensuring transparency in our engagement with customers and providing information of our products and services can enable customers to take sound financial decisions. The Bank recognises the responsibility and importance to be honest in its dealings with stakeholders. Opportunities The Bank seeks to engage constructively and responsibly in its area of operations. This is critical to build trust in the Brand, and with direct consequences to our business. The Bank also aims to ensure fair and balanced disclosures of its financial performance, with additional relevant disclosures made as and when required. Risks Customer demands are evolving and digitisation has created new dimensions in banking services. Continuous value creation and superior banking experiences have become important considerations for customers. Lack of innovation and a customer-first approach could result in obsolete service delivery, meeting limited needs of customers and a loss of trust. Opportunities Digitisation and the rapid adoption of smartphones has given banks an opportunity to explore new ways of banking and providing customers with unique offerings and with convenience. For more details kindly refer page 32 How We Are Responding We recognise the criticality of transparency and disclosures, whether about the products we offer, our engagement with stakeholders or our contribution to society. The Bank aims to maintain robust governance and ethical and transparent relationship with all stakeholders. How We Are Responding Our Customer 360º approach and digital capabilities have strengthened the Bank’s value propositions for customers. Actively listening to our customers has helped improve the Bank’s offerings to customers, and reflects in the advocacy scores for the Bank. Transparency and Disclosures Improving Customer Experience and Satisfaction Annual Report 2023-24 | 49 Integrated Report Statutory Reports Financial Statements MATERIALITY ASSESSMENT Risks Failure to serve customer with appropriate product offering and conduct can lead to loss of trust and risk the reputation of the Bank. Opportunities Banking is a business based on trust, and requires high level of customer-appropriate conduct. Generating business while protecting the interests of customers contributes to attracting depositors and growth in business. Risks The Bank’s performance is closely associated with the growth in the Indian economy. Any significant challenges posed by the external environment and rapidly evolving regulations could pose a risk to the financial performance of the Bank. Opportunities The Bank’s approach is to identify opportunities across ecosystems and micromarkets by efficiently serving customers with 360º solutions as well as continue to engage with all key stakeholders. Consistent financial performance can encourage stakeholders to remain associated and help the Bank deliver on its vision to be a trusted financial partner for our customers. For more details kindly refer page 30 For more details kindly refer page 123 How We Are Responding The Bank’s philosophy of ‘Fair to Customer, Fair to Bank’ emphasises the need to deliver fair value to customers, including selling products and offer services which meet societal needs and are in the interest of customers. How We Are Responding Our strategic focus is to grow the profit before tax excluding treasury within the guardrails of risk and compliance. The Bank is fostering a strong risk and compliance culture to ensure a balance of risk and rewards and ethical engagement with its customers. We are investing in areas that are critical for improving productivity and operational efficiency. Customer Fairness and Right-Selling Financial Performance 50 | Annual Report 2023-24 MATERIALITY ASSESSMENT Risks The Bank is exposed to several risks and the ability to manage various types of traditional and emerging risks is critical for sustainable growth of the Bank. Opportunities Dynamic risk management and understanding the opportunities and challenges associated with participating in strategic opportunities is the bedrock for robust growth of business. For more details kindly refer page 36 How We Are Responding The Bank continuously reviews the operating environment and closely monitors significant risks that could impact business. The Bank’s Enterprise Risk Management and Risk Appetite Framework articulates the risk appetite, and drills down the same into a limit framework for various risk categories under which various business lines operate. Further, detailed and periodic reviews are conducted at various Board Committees on the portfolios and operations of the Bank. Risks Strong management development and succession planning are important for the successful implementation of our strategy and stability of the organisation. Opportunities Leadership development and commitment to attracting, developing and retaining a diverse and inclusive workforce can enable the Bank to deliver strong and consistent results. For more details kindly refer page 52 How We Are Responding The Bank has institutionalised a succession planning and leadership development initiative to identify and groom leaders for next-level roles. The Bank through the Senior Management Cover Index, tracks the depth of leadership bench at the senior management positions. The Bank has a strong bench for key positions and for critical leadership roles. Risks The climate challenge and a fast transition to a low carbon economy could give rise to new types of risks that may not be fully understood. Opportunities Using our financial expertise to provide capital to low- carbon sectors and new business opportunities in this space, based on appropriate risks and return assessment. We are committed to supporting customers as they decarbonise their business. For more details kindly refer page 66 How We Are Responding The Bank has been supporting capacity creation in environment-friendly areas, such as renewable energy, use of electric vehicles and development of green buildings, with an appropriate risk-return assessment. There is also a focus on promoting biodiversity and protecting our ecology through the Bank’s CSR initiatives. Promoting Environment Positive Projects Stability of Risk Management and Risk Outcomes Leadership Development and Succession Planning Annual Report 2023-24 | 51 Integrated Report Statutory Reports Financial Statements MATERIALITY ASSESSMENT Risks Assessing the environmental impact of the Bank’s own operations and facilities will be necessary to develop the Bank’s own roadmap towards carbon neutrality/net zero in own operations. Opportunities Being in the service industry, the carbon footprint from own operations is not expected to be significant and would be manageable. For more details kindly refer page 68 How We Are Responding The Bank is committed to minimising the environmental impact of its operations and facilities by adopting best practices and certifications for green building standards. It has committed to become carbon neutral in Scope 1 and 2 emissions by fiscal 2032. Carbon Emissions and Resource Efficiency in the Bank’s Own Operations Risks The impact of climate change poses tangible risks to the Bank’s own operations as well as business resilience of its borrowers. The consequences of climate change include both incremental effects (a long-term change in the mean and variability of climate pattern) and acute effects (increase in frequency and severity of extreme weather event). Assessing physical and transition risks are important to understand the impact of climate change events that can be felt across the Bank’s own operations as well as business models of its borrowers. Opportunities Significant opportunities are likely to emerge as efforts gain traction to meet commitments towards sustainable growth and transition to become carbon neutral or net zero. The Bank has been supporting sustainable and sustainability-linked projects in areas like renewable energy, electric vehicles, green buildings, sanitation, waste management, etc. based on an appropriate risk-return assessment. For more details kindly refer page 67 How We Are Responding The Bank has established adequate policies and frameworks for evaluating climate-related risks in the lending book. At the same time, assessment of the portfolio for climate risks, both physical and transition risks, for top corporate counterparties has been included as part of stress testing as well as capital planning exercise. Exposure of the Bank to Climate-Related Risks in its Loan Portfolio 52 | Annual Report 2023-24 HUMAN CAPITAL The Bank’s success is anchored by its people and a culture of ‘One Bank, One Team’ driving its business. The Bank’s human capital strategy is underpinned by key anchors of Fair Compensation, Learning and Growth, and Care. Our human capital strategy is designed with our focus on maximising risk-calibrated core operating profit based on the opportunities available across micromarkets and ecosystems. To capture the 360° banking needs of customers, every employee is encouraged to identify opportunities and drive business for the Bank. The Bank has aligned the organisation around micromarkets and customer ecosystems by increasing the density of leadership in key markets. The integration of the Bank’s businesses happens closer to the customer. This enables better understanding of customer needs at a micromarkets level. The corporate office operates as a service centre and the purpose of the central team is to serve the employees. The Bank encourages its employees to experiment and innovate to deliver services and create solutions for customers within the guardrails of risk and compliance. The Bank’s hiring philosophy is drawn from the cultural anchors of the Bank. The Bank believes in hiring for attitude and training for skills. Wherever required, the Bank uses personality inventories to better understand the work preferences/behaviours along with cultural fitment with the Bank’s values. FAIR COMPENSATION The Bank follows a prudent compensation practice under the guidance of the Board of Directors and the Board Governance Remuneration & Nomination Committee (the BGRNC or the Committee). The Compensation philosophy of the Bank is aligned to reward team performance. The Bank’s approach to compensation is intended to drive meritocracy within the framework of prudent risk management. The total compensation is a prudent mix of fixed pay and variable pay, which takes into account a mix of external market pay and internal equity. The fixed pay offered by the Bank, largely reflects pay for the role. The variable compensation is in the form of share- linked instruments or cash or a mix of cash and share- linked instruments. The cash component of variable pay (performance bonus) is aligned to the philosophy of ‘One Bank, One Team’ as it is based on overall performance of the Bank and reflects reward for team performance. The grant of share-linked instruments to eligible employees, reflects individual potential and criticality of position/ employee. During fiscal 2024, the Bank deepened the number of employees who were allotted share-linked compensation to around 18,350 employees. The compensation of staff engaged in all assurance functions like Risk, Compliance & Internal Audit depends on the achievement of key results of the respective functions and is independent of the business areas they oversee. LEARNING AND GROWTH The focus on a 360º customer-centric approach with an objective to serve customers in a holistic manner has underpinned the Bank’s operations. To deliver superior customer value, the Bank has invested in training its employees and enhancing their ability to comprehensively serve customers. This has enabled teams to be agile in responding to requirements of customers, and work collaboratively to create innovative and personalised products & solutions for customers. The Bank has a capability building architecture spanning across functional training, leadership development, digital and industry academia programmes to equip employees with the required skillsets. Industry Academia Partnerships The Bank has collaborated with academia partners to onboard a high quality, job-ready workforce. One of the key aspects of the industry academia programmes is the skills it builds in the banking, compliance, financial and digital services domains. These industry academia programs align new hires to the culture of the Bank and impart functional knowledge in banking and related subjects. Annual Report 2023-24 | 53 Integrated Report Statutory Reports Financial Statements HUMAN CAPITAL Apart from fresh graduates, existing employees at frontline levels can also enrol in ICICI Bank’s Probationary Officer programme and get inducted as Probationary Officers after completing the programme at ICICI Manipal Academy. The Bank has a Young Leaders Programme (YLP), where existing employees have the opportunity for higher education (Post Graduate Programme). Those who successfully complete this programme are deployed back into the Bank in managerial roles. The Bank is an employer of choice at premier management and engineering campuses across the country. The Bank continued its focus on Capability Building through its various academies. During April 1, 2023 to March 31, 2024, the Bank delivered an average of around 12 learning days of training per employee. Customer 360º Programme Customer 360º (C360) programme is designed for all Relationship Managers who join the Bank to inculcate C360 mindset. The objective is to take the entire Bank to the customer and provide end-to-end solutions to address customer needs. The programme provides comprehensive understanding of C360 focussing on product knowledge, building C360 in customer engagement through various scenarios, pertaining to relationship management, customer service, digital propositions and process & compliance. Once employees in relationship management roles complete the C360 programme, they have options to further deepen their knowledge in areas like trade products, business banking, asset products, etc. Risk and Compliance Workshops Risk and Compliance workshops are conducted for employees in business centres and other retail banking groups, Compliance Group and Wholesale Banking Group (including for Business Heads & Regional Heads) to equip them with the necessary skills to make decisions based on the principles set out in the risk and compliance framework of the Bank. The programme discusses various scenarios where the learners understand the approach in line with the risk and compliance framework. The session is also conducted as part of Branch Leadership Programme for new Branch Managers. Industry Academia Initiatives Post Graduate Programme in Relationship Management 21-day programme designed to develop a cadre of banking professionals adept in sales and relationship management ICICI Business Leadership Programme – PG Certificate in Securities Market 12-month programme designed to develop professionals for securities markets Ascend Programme Programme for graduates from top-tier institutes spread out over a year ICICI Bank Probationary Officers Programme 12-month programme designed to develop a pool of first-level managers with banking knowledge and required skillsets ICICI Young Leaders Programme (YLP) 12-month career acceleration programme designed for employees 54 | Annual Report 2023-24 Branch Leadership Programme Branch Leadership Programme is the Bank’s flagship training programme for new Branch Managers and Deputy Branch Managers. It is an instructor-led classroom programme focussed on inculcating the cultural framework of ICICI Bank along with detailing key aspects of their roles. The programme revolves around Customer 360º, ecosystem and micro-market concepts. Each programme provides opportunity to engage with senior management to build perspectives around Customer 360º, service orientation and operating within the risk and compliance norms of the Bank. The training covers ‘Go to market’ approach, branch profitability, risk and compliance, micro markets strategy, selling skills and relationship management, ecosystem banking, customer service, trade, transaction banking, institutional banking, business banking, overview of products and solutions with focus on digital adoption. Functional Academies In order to nurture talent and build domain-specific skills, ICICI Bank has deployed a wide range of functional academies which conduct several programmes. These academies cover new joinees to the Bank, new joinees to various roles and also refresher programmes for existing employees. These are designed around ICICI Bank cultural framework, business and functional skills, and also impart behavioural training as a part of the programme. The focus of functional induction programmes is to ensure that all employees who join the Bank have sufficient learning inputs which they can put into use on the field and supplement their on-the- job learning. Digital Academy In line with the vision of building a scalable, future-ready and data-driven organisation, the Bank continues on its journey of transformation from Bank to BankTech. To meet this objective, identified employees have been trained in skill domains like API (application programming interface) & micro services, cloud computing, data engineering, software engineering and project management. Programmes on cybersecurity, technology infrastructure, UI/UX design, artificial intelligence and software testing have also been rolled out for identified employees. In addition to the above programmes, the Bank conducted refresher programmes for employees in the areas of product, processes, compliance & on various technology systems. The Bank also conducted behavioural skilling in areas of personal effectiveness, interpersonal skill building, presentation skills and leading teams for identified employees. Capacity Building In line with regulatory expectation around Capacity Building in Banks, eligible employees in the areas of credit, accounting, risk and treasury, have been enrolled for certification with accredited institutes. Leadership Development Leadership Development Programmes and Leadership Engagement Sessions are conducted on a regular basis at the Bank. The ‘Ignite’ series is an ongoing initiative designed to keep the employees abreast with breakthroughs in the domains of leadership, digital transformation, data science and behavioural economics. The sessions provide an opportunity to teams to engage with domain experts and thought leaders in these areas. ICICI Bank also partners with thought-leaders across a wide spectrum of fields ranging from academia, management to sports, to engage with and build leadership perspectives. Under the umbrella of Leadership Academy, the Bank organises formal leadership development programmes on four identified themes of Technology, Data Science, Design Thinking and Project Management. Learning Assessment The objective of conducting learning assessment is to understand how design and delivery of training content may be improved. The Bank’s learning culture places a strong focus on confirming whether learners are indeed able to demonstrate understanding and application of basic concepts learnt in online and instructor-led functional programmes. This is generally in the form of an application-oriented test which is administered through Learning Matrix – the Bank’s internally managed learning platform. The universal passing criteria for all assessments HUMAN CAPITAL Annual Report 2023-24 | 55 Integrated Report Statutory Reports Financial Statements is 80%. The performance of employees on assessments is continually evaluated to fine-tune training content and for giving feedback to our internal facilitators. Academic Councils The Bank has constituted academic councils comprising senior leaders from various functions to meticulously design and oversee the curriculum and delivery of its key training programmes. These councils bring together a wealth of knowledge and experience from diverse areas such as retail banking, corporate finance, risk management, and technology, thus ensuring a holistic approach to employee development. By incorporating insights from different business units, the academic councils ensure that the training programmes are not only comprehensive but also aligned with the Bank’s strategic goals and dynamic needs of the business. Through continuous feedback and review mechanisms, the academic councils also play a pivotal role in the ongoing refinement and enhancement of the training initiatives, fostering a culture of continuous learning and professional growth within the organisation. Job Rotation and Moving Across Roles The Bank believes in investing in its employees to take up challenging assignments and responsibilities early in the career. The Bank’s ‘customer-oriented’ approach known as Customer 360°, encourages employees to take up new roles and not restrict themselves to specific areas. As a part of their career and skill development, the Bank offers opportunities to employees to explore diverse roles and functions. This provides employees the chance to explore and develop learning and expertise in different domains. Succession Planning The Bank has institutionalised a succession planning and leadership development initiative to identify and groom leaders for next level roles. The Bank has a robust succession planning process which, through the Senior Management Cover Index, tracks the depth of leadership bench at the senior management positions. The Bank has a strong bench for key positions and for critical leadership roles. CARE Employees play a pivotal role in the success of the Bank’s strategy and growth of the organisation. The Bank believes in providing an enabling work environment that helps employees to achieve aspirational goals. The Bank is an inclusive and a caring workplace, driven by meritocracy and equal opportunities for all. Employees at the Bank imbibe Officer Like Qualities (OLQ) at the workplace and in all internal and external engagements. These include respect for Brand ICICI, dignified behaviour in dealing with everyone, managers in position of authority can be demanding but not demeaning, being humble & service-oriented and having an attitude of learning. The Bank has a 24x7 emergency helpline, accessible to all employees of the Bank. This helpline facility has, over the years, provided crucial support to employees and their immediate family members during exigencies. To cater to emergencies, the Bank also has a dedicated Quick Response Team (QRT) to assist employees if they are in any distress. To facilitate quick medical attention for employees in medical emergencies, the Bank has tie-ups with more than 100 hospitals in key cities across the country. The Bank also provides comprehensive insurance coverage for all employees, across all grades. Group insurance facility includes both the Personal Accidental Insurance Scheme as well as the Group Life Insurance Scheme. The Bank also facilitates a Parental Insurance Scheme at preferential rates for its employees. ICICI Bank has also set in place a robust grievance handling mechanism to ensure that it is accessible to all employees. Known as I-Care, this centralised and dedicated team is equipped to handle employee queries and strives to provide a speedy resolution. The Bank’s philosophy of meritocracy and equal opportunity has led to a significant number of key positions being held by women employees over the last two decades. Conscious of life stage needs and safety of women employees, a range of benefits and policies have been curated. In addition to maternity leave, employees have access to child care leave and adoption leave. The Bank has a Travel Accompaniment Policy HUMAN CAPITAL 56 | Annual Report 2023-24 which allows women with young children to be accompanied by their child and a caregiver during official travel, with the cost borne by the Bank. The Bank also has a policy designed to provide financial support to employees who have children with special needs. Under this policy, the Bank covers expenses incurred on improving the quality of life of employee’s children with special needs through specialised education (at home or through a special-needs school), specialised therapy, specialised equipment and periodic treatment, if required (at hospital or at home). At the Bank, sexual harassment cases are handled as per the guidelines set under The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. The Bank has created awareness about the Act through mandatory e-learning at the time of induction. The Bank also regularly communicates with employees regarding the mechanism for raising complaints and the need for right conduct by all employees. The policy ensures that all such complaints are handled promptly and effectively with utmost sensitivity and confidentiality and are resolved within defined timelines. For other workplace issues, the Bank has a structured mechanism to resolve them. The iCare provides employees with a platform to deal with their queries and concerns. I-Care Service Platform Service and innovation lie at the heart of our commitment to employee satisfaction and operational efficiency. To deliver superior service at scale, our ethos of care and our strength of technology came together to craft an intuitive and seamless experience for our employees. Our proprietary system, iCare was launched in fiscal 2024 which has changed the way we manage employee enquiries and service requests. iCare integrates different channels, email, phone, chatbots and call centre over the same platform. Furthermore, it offers a ‘zero drop-off’ experience, ensuring that employee issues are attended to even if their assigned HR manager is on leave or busy. By harnessing the power of automation and AI, iCare has decreased turnaround time and improved access to employee services. Employees can avail these services through email, phone calls, or through ICICI Bank’s proprietary app – Universe on the Move. Empowering Women Employees HUMAN CAPITAL Travel Accompaniment Child Care Leave Adoption Leave Fertility Leave Maternity Leave Annual Report 2023-24 | 57 Integrated Report Statutory Reports Financial Statements EMPLOYEE CONNECT AND ENGAGEMENT ICICI Bank believes in creating a culture of free and open conversations. Forums of engagement have been created where employees can engage with senior leadership of the Bank and seek clarification on policy and strategy. Leadership Engagement Sessions The Bank’s senior management regularly engages with employees physically and virtually to emphasise the Bank’s cultural anchors including ethical conduct, adherence to regulations and compliance. Business centre visits are also an important part of the communication agenda. Employees are also kept updated on the strategy and performance and progress of the Bank through quarterly engagement on financial performance by the Executive Director with the leadership team. Conversation Sessions Through Conversation sessions, the Leadership Team engages with employees to emphasise on Bank’s cultural anchors. It helps in aligning employees to the ethos of the Bank. These sessions are also forums for employees to engage with Business leaders and serve as listening posts for the employees. I-Engage Onboarding sessions are conducted by Business and HR managers to induct all new hires to the Bank’s culture and systems. HUMAN CAPITAL Diversity, Equity and Inclusion ICICI Bank is committed to nurturing and promoting a culture of diversity, equity and inclusion (DE&I). Our inclusive culture, free from any biases, enables employees to work effectively. To maintain our culture of diversity and equity, the objectives of our DE&I initiatives are: • Promote a culture of DE&I across the Bank • Ensure that ICICI Bank continues to be an employer for diverse groups • Maintain an environment of inclusion for all its employees • Maintain a culture of no discrimination The Bank is also committed to promote and respect human rights. The Bank has put in place policies to provide an enabling and harassment-free work environment that respects and upholds individual dignity. The Bank’s Human Rights Policy is aligned with the United Nations Guiding Principles on Business and Human Rights (UNGP) and International Labour Organisation’s Declaration on Fundamental Principles and Rights at Work. 58 | Annual Report 2023-24 As an integrated workplace technology solution for HR and business transactions, the ‘Universe on the Move' (UOTM) mobile application makes life simple for employees every day – helping employees complete HR and business transactions on the go. Most employee services are available easily through the Universe on the Move app at the click of a button. What makes UOTM unique is that it also integrates business transactions – such as facility to provide business approvals or logging customer leads – in a seamless manner. DIGITAL@HR Universe on the Move – the employee app HUMAN CAPITAL Annual Report 2023-24 | 59 Integrated Report Statutory Reports Financial Statements ICICI Careers To attract the best talent, the Bank has created a digital careers platform to provide aspirants a seamless experience from the application stage to the onboarding stage. Candidates can easily apply for relevant jobs at the click of a button and be updated with real-time progress of their job application. At any juncture, candidates can reach out for support – through a comprehensive service platform integrating chat, calls and emails offering a seamless journey to aspiring ICICIans. ICICI Bank Alumni Portal The ICICI Bank Alumni Portal is a digital platform which provides ex-employees with a smooth relieving experience and access to important documentation after their exit from the Bank. With the evolving employee needs, the Bank is committed to serve employees with passion and care. Learning Matrix For any learning-focussed organisation, constant skilling, re-skilling, up-skilling and capability building are key factors to enable employees to serve evolving customer needs. The Learning Matrix is an AI-enabled digital learning platform with a rich online library and with features like leaderboard, social learning and access to curated open content. This AI-powered platform recommends personalised learning programmes and helps curate content based on in-platform feedback. The Learning Matrix offers an intuitive and engaging learning experience to employees on the go. AI/ML Functional Skill Start Learning iMobile Pay Modules Functional Skill Start Learning Excel in Excel: Graphs and Charts Functional Skill Start Learning Data Protection Functional Skill Start Learning ARTIFICIAL INTELLIGENCE & MACHINE LEARNING To access from Laptop/Desktop click Go to Course below Path for Learning Matrix mobile app: UOTM > App Drawer > Learning Matrix HUMAN CAPITAL 60 | Annual Report 2023-24 SOCIAL AND RELATIONSHIP CAPITAL An ongoing engagement with our stakeholders is important for the Bank to understand matters relevant to them and create sustainable value for all. The Bank continuously endeavours to understand the concerns and opinions expressed by stakeholders and respond to them promptly. The Bank holds regular interactions with customers, investors, employees, regulators and engages with communities and banking associations to remain informed. ENGAGING WITH OUR KEY STAKEHOLDERS Employees Employees are the most important capital for the success of our strategy and growth of the organisation. We believe in providing an inclusive workplace, driven by meritocracy and equal opportunities to all. How Do We Engage Engagement with employees is through various platforms including townhall sessions with directors, periodic communication meetings and business centre visits by senior leaders, videos to communicate with employees through the employee app, Universe on the Move, and query raising portal. Subjects considered important by our employees: • Risk and compliance culture • Enabling work culture with opportunities for growth and learning • Meritocracy • Responsive grievance handling process Our Response In the last two years, the Bank has significantly reorganised its workforce with new roles aligned to market opportunities. Promoting job rotation and encouraging employees to move across roles is helping the Bank in providing career growth to employees. The Bank believes in giving responsibility to young capable professionals ahead of time and supporting them in their next career move early in their professional journey. Learning and skill development is an important value proposition provided to employees. The focus of skill development initiatives is on digital, functional and behavioural learning. Principles of Diversity, Equity and Inclusion are embedded in HR practices at the Bank. The fair compensation policy aligns rewards with prudent risk taking. Care and well-being of employees is a key focus area and relevant policies and practices have been established in this regard. The Bank has a culture where employees can raise issues freely and can expect their grievances / concerns to be handled in a sensitive manner. For more details on the Bank’s HR practices, please refer to the Human Capital chapter on page 52 and the Business Responsibility and Sustainability Report. Annual Report 2023-24 | 61 Integrated Report Statutory Reports Financial Statements SOCIAL AND RELATIONSHIP CAPITAL Shareholders/Investors Society We believe that engaging with our shareholders and investors is important to understand market priorities and drive business outcomes that can lead to sustainable value-creation for all stakeholders. How Do We Engage There is continuous engagement with our investors and shareholders either through the annual general meeting, periodic conference calls, analyst day event, emails or one-to-one interactions. The Bank also has mechanisms to address queries and grievances of our shareholders and investors. Subjects considered important by our shareholders/investors: • Shareholder value creation • Medium and long-term strategy • Governance and ethical practices • Compliance • Operational resilience • Transparency • Disclosure on non-financial metrics like ESG Our Response During fiscal 2024, the Bank continued to deliver sustainable return on capital to shareholders. The Investor Relations team provides details on the performance and strategic objectives of the Bank during quarterly results calls and endeavours to enhance disclosures in the investor presentations on an ongoing basis depending on market conditions and investors’ feedback. Continuous engagement is ensured including meetings with the senior management. The team also facilitates engagement with investors on topics like Environmental, Social and Governance to provide insights with regard to the journey on sustainability in the Bank’s own operations and management of climate-related financial risks. The Bank is committed to contributing towards socio-economic development and, for the larger benefit of the society, is undertaking corporate social responsibility activities across the length and breadth of the country. How Do We Engage The Bank set up its philanthropic arm, ICICI Foundation for Inclusive Growth (ICICI Foundation), in 2008 for addressing critical gaps in socio-economic development, particularly in rural areas in India. Rural development initiatives are also being undertaken directly through the Bank’s efforts in promoting financial inclusion and inclusive growth. Subjects considered important by the society: The ICICI Foundation team extensively engages with local authorities and people to understand needs and development gaps. The key asks have been to address the need for health facilities, overcome water shortage and prevent environment degradation. Our Response During fiscal 2024, the Bank fulfilled its obligation of `5.17 billion towards CSR activities in compliance with the CSR rules under the Companies Act, 2013. The approach to undertake CSR activities included adopting a holistic approach at micro level to address developmental gaps and design comprehensive solutions underpinned by the objectives of sustainability and scalability. Environment and healthcare were major areas of focus for the Bank’s CSR activities in fiscal 2024. As a large financial institution, the Bank recognises the importance of engaging with its value chain partners on ESG. The Bank’s supplier code of conduct and also checklists on ESG factors for onboarding of new vendors are providing a basis for engaging with our vendors on these aspects and building awareness on the need for adopting green procurement standards and promoting social factors like human rights, diversity and inclusion. 62 | Annual Report 2023-24 Regulator Being a systemically important bank in India, ensuring resilience and stability is important for the Bank. How Do We Engage Our engagement with the regulators is ongoing, through periodic meetings and other forms of communications like emails, letters, etc. The Bank also participates constructively in policy forums organised by the regulators and also responds to policy-related discussion papers issued by the regulators. Subjects considered important by regulator: • Governance and building sound compliance culture • Fair treatment of customers and grievance redressal • Anti-money laundering and fraud risk • Operational and cyber resilience • Financial stability • Data, information and reporting quality Our Response The Bank has a dedicated team for communicating with regulators and responding to their specific requirements in a time bound manner. The Bank has well-defined processes and is leveraging technology to ensure monitoring and compliance to regulatory developments. The Bank has increased focus on building resilience and also participates in initiatives undertaken by the regulator. The Bank undertakes various awareness and training initiatives to enhance Bank’s focus towards customer conduct. Customers We are committed to understanding the requirements and expectations of our customers, and continuously engage with them to shape Customer 360º experiences. How Do We Engage We engage through multiple channels like their interaction with our frontline employees, structured surveys for seeking feedback, customer meets organised at business centres and channels available for raising queries and grievances. There are also quarterly interactions organised between customers and the Customer Service Committee of the Board. Subjects considered important by our customers: • Convenience • Responsive, skilled and considerate staff • Availability of relevant products and services • Quick resolution of queries, requests raised and grievance redressal • Secure and simplified delivery of services Our Response The Bank has put in place mechanisms to ensure customer needs are appropriately addressed and right-selling of products and services are ensured. Reiterating the principle of ‘Fair to Customer, Fair to the Bank’ in every communication to employees, the approach is to only offer products that meet requirements of a customer. In the past, the Bank has withdrawn products that could potentially lead to mis-selling and inconvenience the customer. In line with the above principle, the Bank has also moderated prepayment fee for certain products/segments. The Bank has a dedicated customer service team focussed on improving process efficiency, reducing customer effort and leveraging technology to enhance customer experience and response time. This is accompanied with continuous upskilling and knowledge building of staff. The Bank strongly follows a policy of zero tolerance to unethical conduct by employees. SOCIAL AND RELATIONSHIP CAPITAL Annual Report 2023-24 | 63 Integrated Report Statutory Reports Financial Statements CORPORATE SOCIAL RESPONSIBILITY (CSR) Social issues such as access to healthcare, prevention of environmental degradation, skill development and livelihood opportunities remain critical areas requiring support in India. Creating a thriving society and economy requires significant investments in these areas. The Bank, through its implementing arm, the ICICI Foundation for Inclusive Growth (ICICI Foundation), has focussed on creating a positive impact through its CSR initiatives and is working directly with communities and stakeholders to meaningfully contribute in these areas. The activities are also aligned with the United Nations (UN) Sustainable Development Goals (SDGs). During fiscal 2024, the Bank’s contribution towards social causes was `5.19 billion. The CSR initiatives were mainly in the areas of healthcare and sanitation, environmental and ecological projects, livelihood and social interventions focussed on meeting specific local needs. In the area of healthcare, support was extended for cancer care, cardiac care, eye care and trauma care by providing equipment, funds for surgeries, undertaking capacity building, organising eye screening camps and support for emergency care. In the area of environment and ecology, extensive watershed and rainwater harvesting projects were taken up during the year as part of water conservation projects. Till March 31, 2024, total water harvesting potential of about 25.8 billion litres has been created across rural India. The other area of extensive work done is in forest conservation. The initiatives on forest conservation and ecology included ensuring water availability, restoring habitat, enhancing biodiversity, preventing soil erosion, supporting afforestation and livelihood creation, and other green initiatives which included installation of renewable energy capacity for creating grid-free forests and supporting clean energy in villages. These efforts were across 53 forest reserves as on March 31, 2024. Successful rejuvenation of Alkoda Lake in Raichur District, Karnataka. Counselling by a child nutritionist at Cachar Cancer Care Hospital and Research Centre in Silchar, Assam. • More than 3.7 million trees have been planted till March 31, 2024. • The various CSR initiatives have created a positive impact for over 12.8 million beneficiaries. SOCIAL AND RELATIONSHIP CAPITAL 64 | Annual Report 2023-24 ICICI Foundation engaged with marginal and landless farmers and provided support for agricultural value chain development, livestock rearing and skill development for livelihood. This effort benefited about 80,000 individuals across various projects in fiscal 2024. As part of social interventions, projects were undertaken based on local needs and enabling community welfare and included activities such as development of infrastructure in remote areas, promotion of financial literacy, and improvement of access to education among marginalised communities. For more details on ICICI Foundation’s activities, refer to the Bank’s ESG Report for fiscal 2024. FINANCIAL INCLUSION AND RURAL DEVELOPMENT INITIATIVES There are specific segments of the rural economy that require a more supportive and sensitive response to their financial requirements and the Bank has taken initiatives to address the needs of such segments. The Self-Help Groups (SHGs) programme is an initiative that has contributed to entrepreneurship among women in the SOCIAL AND RELATIONSHIP CAPITAL rural areas. A comprehensive suite of banking products, including zero-balance savings account and term loans, for meeting the business requirements of the women of these SHGs is provided. Services are offered at their doorstep, thus saving their time, money and effort to visit the closest business centre. ICICI Bank has been extending loans/providing financial support to less privileged women of the country through Self Help Groups - Bank Linkage Programme (SHGs-BLP) for over a decade, to give a boost to their entrepreneurial spirit. These initiatives have positively impacted 10.49 million women across the country through approximately 8.9 lakh SHGs loans as on March 31, 2024. Of these, over 4.67 lakh were first-time borrowers, who had not taken a loan from any formal financial institution. These SHGs are engaged in livelihood-generating activities which are helping them scale up their economic enterprises and improve financial security. During fiscal 2024, the Bank availed USD 100 million from a financial institution for onward lending through its SHGs-BLP that aims to empower less privileged women in India to become self-reliant and to help them expand their businesses and enhance their earning capability. Members of an SHG in Palakurthy from Jangaon District, Telangana, being informed about SHG loans that they can avail from ICICI Bank. Locals using a footbridge in a village in Raesi District, Jammu constructed through ICICI Foundation’s efforts. Annual Report 2023-24 | 65 Integrated Report Statutory Reports Financial Statements In addition to direct customers, the Bank reaches out to about 2.2 million customers through microfinance institutions. The Bank also provides lending to Joint Liability Groups (JLGs), which are semi-formal groups from the weaker sections of society, through microfinance companies. These activities are undertaken within the overall framework prescribed by the RBI. The Bank also offers credit-related services to microfinance companies for onward lending to the rural population. At March 31, 2024, the Bank had over 21.1 million Basic Savings Bank Deposit Accounts (BSBDA), of which around 4.4 million accounts were opened under the Pradhan Mantri Jan Dhan Yojana. The Bank encourages and enables these account holders to transact digitally. Digital Banking Unit (DBU) Technology has played a key enabler in fostering financial inclusion. The delivery of financial services in remote unbanked and under-banked areas has been made possible due to digitisation. In fiscal 2023, the Government of India announced the launch of Digital Banking Units (DBU) with the objective of encouraging customers to undertake and experience the benefits of digital transactions. The DBUs are primarily fixed-point business units for delivering digital banking products and services, with most services made available in both self-service and assisted mode. The Bank set up four such DBUs which were launched in October 2022. Key performance parameters of the DBUs during April 2023 - March 2024 were as follows: List of Activities Number No. of accounts opened 1,517 No. of credit cards 839 No. of loans 259 Count of financial transactions 91,485 Count of non-financial transactions 16,511 No. of frauds Nil No. of grievances received 11 No. of digital awareness/literacy camps arranged 197 SOCIAL AND RELATIONSHIP CAPITAL 66 | Annual Report 2023-24 ENVIRONMENT AND SUSTAINABILITY Incorporating sustainability into the Bank’s operations and business is an ongoing process that supports our objective of minimising environmental impact and contributing towards a sustainable future. The Bank’s ESG Policy emphasises its commitment to conduct business sustainably and efficiently, thereby reducing the environmental impact. The Bank’s efforts in promoting environmental sustainability is in three strategic areas including sustainable financing, in its own operations and corporate social responsibility. SUSTAINABLE FINANCING The Bank recognises the role a financial institution can play in driving sustainable socioeconomic development that benefits all stakeholders. Consideration of ESG in the Bank’s lending decisions and risk management framework are important factors and various approaches have been implemented. The Bank’s sustainable lending portfolio, defined based on the Bank’s Framework for Sustainable Financing, continued to grow in fiscal 2024. At March 31, 2024, the Bank’s outstanding portfolio to sectors like renewable energy, electric vehicles, green certified real estate, waste management, water sanitation, positive impact sectors like lending to weaker section under priority sector norms was about `685.28 billion. The Bank’s green financing portfolio grew during fiscal 2024 and accounted for 28.3% of the total sustainable lending portfolio. The various approaches to assessment of ESG risks include social and environmental evaluation of project financing proposals, integrating climate change and ESG issues into the credit evaluation process, establishing framework for consistent and comprehensive tracking of sustainable lending by the Bank, and evaluating climate change impact in operations and business. Policies and frameworks are periodically reviewed for relevant amendments. The Social and Environmental Management Framework (SEMF) evaluates specific environmental and social risks as part of the overall credit appraisal process for assessing new project financing proposals. Key elements of the assessment include screening through an exclusion list drawn broadly from the lists published by the International Finance Corporation (IFC) and list of highly polluting sectors published by the Ministry of Environment, Forests & Climate Change (MoEFCC) in India, seeking a declaration from borrowers of compliance with applicable national environmental guidelines/approvals for qualifying proposals subject to threshold criteria defined in the SEMF, and due diligence by an independent agency for large-ticket project loans identified as per the criteria defined in the SEMF. Sustainable Financing Green financing portfolio was `193.66 billion at March 31, 2024, of which 50% was for financing renewable energy. Annual Report 2023-24 | 67 Integrated Report Statutory Reports Financial Statements Acknowledging the inherent risks posed by climate change and ESG issues, these aspects are being integrated into the credit evaluation process in the Bank. As part of the credit evaluation process for large corporate lending proposals, borrower ESG scores from external agencies, if available, are considered. Additionally, the Bank has developed specific risk assessment tools for 16 sectors to gauge the ESG maturity and associated risks of borrowers with exposures exceeding a certain threshold. This risk assessment tool has been developed with a focus on hard-to-abate sectors that are challenging to transition to low carbon pathways and sectors with substantial exposure within the Bank’s portfolio. One of the key elements of the Bank’s ESG policy is its commitment to responsible lending practices and fostering a positive impact on the environment and society. Aligned with this philosophy, the Framework for Sustainable Financing has been formulated to provide guidance on green, social, sustainable, and sustainability-linked lending, outlining the methodology and associated procedures. The Bank has taken inputs from the Government of India’s Framework for Sovereign Green Bonds issued in December 2022 and the RBI’s guidelines on Framework for Acceptance of Green deposits issued in April 2023. The Bank has further classification of proposals into (i) dedicated sustainable lending and (ii) sustainability-linked lending based on the underlying characteristics of the transaction. The framework specifies the eligibility criteria, applicable due diligence requirements, and the verification process for sustainable finance. The framework also aims to establish a consistent and comprehensive methodology for the classification and reporting of the Bank’s credit facilities as sustainable. Addressing Climate-Related Risks and Opportunities Exposure of financial institutions to potential negative impacts of climate change on operations, assets and overall financial stability are critical. The Bank’s approach to analysing climate risks include developing methods to integrate climate risk in the risk management framework and begin testing the resilience of the lending portfolio to climate risks which can be categorised into transition and physical risks. The Bank is also in the process of understanding biodiversity and nature-related aspects that could manifest as risks in the Bank’s business. The Bank has formulated a Climate Risk Management Framework (CRMF) for integration of climate risk into the overall risk management framework. CRMF comprises guidance on assessing impact of climate change on the Bank’s own operations due to physical risk events. Additionally, it guides in identifying and analysing the impact of both physical and transition risks on the lending portfolio. The Bank conducts climate scenario analysis to quantify the impact of climate-related financial risks and assess the potential impact on capital and provisions requirement. Climate scenario analysis is performed to assess the potential impact of physical risks on the top counterparties of wholesale banking portfolio, retail lending, and impact of transition risk on the top counterparties of wholesale banking portfolio. The output of the exercise has been incorporated in the Bank’s financial planning as a part of ICAAP. Physical Risk Assessment Bank’s Own Operations Top Counterparties of Wholesale Banking Portfolio Retail Portfolio ENVIRONMENT AND SUSTAINABILITY 68 | Annual Report 2023-24 Key Focus Areas for Addressing Climate Risks Sustainable Financing The Bank has developed a Framework for Sustainable Financing, which provides guidance on eligibility criteria for Sustainable/Sustainability- linked lending, guidance on assessment of facilities, monitoring and reporting of such facilities. This is the first step towards bringing sharper focus in the Bank’s sustainable lending practices. The Bank is also committed to extending its expertise to customers and policy makers for decarbonising businesses and the economy. Risk Management The Bank has formulated an approach to address risks emanating from climate change, as part of a Climate Risk Management Framework which comprises assessment of impact of climate change on the Bank’s own operations, climate risk management of the Bank’s loan book and integration of material climate risks into the existing risk management framework. Own Operations The Bank aims to reduce its Scope 1 and Scope 2 emissions. The Bank is in the process of evaluating Scope 3 emissions from own operations and enhancing its disclosure in this regard. The Bank is working towards identifying and putting in place the elements required to achieve carbon neutrality in own operations. The Bank has set a target to achieve carbon neutrality by fiscal 2032. To facilitate the above initiatives in the Bank, developing proficiency in understanding ESG-related risks and opportunities, and evaluation of ESG/climate related risks has been embedded into the training imparted to a core team within the risk management group and other critical functions. ENVIRONMENTAL SENSITIVITY IN OWN OPERATIONS The Bank’s efforts in minimising environmental impact of its activities is driven through sustainable practices in areas like energy efficiency, green building certification, sustainable procurement, waste reduction and recycling, water conservation and reducing paper consumption. During fiscal 2024, there was progress across these areas with a focus on decarbonising the Bank’s operations. Some key efforts during the year included: • The proportion of renewable energy within total energy consumption from the grid and on-site solar increased from 9% in fiscal 2023 to 35% in fiscal 2024. • The Bank continuously endeavours to align buildings to Indian Green Building Council (IGBC) standards and comply with them on an ongoing basis. During fiscal 2024, 29 new sites with more than half a million square feet of area were IGBC-certified. Total 32% of the Bank’s premises were IGBC-certified at March 31, 2024. • ICICI Bank has introduced several measures to enable waste reduction and recycling at its Service Centre at BKC in Mumbai, Maharashtra. These include appropriate measures for waste segregation at the site for suitable treatment according to the type of waste. The Bank has also advocated the use of environment-friendly consumables at the premises with the aim of promoting sustainable practices. These initiatives led to the Service Centre getting a rating of ‘Net Zero Waste’ in the category ENVIRONMENT AND SUSTAINABILITY Annual Report 2023-24 | 69 Integrated Report Statutory Reports Financial Statements of ‘Net Zero Waste to Landfill (Operations)’ by IGBC in fiscal 2024. • ICICI Bank was certified with ISO 45001:2018, Occupational Health and Safety Management Systems, at 18 large offices with cumulative occupancy of more than 30,000 employees (approx. 21% of total workforce). • The Bank has moved to using FSC (Forest Stewardship Council) certified recycled paper for pre- print forms at its branches. The Bank is also procuring BIS ECO-Mark paper that is manufactured through agro farming. These constituted 59% of the total paper procured by the Bank in volume terms. To facilitate the above, engagement with vendors is an ongoing effort to create awareness about the Bank’s approach on adoption of sustainable practices and to communicate the Bank’s intent to evaluate them on environmental and social factors. GHG EMISSIONS IN OWN OPERATIONS The adoption of green tariff power resulted in reduction in the Bank’s Scope 2 emissions by 19.7% year-on- year during fiscal 2024. The Bank’s total Scope 1 and 2 emissions declined by 15.7% during the year. The practice of independent assurance of Scope 1 and Scope 2 emissions continued. For fiscal 2024, reasonable assurance was conducted by Grant Thornton Bharat LLP as part of the SEBI mandated Business Responsibility and Sustainability Report. For fiscal 2023, limited assurance for the same was undertaken by DNV Business Assurance India Private Limited and, in fiscal 2022 it was conducted by TUV India Private Limited. During fiscal 2024, the Bank assessed and has disclosed additional categories under Scope 3 emissions. These include capital goods and employee commute, apart from business travel. ENVIRONMENT AND SUSTAINABILITY The Bank advocates the use of environment-friendly consumables at its premises with the aim of promoting sustainable practices. 70 | Annual Report 2023-24 Promoting Environment and Sustainability Through CSR As part of CSR initiatives, the Bank extensively supports efforts for environmental protection and improving biodiversity. Projects have been executed in the areas of water conservation, forest conservation and afforestation and protecting biodiversity, which are contributing towards restoring ecological balance in the country. ICICI Foundation is also working in villages to reduce their carbon footprint by promoting adoption of sustainable practices like composting, garbage recycling, efficient cooking, drinking water solutions, among others. ENVIRONMENT AND SUSTAINABILITY The Bank’s GHG emissions in its own operations in fiscal 2024 were: In ‘000 tCO2e Fiscal 2022 Fiscal 2023 Fiscal 2024 Scope 11 (A) 26 23 25 Scope 22 (B) 116 126 101 Total (A+B) 142 149 126 Emissions intensity (in tCO2e4 per ` crore revenue) 1.36 1.16 0.76 Emissions intensity (in tCO2e per FTE5 employee) 1.35 1.16 0.90 The Bank is committed to reduce its emissions in own operations and become carbon neutral by fiscal 2032. Footnote: 1. Scope 1 emissions include CO2 emissions from the combustion of fuel in diesel-generating sets and company-owned vehicles, emissions due to loss of refrigerants and emissions due to CO2 based fire extinguishers. The emissions from diesel-generating sets was estimated based on expenses on procurement of diesel and applying the lowest diesel price in the country to estimate quantity of diesel consumed. The emissions from fire extinguishers and owned vehicles was based on actual consumption. 2. Scope 2 emissions are due to electricity purchased from the grid. The estimation was based on actual consumption of electricity, and using the grid emission factor published by the Central Electricity Authority, India. 3. Scope 3 emissions for Capital goods have been estimated in accordance with the GHG Protocol. For the purpose, EXIOBASE 2019 emission factors have been considered. Scope 3 emissions for business-related travel by employees through modes like aircraft, train, buses, and cars have been estimated. Emissions from hotel stay during such travel is not included. For the purpose, DEFRA (Department for Environment, Food and Rural Affairs) 2023 emission factors have been considered. Scope 3 emissions for employee commuting have been estimated based on an survey conducted. The Average-data method has been used for extrapolating to all employees. For the purpose, latest India GHG Program emission factors have been considered. 4. tCO2e - Tonnes of carbon dioxide equivalent is a standard unit for counting GHG emissions. 5. FTE: Full Time Equivalent. Scope 3 Emissions Scope 33 emissions pertaining to Business travel was 17,735 tCO2e in fiscal 2023. In fiscal 2024, evaluation of the Bank’s Scope 3 emissions in own operations was expanded to include capital goods and employee commuting, apart from business travel. Total Scope 3 emissions in fiscal 2024 was 161,250 tCO2e. Annual Report 2023-24 | 71 Integrated Report Statutory Reports Financial Statements BOARD’S REPORT Your Directors have pleasure in presenting the Thirtieth Annual Report of ICICI Bank Limited (ICICI Bank/the Bank) along with the audited financial statements for the year ended March 31, 2024. FINANCIAL HIGHLIGHTS The financial performance for fiscal 2024 is summarised in the following table: ` in billion, except percentages Fiscal 2023 Fiscal 2024 % change Net interest income and non-interest income 820.12 972.55 18.6% Operating expenses 328.73 391.33 19.0% Core operating profit 491.39 581.22 18.3% Provisions and contingencies (excluding tax) 66.66 36.43 (45.3)% Profit before tax excluding treasury gains 424.73 544.79 28.3% Treasury gains (0.52) 0.09 (117.3)% Profit before tax 424.21 544.88 28.4% Tax 105.25 136.00 29.2% Profit after tax 318.96 408.88 28.2% ` in billion, except percentages Fiscal 2023 Fiscal 2024 % change Consolidated profit before tax and minority interest 472.55 615.08 30.2% Consolidated profit after tax and minority interest 340.37 442.56 30.0% DIVIDEND Your Bank has a consistent dividend payment history. Your Bank’s Dividend Distribution Policy is based on the profitability and key financial metrics, capital position and requirements and the regulations pertaining to the payment of dividend. The Board of Directors has recommended a dividend of ` 10.00 per equity share for the year ended March 31, 2024. APPROPRIATIONS The Bank has appropriated accumulated profit as follows: ` in billion Fiscal 2023 Fiscal 2024 Profit after tax 318.96 408.88 Profit brought forward 436.71 563.57 Accumulated profit (before appropriations) 755.67 972.45 Appropriations: To Statutory Reserve, making in all ` 538.00 billion 79.74 102.22 To Special Reserve created and maintained in terms of Section 36(1)(viii) of the Income Tax Act, 1961, making in all ` 184.70 billion 25.65 30.21 To Capital Reserve, making in all ` 150.75 billion 0.88 0.33 To Investment Fluctuation Reserve, making in all ` 31.69 billion1 1.04 9.93 To Revenue and other reserves, making in all ` 110.33 billion 50.00 - Dividend paid on equity shares2 34.79 55.99 Balance carried over to balance sheet 563.57 773.77 1 Represents an amount transferred to Investment Fluctuation Reserve (IFR) on net profit on sale of available-for-sale (AFS) and held- for-trading (HFT) investments during the period. The amount not less than the lower of net profit on sale of AFS and HFT category investments during the year or net profit for the year less mandatory appropriations is required to be transferred to IFR, until the amount of IFR is at least 2% of the HFT and AFS portfolio. The Bank can draw down balance available in IFR in excess of 2% of its AFS and HFT portfolio. 2 Represents dividend declared for previous financial year and paid in current financial year. BOARD’S REPORT 72 | Annual Report 2023-24 SHARE CAPITAL During the year under review, the Bank allotted 39,519,912 equity shares of ` 2.00 each pursuant to exercise of stock options under the ICICI Bank Employees Stock Option Scheme - 2000. For details refer to Schedule 1 of the financial statements. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS Pursuant to Section 186(11) of the Companies Act, 2013, the provisions of Section 186 of the Companies Act, 2013, except sub-section (1), do not apply to a loan made, guarantee given or security provided by a banking company in the ordinary course of business. The particulars of investments made by the Bank are disclosed in Schedule 8 of the financial statements as per the applicable provisions of the Banking Regulation Act, 1949. SUBSIDIARY, ASSOCIATE AND JOINT VENTURE COMPANIES During the year under review, ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank with effect from February 29, 2024. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank with effect from March 20, 2024 and a wholly- owned subsidiary of the Bank with effect from March 22, 2024. There were no entities which became or ceased to be joint venture of the Bank during fiscal 2024. As at March 31, 2024, your Bank had following subsidiaries (including step down subsidiaries) (17) and associate (8) companies: Name of the subsidiary company % of shares held ICICI Bank UK PLC 100 ICICI Bank Canada 100 ICICI Securities Limited 74.73 ICICI Securities Holdings, Inc.1 100 ICICI Securities, Inc.2 100 ICICI Securities Primary Dealership Limited 100 ICICI Venture Funds Management Company Limited 100 ICICI Home Finance Company Limited 100 ICICI Trusteeship Services Limited 100 Name of the subsidiary company % of shares held ICICI Investment Management Company Limited 100 ICICI International Limited 100 ICICI Prudential Pension Funds Management Company Limited3 100 ICICI Prudential Life Insurance Company Limited 51.20 ICICI Lombard General Insurance Company Limited 51.27 ICICI Prudential Asset Management Company Limited4 51.00 ICICI Prudential Trust Limited4 50.80 I-Process Services (India) Private Limited 100 1 ICICI Securities Holdings, Inc. is a wholly owned subsidiary of ICICI Securities Limited. 2 ICICI Securities, Inc. is a wholly owned subsidiary of ICICI Securities Holdings, Inc. 3 ICICI Prudential Pension Funds Management Company Limited is a wholly owned subsidiary of ICICI Prudential Life Insurance Company Limited. 4 The entity is a joint venture company, however, it is considered as a subsidiary company in accordance with the provisions of the Companies Act, 2013. Name of the associate company % of shares held NIIT Institute of Finance Banking and Insurance Training Limited 18.79 ICICI Merchant Services Private Limited 19.01 India Infradebt Limited 42.33 Arteria Technologies Private Limited 19.98 Rajasthan Asset Management Company Private Limited1 24.30 OTC Exchange of India1 20.00 Falcon Tyres Limited1 26.39 Fino Paytech Limited1, 2 25.10 1 These companies are not considered as associates in the financial statements, in accordance with the provisions of Accounting Standard 23 on ‘Accounting for Investments in Associates in Consolidated Financial Statements’. 2 The entity is considered as an associate under the Companies Act, 2013, subsequent to ICICI Lombard General Insurance Company Limited becoming a subsidiary of the Bank with effect from February 29, 2024. BOARD’S REPORT Annual Report 2023-24 | 73 Integrated Report Statutory Reports Financial Statements HIGHLIGHTS OF PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES AND THEIR CONTRIBUTION TO THE OVERALL PERFORMANCE OF THE COMPANY The performance of subsidiaries and associates and their contribution to the overall performance of the Bank as on March 31, 2024 is given in “Consolidated Financial Statements of ICICI Bank Limited - Schedule 18 - Note 12 - Additional information to consolidated accounts” of this Annual Report. A summary of key financials of the Bank’s subsidiaries is also given in “Statement Pursuant to Section 129 of the Companies Act, 2013” of this Annual Report. The highlights of the performance of key subsidiaries are given as a part of Management’s Discussion & Analysis under the section “Consolidated financials as per Indian GAAP”. The Bank will make available separate audited financial statements of the subsidiaries to any Member upon request. These documents/details will be available on the Bank's website at https://www.icicibank.com/about-us/ annual and will also be available for inspection by any Member or trustee of the holder of any debentures of the Bank. As required by Accounting Standard 21 issued by the Institute of Chartered Accountants of India, the Bank’s consolidated financial statements included in this Annual Report incorporate the accounts of its subsidiaries and other consolidating entities. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY AND ITS FUTURE OPERATIONS There are no significant and/or material orders passed by the regulators or courts or tribunals impacting the going concern status or future operations of the Bank. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE BANK There are no material changes and commitments affecting the financial position of the Bank which have occurred between the end of the financial year of the Bank to which the financial statements relate and the date of this Report. SCHEME OF ARRANGEMENT On June 29, 2023, the Board of Directors of the Bank and its broking subsidiary, ICICI Securities Limited (ICICI Securities) approved a scheme for delisting of equity shares of ICICI Securities, by issuing equity shares of the Bank to the public shareholders of ICICI Securities (in the swap ratio of 67:100), in lieu of cancellation of their equity shares in ICICI Securities, thereby making ICICI Securities a wholly-owned subsidiary of the Bank, under Regulation 37 of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021. Pursuant to receipt of requisite regulatory approvals and the order of the Hon’ble National Company Law Tribunals, meetings of the equity shareholders of the Bank and ICICI Securities were held on March 27, 2024, wherein the proposed scheme was approved by the requisite majority of shareholders. Certain shareholders of ICICI Securities have filed objections to the scheme and the scheme is currently pending for approval of the Hon’ble National Company Law Tribunals. Securities and Exchange Board of India (SEBI) has, through its letter dated June 6, 2024, issued administrative warning to the Bank on the outreach undertaken by the Bank regarding the scheme of arrangement. The Bank is in the process of complying with the requirements mentioned in the administrative warning. DIRECTORS AND OTHER KEY MANAGERIAL PERSONNEL Changes in the composition of the Board of Directors and other Key Managerial Personnel (KMP) The Board at its meeting held on May 28, 2023 and the Members at the AGM held on August 30, 2023 approved the following: (a) Re-appointment of Hari L. Mundra as an Independent Director of the Bank for a second term commencing from October 26, 2023 to October 25, 2024. (b) Re-appointment of B. Sriram as an Independent Director of the Bank for a second term commencing from January 14, 2024 to January 13, 2027. (c) Re-appointment of S. Madhavan as an Independent Director of the Bank for a second term commencing from April 14, 2024 to April 13, 2027. The Board also at its meeting held on May 28, 2023, based on the recommendation of the Board Governance, BOARD’S REPORT 74 | Annual Report 2023-24 Remuneration & Nomination Committee (BGRNC), approved the re-appointment of Sandeep Batra as Executive Director of the Bank for a further period of two years with effect from December 23, 2023 to December 22, 2025, subject to Reserve Bank of India (RBI) approval. The Board noted that this renewed term of two years is within the five years term as previously approved by the shareholders. RBI vide its letter dated December 20, 2023, communicated its approval for the re-appointment of Sandeep Batra as Executive Director of the Bank with effect from December 23, 2023 till December 22, 2025. The Members at the last AGM held on August 30, 2023 approved the re-appointment of Sandeep Bakhshi as Managing Director & Chief Executive Officer of the Bank for a period of three years with effect from October 4, 2023 to October 3, 2026, subject to approval of RBI. RBI vide its letter dated September 11, 2023 approved the re‑appointment of Sandeep Bakhshi as Managing Director & CEO of the Bank with effect from October 4, 2023 to October 3, 2026. The Board at its meeting on November 24, 2023, based on the recommendation of BGRNC, approved the appointment of Ajay Kumar Gupta as an Additional Director and whole-time Director (designated as Executive Director) with effect from November 27, 2023 or the date of approval from RBI, whichever is later, for a period till November 26, 2026. Pursuant to approval granted by RBI, Ajay Kumar Gupta was appointed as an Executive Director on the Board effective March 15, 2024 till November 26, 2026. The Members through Postal Ballot on May 14, 2024 approved the appointment of Ajay Kumar Gupta as a Director and Whole-time Director (designated as Executive Director) with effect from March 15, 2024 till November 26, 2026. The Board at its meeting held on February 15-17, 2024, based on the recommendation of BGRNC, approved the appointment of Pradeep Kumar Sinha as an Additional (Independent) Director, for a period of five years from February 17, 2024, subject to the approval of Members. The Board at the said meeting, based on the recommendation of BGRNC, also approved the appointment of Pradeep Kumar Sinha as the Non-executive Part-time Chairman with effect from July 1, 2024 or the date of approval from RBI, whichever is later, in the vacancy that would be caused by the retirement of Girish Chandra Chaturvedi. The Members through Postal Ballot on May 14, 2024 approved the appointment of Pradeep Kumar Sinha as an Independent Director for a term of five consecutive years commencing February 17, 2024 to February 16, 2029. RBI vide its letter dated May 24, 2024, approved the appointment of Pradeep Kumar Sinha as Part-time Chairman of the Bank for a period of three years with effect from July 1, 2024. The Board at its meeting held on June 29, 2024, based on the recommendation of BGRNC, approved the appointment of Rohit Bhasin as an Additional (Independent) Director for a period of five years, with effect from July 26, 2024. His appointment is being proposed in the Notice of the forthcoming AGM through item no. 7. The Board at its meeting held on June 29, 2024, based on the recommendation of BGRNC, approved the appointment of Punit Sood as an Additional (Independent) Director for a period of five years, with effect from October 1, 2024. The approval of the Members for his appointment will be sought through Postal Ballot. Anup Bagchi ceased to be a Director of the Bank with effect from close of business hours on April 30, 2023 pursuant to his appointment as Managing Director & Chief Executive Officer of ICICI Prudential Life Insurance Company Limited with effect from June 19, 2023. To ensure a seamless transition, he assumed the office of Executive Director & Chief Operating Officer of ICICI Prudential Life Insurance Company Limited with effect from May 1, 2023. The Board acknowledges the valuable contribution and guidance provided by Anup Bagchi. The Board at its meeting held on March 16, 2023, based on the recommendation of BGRNC, approved the appointment of Prachiti Lalingkar as the Company Secretary & Compliance Officer and KMP of the Bank effective April 1, 2023 pursuant to the superannuation of Ranganath Athreya in July 2023. As on the date of this report, in terms of Section 203(1) of the Companies Act, 2013, Sandeep Bakhshi, Managing Director & CEO, Sandeep Batra, Executive Director, Rakesh Jha, Executive Director, Ajay Kumar Gupta, Executive Director, Anindya Banerjee, Group Chief Financial Officer and Prachiti Lalingkar, Company Secretary are the Key Managerial Personnel of the Bank. Declaration of Independence All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149 of the Companies Act, 2013 as amended and BOARD’S REPORT Annual Report 2023-24 | 75 Integrated Report Statutory Reports Financial Statements Regulation 16 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (SEBI Listing Regulations) which have been relied on by the Bank and were placed at the Board Meeting held on April 27, 2024. In the opinion of the Board, the Independent Directors possess the requisite integrity, experience, expertise and proficiency required under all applicable laws and are independent of the Management. Retirement by rotation In terms of Section 152 of the Companies Act, 2013, Rakesh Jha would retire by rotation at the forthcoming AGM and is eligible for re-appointment. Rakesh Jha has offered himself for re-appointment. AUDITORS Statutory Auditors At the AGM held on August 30, 2023, M/s M S K A & Associates, Chartered Accountants (hereinafter referred to as M S K A & Associates) and M/s KKC & Associates LLP, Chartered Accountants (formerly M/s Khimji Kunverji & Co LLP), (hereinafter referred to as KKC & Associates LLP) were re-appointed as joint statutory auditors to hold office from the conclusion of the Twenty-Ninth AGM till the conclusion of the Thirtieth AGM of the Bank. M S K A & Associates and KKC & Associates LLP have been the joint statutory auditors of the Bank for three consecutive years, which is the maximum term for statutory auditors of banking companies as per the guidelines issued by RBI. Hence they would be retiring at the conclusion of the forthcoming AGM. The Audit Committee and the Board of Directors have placed on record their appreciation for the professional services rendered by M S K A & Associates and KKC & Associates LLP during their association with the Bank as its auditors. There are no qualifications, reservation or adverse remarks made by the joint statutory auditors in the audit report. As recommended by the Audit Committee, the Board has proposed the appointment of M/s. B S R & Co. LLP, Chartered Accountants and M/s. C N K & Associates LLP, Chartered Accountants as joint statutory auditors. Their appointment has been approved by RBI on May 15, 2024. The appointment of the auditors is being proposed to the Members in the Notice of the forthcoming AGM through item nos. 4 and 5. Secretarial Auditors Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board at its meeting held on June 29, 2023 appointed M/s.  Alwyn Jay & Co., a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Bank for fiscal 2024. The Secretarial Audit Report is annexed herewith as Annexure A. There are no qualifications, reservation or adverse remark or disclaimer made by the auditor in the report save and except disclaimer made by them in discharge of their professional obligation. The Annual Secretarial Compliance Report for fiscal 2024 is available on the website of the Bank at https://www. icicibank.com/about-us/disclosures-to-stock-exchanges and on the website of the stock exchanges i.e. BSE Limited (BSE) at www.bseindia.com and National Stock Exchange of India Limited (NSE) at www.nseindia.com. The Board at its meeting held on June 29, 2024, based on the recommendation of Audit Committee, approved the appointment of M/s. Alwyn Jay & Co. to undertake the Secretarial Audit of the Bank for fiscal 2025. Maintenance of Cost Records Being a banking company, the Bank is not required to maintain cost records as specified by the Central Government under Section 148(1) of the Companies Act, 2013. Reporting of Frauds by Auditors During the year under review, there were no instances of fraud reported by the statutory auditors, branch auditors and secretarial auditor under Section 143(12) of the Companies Act, 2013 to the Audit Committee or the Board of Directors. PERSONNEL The statement containing particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in an Annexure and forms part of this report. In terms of Section 136(1) of the Companies Act, 2013, the annual report and the financial statements are being sent to the Members excluding the aforesaid Annexure. The Annexure is available for inspection and any Member interested in obtaining a copy of the Annexure may write to the Company Secretary of the Bank. BOARD’S REPORT 76 | Annual Report 2023-24 INTERNAL CONTROL AND ITS ADEQUACY The Bank has adequate internal controls and processes in place with respect to its financial statements which provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements. These controls and processes are driven through various policies, procedures and certifications. The processes and controls are reviewed periodically. The Bank has a mechanism of testing the controls at regular intervals for their design and operating effectiveness to ascertain the reliability and authenticity of financial information. DISCLOSURE UNDER FOREIGN EXCHANGE MANAGEMENT ACT, 1999 The Bank has obtained a certificate from its statutory auditors that it is in compliance with the Foreign Exchange Management Act, 1999 provisions with respect to investments made in its consolidated subsidiaries and associates during fiscal 2024. RELATED PARTY TRANSACTIONS The Bank has a Board-approved Group Arm’s Length Policy which requires transactions with the group companies to be at an arm’s length. All the related party transactions between the Bank and its related parties, entered during the year ended March 31, 2024, were on arm’s length basis and were in the ordinary course of business. The details of material related party transactions at an aggregate level for the year ended March 31, 2024 are given in Annexure B. All related party transactions as required under Accounting Standard 18 are reported in note no. 47 of schedule 18 - Notes to Accounts of standalone financial statements and note no. 2 of schedule 18 - Notes to Accounts of consolidated financial statements of the Bank. The Bank has a Board-approved policy on Related Party Transactions, which has been hosted on the website of the Bank and can be viewed at https://www.icicibank.com/ about-us/other-policies. ANNUAL RETURN The Annual Return in Form No. MGT-7 will be hosted on the website of the Bank at https://www.icicibank.com/ about-us/annual. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT The Business Responsibility and Sustainability Report as stipulated under Regulation 34(2)(f) of the SEBI Listing Regulations will be hosted on the Bank’s website at https://www.icicibank.com/about-us/annual. Any Member interested in obtaining a copy of the Report may write to the Company Secretary of the Bank. The Bank has been releasing the Environmental, Social and Governance Report since fiscal 2020. The Report for fiscal 2024 will be hosted on the Bank’s website at https://www.icicibank.com/about-us/annual. INTEGRATED REPORTING The Bank has adopted the principles of the International Integrated Reporting Framework in its Annual Report since fiscal 2019. For accessing the Report for fiscal 2024, please refer to the Integrated Report section of the Annual Report 2023-24. RISK MANAGEMENT FRAMEWORK The Bank’s risk management framework is based on a clear understanding of various risks, disciplined risk assessment and measurement procedures and continuous monitoring. The Board of Directors has oversight on all the risks assumed by the Bank. Specific committees have been constituted to facilitate focused oversight of various risks, as follows: • The Risk Committee of the Board reviews, inter alia, risk management policies of the Bank pertaining to credit, market, liquidity, operational and outsourcing risks and business continuity management. The Committee also reviews the Risk Appetite and Enterprise Risk Management (ERM) frameworks, Internal Capital Adequacy Assessment Process (ICAAP) and stress testing. The stress testing framework includes a range of Bank-specific market (systemic) and combined scenarios. The ICAAP exercise covers the domestic and overseas operations of the Bank, banking subsidiaries and non-banking subsidiaries. The Committee reviews setting up of limits on any industry or country, migration to the advanced approaches under Basel framework, the proceedings of Group Risk Management Committee and the activities of the Asset Liability Management Committee. The Committee reviews the level and direction of major risks pertaining to credit, market, liquidity, operational, reputation, technology, BOARD’S REPORT Annual Report 2023-24 | 77 Integrated Report Statutory Reports Financial Statements information security, compliance, group and capital at risk as a part of the risk dashboard. The Risk Committee also reviews the Liquidity Contingency Plan for the Bank and the various thresholds set out in the Plan. • The Credit Committee of the Board, apart from sanctioning credit proposals based on the Bank’s credit approval authorisation framework, reviews developments in key industrial sectors (along with exposure to these sectors), the Bank’s exposure to large borrower accounts and borrower groups. The Credit Committee also reviews major credit portfolios, non-performing loans, accounts under watch, overdues, incremental sanctions etc. • The Audit Committee of the Board, provides direction to and monitors the quality of the internal audit function, oversees the financial reporting process and also monitors compliance with inspection and audit reports of RBI, other regulators and statutory auditors. • The Asset Liability Management Committee provides guidance for management of liquidity of the overall Bank and management of interest rate risk in the banking book within the broad parameters laid down by the Board of Directors/Risk Committee. • The Group Risk Management Committee (GRMC) oversees the group related risk management activities. GRMC inter alia, defines the frequency and framework for review of risk profile of group entities. Summaries of reviews conducted by these committees are reported to the Board on a regular basis. Policies approved from time to time by the Board of Directors/committees of the Board form the governing framework for each type of risk. The business activities are undertaken within this policy framework. Independent groups and subgroups have been constituted across the Bank to facilitate independent evaluation, monitoring and reporting of various risks. These groups function independently of the business groups/subgroups. The Bank has dedicated groups, namely, the Risk Management Group, Compliance Group, Corporate Legal Group, Internal Audit Group and the Financial Crime Prevention & Reputation Risk Management Group, with a mandate to identify, assess and monitor all of the Bank’s principal risks in accordance with well-defined policies and procedures. The Risk Management Group is further organised into Credit Risk Management Group, Market Risk Management Group, Operational Risk Management Group and Information Security Group. The Group Chief Risk Officer (GCRO) reports to the Risk Committee constituted by the Board which reviews risk management policies of the Bank. The GCRO, for administrative purposes, reports to an Executive Director of the Bank. The above mentioned groups are independent of all business operations and co-ordinate with representatives of the business units to implement the Bank’s risk management policies and methodologies. The Internal Audit Group acts independently and is responsible for evaluating and providing objective assurance on the effectiveness of internal controls, risk management and governance processes within the Bank and suggest improvements. The Internal Audit Group maintains appropriately qualified personnel to fulfill its responsibilities. The Internal Audit and Compliance groups are responsible to the Audit Committee of the Board. INFORMATION REQUIRED UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013 The Bank has a policy against sexual harassment and a formal process for dealing with complaints of harassment or discrimination. The said policy is in line with the requirements of ‘The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013’. The Bank has complied with provisions relating to the constitution of Internal Committee under the said Act. The details pertaining to number of complaints during the year has been provided below: (a) number of complaints filed during the financial year: 133 (b) number of complaints disposed off during the financial year: 133 (c) number of complaints pending1 at end of the financial year: Nil 1 All complaints received during fiscal 2024 have been closed within the applicable turnaround time (90 days). CORPORATE GOVERNANCE The corporate governance framework at ICICI Bank is based on an effective independent Board, the separation of the Board’s supervisory role from the executive management and the constitution of Board committees to oversee critical areas. At March 31, 2024, Independent BOARD’S REPORT 78 | Annual Report 2023-24 Directors constituted a majority on most of the committees and also chaired most of the committees. I. Philosophy of Corporate Governance At ICICI Bank, we are committed to maintain the highest standards of governance in the conduct of our business and continuously strive to create lasting value for all our stakeholders. We focus on maintaining comprehensive compliance with the laws, rules and regulations that govern our business and promote a culture of accountability, transparency and ethical conduct across the Bank. Group Code of Business Conduct and Ethics The Group Code of Business Conduct and Ethics for Directors and employees of the ICICI Group aims at ensuring consistent standards of conduct and ethical business practices across the constituents of the ICICI Group. This Code is reviewed on an annual basis and the latest Code is available on the website of the Bank at https://www.icicibank.com/managed-assets/docs/ personal/general-links/code_of_business_conduct_ ethics.pdf. Pursuant to the SEBI Listing Regulations, a confirmation from the Managing Director & CEO regarding compliance with the Code by all the Directors and senior management forms part of the Annual Report. Code of Conduct as prescribed under the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 In accordance with the requirements of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, the Bank has adopted the Code on Prohibition of Insider Trading. Material Subsidiaries In accordance with the requirements of the SEBI Listing Regulations, the Bank has formulated a Policy for determining Material Subsidiaries and the same has been hosted on the website of the Bank at https://www.icicibank.com/about-us/other-policies. The Bank does not have any material unlisted subsidiary. ICICI Prudential Life Insurance Company Limited (ICICI Life) is a material listed subsidiary of the Bank in terms of the provisions of the SEBI Listing Regulations. The additional details with regard to ICICI Life are as follows: Date of incorporation July 20, 2000 Place of incorporation Mumbai Statutory Auditors B S R & Co. LLP1 Chartered Accountants Firm Registration No. 101248W/ W-100022 Date of Re-appointment: July 17, 2019 Walker Chandiok & Co. LLP Chartered Accountants Firm Registration No. 001076N/ N500013 Date of Re-appointment: June 25, 2021 1 B S R & Co. LLP completed ten years and retired as the joint statutory auditor of ICICI Life at the conclusion of 24th  AGM of ICICI Life held on June 28, 2024. At the same AGM, M. P. Chitale & Co. (Firm Registration No. 101851) have been appointed as one of the joint statutory auditors of ICICI Life to hold office from the conclusion of 24th AGM of ICICI Life till the conclusion of 28th AGM of ICICI Life. Familiarisation Programme for Independent Directors Independent Directors are familiarised with their roles, rights and responsibilities in the Bank as well as with the nature of the industry and the business model of the Bank through induction programmes at the time of their appointment as Directors and through presentations on economy & industry overview, key regulatory developments, strategy and performance which are made to the Directors from time to time. The details of the familiarisation programmes have been hosted on the website of the Bank at https://www.icicibank.com/about-us/bod-1. Dividend Distribution Policy In accordance with Regulation 43A of the SEBI Listing Regulations, the Dividend Distribution Policy is hosted on the website of the Bank and can be viewed at https://www.icicibank.com/about-us/other- policies. Whistle Blower Policy The Bank has formulated a Whistle Blower Policy, which is periodically reviewed. The policy comprehensively provides an opportunity for any employee (including directors), secondees or stakeholders of the Bank to raise any issue concerning breaches of law, accounting policies or any act BOARD’S REPORT Annual Report 2023-24 | 79 Integrated Report Statutory Reports Financial Statements resulting in financial or reputation loss and misuse of office or suspected or actual fraud. The policy provides for a mechanism to report such concerns to the Audit Committee through specified channels. The policy has been periodically communicated to the employees and also posted on the Bank’s intranet. Issues raised under the Whistle Blower Policy or to senior management are investigated for appropriate action, including an assessment of the impact on financial statements, if any. The Whistle Blower Policy complies with the requirements of vigil mechanism as stipulated under Section 177 of the Companies Act, 2013 and other applicable laws, rules and regulations. The details of establishment of the Whistle Blower Policy/vigil mechanism have been disclosed on the website of the Bank at https://www. icicibank.com/about-us/other-policies. CEO/CFO Certification In terms of the SEBI Listing Regulations, the certification by the Managing Director & CEO and Chief Financial Officer on the financial statements and internal controls relating to financial reporting has been obtained. Details of utilisation of funds During the year under review, the Bank has not raised any funds through preferential allotment or Qualified Institutions Placement as specified under Regulation 32(7A) of the SEBI Listing Regulations. During the year under review, the Bank has raised ` 40,000.00 million through issue of senior unsecured redeemable long term bonds in the nature of debentures, in tranches, on private placement basis. There is no deviation in utilisation of the funds. Fees to statutory auditors The details of fees pertaining to services provided by the statutory auditors and entities in the network firm/network entity of which the statutory auditors are a part, to ICICI Bank Limited and its subsidiaries during the year ended March 31, 2024 are given in the following table: Nature of service Amount in `1 Audit 59,400,000 Certification and other audit related services 2,645,000 Total 62,045,000 1 Excludes taxes and out of pocket expenses. Recommendations of mandatory committees All the recommendations made by the committees of the Board mandatorily required to be constituted by the Bank under the Companies Act, 2013 and the SEBI Listing Regulations were accepted by the Board. Credit Rating as on March 31, 2024 Foreign currency denominated instruments issued by the Bank Instrument type Moody's S&P Senior unsecured medium term notes Baa3 BBB- Certificate of Deposits P-3 - Rupee denominated instruments issued by the Bank Instrument type CARE ICRA CRISIL Tier II bonds (Basel III) CARE AAA [ICRA] AAA - Additional Tier 1 bonds (Basel III) CARE AA+ [ICRA] AA+ CRISIL AA+ Unsecured redeemable bonds CARE AAA [ICRA] AAA CRISIL AAA Lower Tier II Bond CARE AAA [ICRA] AAA - Long term bonds issued by erstwhile ICICI Limited CARE AAA [ICRA] AAA CRISIL AAA Certificate of Deposits CARE A1+ [ICRA] A1+ - Fixed deposits CARE AAA [ICRA] AAA - Moody's: Moody's Investors Services S&P: S&P Global Ratings CARE: CARE Ratings Limited, India ICRA: ICRA Limited, India CRISIL: CRISIL Limited, India Certificate from a Company Secretary in practice In terms of the SEBI Listing Regulations, the Bank has obtained a Certificate from a Company Secretary in practice that none of the Directors on the Board of the Bank have been debarred or disqualified from being appointed or continuing as directors of companies by the Securities and Exchange Board of India/Ministry of Corporate Affairs or any such statutory authority. BOARD’S REPORT 80 | Annual Report 2023-24 The Certificate of Company Secretary in practice is annexed herewith as Annexure C. Board of Directors ICICI Bank has a broad-based Board of Directors, constituted in compliance with the Banking Regulation Act, 1949, the Companies Act, 2013 and the SEBI Listing Regulations and in accordance with good corporate governance practices. The Board functions either as a full Board or through various committees constituted to oversee specific operational areas. The Board of the Bank at March 31, 2024 consisted of thirteen Directors, out of which nine were Independent Directors and four were Executive Directors. There were ten Meetings of the Board during the year - April 22, May 28, June 29, July 22, September 15, October 21, November 24 and December 20 in 2023 and January 20 and February 15-17 in 2024. There were no inter-se relationships between any of the Directors. The names of the Directors, their attendance at Board meetings during the year, attendance at the last AGM and details of other directorships and board committee memberships held by them at March 31, 2024 are set out in the following table: Name of Director Board Meetings attended during the year Attendance at last AGM (August 30, 2023) Number of directorships Number of other committee member- ships 1 Directorships in other listed entity and category of directorship of other Indian public limited companies of other Indian companies Independent Directors Girish Chandra Chaturvedi, (Chairman upto June 30, 2024) (DIN: 00110996) 10/10 Present - - - - Pradeep Kumar Sinha (Director w.e.f. February 17, 2024, Chairman w.e.f. July 1, 2024) (DIN: 00145126) - N.A. 1 1 - Bharti Airtel Limited (ID) Neelam Dhawan (DIN: 00871445) 10/10 Present 3 2 4(2) • Hindustan Unilever Limited (ID) • Yatra Online Limited (NED) Uday Chitale (DIN: 00043268) 10/10 Present 1 1 1(0) ICICI Lombard General Insurance Company Limited (ID) Radhakrishnan Nair (DIN: 07225354) 10/10 Present 6 2 7(2) • ICICI Prudential Life Insurance Company Limited (ID) • ICICI Securities Primary Dealership Limited (ID) • Geojit Financial Services Limited (ID) • Inditrade Capital Limited (ID) BOARD’S REPORT Annual Report 2023-24 | 81 Integrated Report Statutory Reports Financial Statements Name of Director Board Meetings attended during the year Attendance at last AGM (August 30, 2023) Number of directorships Number of other committee member- ships 1 Directorships in other listed entity and category of directorship of other Indian public limited companies of other Indian companies Hari L. Mundra (DIN: 00287029) 10/10 Present 1 - 1(1) - B. Sriram (DIN: 02993708) 10/10 Present 5 1 6(1) • Nippon Life India Asset Management Limited (ID) • TVS Motor Company Limited (ID) • TVS Supply Chain Solutions Limited (ID) S. Madhavan (DIN: 06451889) 10/10 Present 4 3 7(3) • Sterlite Technologies Limited (ID) • HCL Technologies Limited (ID) • Procter & Gamble Health Limited (ID) • Eicher Motors Limited (ID) Vibha Paul Rishi (DIN: 05180796) 10/10 Present 5 - 6(3) • ICICI Prudential Life Insurance Company Limited (ID) • Asian Paints Limited (ID) • Tata Chemicals Limited (ID) • Piramal Pharma Limited (ID) Executive Directors Sandeep Bakhshi, Managing Director & Chief Executive Officer (DIN: 00109206) 10/10 Present - - - - Sandeep Batra (DIN: 03620913) 10/10 Present 4 - 3(0) • ICICI Lombard General Insurance Company Limited (NED) • ICICI Prudential Life Insurance Company Limited (NED) Rakesh Jha (DIN: 00042075) 9/10 Present 4 - 1(1) • ICICI Home Finance Company Limited (NED) • ICICI Lombard General Insurance Company Limited (NED) • ICICI Securities Limited (NED) Ajay Kumar Gupta (w.e.f. March 15, 2024) (DIN: 07580795) - N.A. - - - - Independent Director (ID) Non-executive Director (NED) One meeting of the Board was held and attended by Anup Bagchi (DIN:00105962) during his tenure on the Board of the Bank. 1 Includes only chairmanship/membership of Audit Committee and Stakeholders’ Relationship Committee of other Indian public limited companies. Figures in parentheses indicate committee chairpersonships. The profiles of the Directors can be viewed on the website of the Bank at https://www.icicibank.com/about-us/bod-1. BOARD’S REPORT 82 | Annual Report 2023-24 Skills/expertise/competence of the Board of Directors The Bank has identified the core skills/expertise/competence of the Board of Directors as required under Section 10A(2) (a) of the Banking Regulation Act, 1949 in the context of its business(s) and the sectors(s) for it to function effectively and has been in compliance with the same. The details of the core skills/expertise/competence possessed by the directors of the Bank is detailed as under: Name of Director Areas of expertise Girish Chandra Chaturvedi Agriculture and rural economy, Banking, Co-operation, Economics, Finance, Small Scale Industry, Human Resources, Risk Management, Business Management, Insurance Pradeep Kumar Sinha Agriculture and rural economy, Banking, Co-operation, Economics, Finance, Small Scale Industry, Payment and Settlement Systems, Human Resources, Risk Management, Business Management, Energy and Infrastructure, Urban Development Neelam Dhawan Banking, Information Technology, Human Resources, Business Management, Corporate Governance and Business Strategy Uday Chitale Accountancy, Banking, Finance, Alternate Dispute Resolution (ADR), Auditing & Assurance, Securities Radhakrishnan Nair Accountancy, Agriculture and Rural Economy, Banking, Co-operation, Economics, Finance, Law, Small Scale Industry, Payment and Settlement Systems, Human Resources, Risk Management, Business Management, Insurance, Securities, Treasury Management, Foreign Exchange Management, Information Technology, Investor Protection Hari L. Mundra Accountancy, Banking, Economics, Finance, Law, Human Resources, Risk Management, Business Management, Business and Financial Strategy, Treasury, M&A, Business Restructuring and Taxation B. Sriram Banking, Finance, Small Scale Industry, Information Technology, Payment and Settlement Systems, Credit and Risk, Treasury, Insolvency & Bankruptcy S. Madhavan Accountancy, Banking, Economics, Finance, Law, Information Technology, Human Resources, Risk Management, Business Management, Strategy, Business Operations, Governance, Taxation Vibha Paul Rishi Consumer Insight & Marketing, Strategy, Accountancy, Agriculture and rural economy, Economics, Finance, Information Technology, Human Resources, Risk Management, Business Management Rohit Bhasin (Director w.e.f. July 26, 2024) Accountancy, Banking, Finance, Human Resources, Risk Management and Business Management Sandeep Bakhshi Banking, Finance, Business Management, Insurance Sandeep Batra Accountancy, Banking, Finance, Law, Information Technology, Human Resources, Risk Management, Business Management, Insurance, Securities, Governance, Economics Rakesh Jha Banking, Business Management, Risk Management, Finance, Accountancy, Economics and Information Technology Ajay Kumar Gupta Banking, Business Management, Risk Management, Finance, Accountancy, Small Scale Industry, Payment and Settlement System and Information Technology BOARD’S REPORT Annual Report 2023-24 | 83 Integrated Report Statutory Reports Financial Statements The Board has constituted various committees, namely, Audit Committee, Board Governance, Remuneration & Nomination Committee, Corporate Social Responsibility Committee, Credit Committee, Customer Service Committee, Fraud Monitoring Committee, Information Technology Strategy Committee, Risk Committee, Stakeholders Relationship Committee and Review Committee for Identification of Wilful Defaulters/Non Co-operative Borrowers. The quorum of the Board committees was increased from at least two members to at least three members with effect from June 30, 2019, to transact business at any Board committee meeting and in case where the committee comprises of two members only or where two members are participating, then any Independent Director may attend the meeting to fulfil the requirement of three members. The terms of reference of the Board committees as mentioned above, their composition and attendance of the respective Members at the various committee meetings held during fiscal 2024 are set out below: II. Audit Committee Terms of Reference The Audit Committee provides direction to the audit function and monitors the quality of internal and statutory audit. The responsibilities of the Audit Committee include examining the financial statements and auditors’ report and overseeing the financial reporting process to ensure fairness, sufficiency and credibility of financial statements, review of the quarterly and annual financial statements before submission to the Board, review of management’s discussion & analysis, recommendation of appointment, terms of appointment, remuneration and removal of central and branch statutory auditors and chief internal auditor, approval of payment to statutory auditors for other permitted services rendered by them, reviewing and monitoring with the management the auditor’s independence and the performance and effectiveness of the audit process, approval of transactions with related parties or any subsequent modifications and utilization of loans and/or advances from/investment by the Bank in its subsidiaries. The Audit Committee also reviews the functioning of the Whistle-Blower Mechanism, adequacy of internal control systems and the internal audit function, compliance with inspection and audit reports and reports of statutory auditors, findings of internal investigations, management letters/letters on internal control weaknesses issued by statutory auditors/internal auditors, investment in shares and advances against shares. The Audit Committee responsibilities also include reviewing with the management the statement of uses/application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilised for the purposes other than those stated in the offer document/prospectus/notice and the report submitted by the monitoring agency, monitoring the utilization of proceeds of a public or rights issue and making appropriate recommendations to the Board to take steps in this matter, discussion on the scope of audit with external auditors, examination of reasons for substantial defaults, if any, in payment to stakeholders, valuation of undertakings or assets, evaluation of risk management systems and scrutiny of inter-corporate loans and investments. The Audit Committee is also empowered to appoint/oversee the work of any registered public accounting firm, establish procedures for receipt and treatment of complaints received regarding accounting, internal accounting controls and auditing matters and engage independent counsel as also provide for appropriate funding for compensation to be paid to any firm/advisors. In addition, the Audit Committee also exercises oversight on the regulatory compliance function of the Bank. The Committee also considers and comments on rationale, cost-benefits and impact of schemes involving merger/demerger/ amalgamation etc., on the Bank and its shareholders. The Audit Committee is also empowered to approve the appointment of the Chief Financial Officer (i.e., the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience and background, etc. of the candidate. Composition There were sixteen meetings of the Committee during the year - April 15, April 21, June 29, July 7, July 19, July 21, August 24, October 18, October 19, October 20, November 20 and December 14 in 2023 and January 17, January 19, February 24 and March 26 in 2024. The details of the composition of BOARD’S REPORT 84 | Annual Report 2023-24 the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended Uday Chitale, Chairman 16/16 S. Madhavan 16/16 Radhakrishnan Nair 16/16 III. Board Governance, Remuneration & Nomination Committee Terms of Reference The functions of the Committee include recommending appointments of Directors to the Board, identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down and recommending to the Board their appointment and removal, formulate a criteria for the evaluation of the performance of the wholetime/Independent Directors and the Board and to extend or continue the term of appointment of Independent Directors on the basis of the report of performance evaluation of Independent Directors, recommending to the Board a policy relating to the remuneration for the Directors, key managerial personnel and other employees, recommending to the Board the remuneration (including performance bonus and perquisites) to wholetime Directors and senior management personnel. The functions also include approving the policy for and quantum of bonus payable to the members of the staff including senior management and key managerial personnel, formulating the criteria for determining qualifications, positive attributes and independence of a Director, framing policy on Board diversity, framing guidelines for the Employees Stock Option Scheme/Employees Stock Unit Scheme and decide on the grant of options/units to employees and wholetime Directors of the Bank and its subsidiary companies. Composition There were seven meetings of the Committee during the year - April 21, 2023, May 28, 2023, July 20, 2023, October 20, 2023, November 23, 2023, January 19, 2024 and February 17, 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended Neelam Dhawan, Chairperson 7/7 Girish Chandra Chaturvedi (upto June 30, 2024) 7/7 Pradeep Kumar Sinha (w.e.f. February 23, 2024) - B. Sriram 7/7 Policy/Criteria for Directors’ Appointment The Bank with the approval of its BGRNC has put in place a policy on Directors’ appointment and remuneration including criteria for determining qualifications, positive attributes and independence of a Director as well as a policy on Board diversity. The policy has been framed based on the broad principles as outlined hereinafter. The Committee evaluates the composition of the Board and vacancies arising in the Board from time to time. The Committee while recommending candidature of a Director considers the special knowledge or expertise possessed by the candidate as required under the Banking Regulation Act, 1949. The Committee assesses the fit and proper credentials of the candidate and the companies/ entities with which the candidate is associated either as a director or otherwise and as to whether such association is permissible under RBI guidelines and the internal norms adopted by the Bank. For the above assessment, the Committee is guided by the guidelines issued by RBI in this regard. The Committee also evaluates the prospective candidate for the position of a Director from the perspective of the criteria for independence prescribed under the Companies Act, 2013 as well as the SEBI Listing Regulations. For a Non-executive Director to be classified as Independent he/she must satisfy the criteria of independence as prescribed and sign a declaration of independence. The Committee reviews the same and determine the independence of a Director. The Committee based on the above assessments makes suitable recommendations on the appointment of Directors to the Board. BOARD’S REPORT Annual Report 2023-24 | 85 Integrated Report Statutory Reports Financial Statements Remuneration policy The Compensation Policy of the Bank is in line with the RBI circulars and in compliance with the requirements for the Remuneration Policy as prescribed under the Companies Act, 2013. The Policy is divided into the segments, Part A, Part B and Part C where Part A covers the requirements for wholetime Directors & employees pursuant to RBI guidelines, Part B relates to compensation to Non-executive Directors (except Non-executive Part-time Chairman) and Part C relates to compensation to Non-executive Part-time Chairman. The Compensation Policy is available on the website of the Bank at https://www.icicibank. com/about-us/other-policies. The remuneration payable to Non-executive/ Independent Directors is governed by the provisions of the Banking Regulation Act, 1949, RBI guidelines issued from time to time and the provisions of the Companies Act, 2013 and related rules to the extent these are not inconsistent with the provisions of the Banking Regulation Act, 1949/RBI guidelines. The remuneration for the Non-executive/Independent Directors (other than Government Nominee Director) consists of sitting fee for attending each meeting of the committee/Board as approved by the Board. In addition to sitting fee, Non-executive Directors (other than Non-executive Part-time Chairman and the Government Nominee Director) (NEDs) are also entitled to a fixed remuneration. Considering the crucial role of NEDs in efficient functioning of bank Boards and its various committees and in order to enable the banks to sufficiently attract qualified competent individuals on their Board, RBI had, vide its circular dated February 9, 2024, revised the ceiling for fixed remuneration to NEDs from ` 2,000,000 per annum to an amount not exceeding ` 3,000,000 per annum, as may be decided by the Board of banks basis suitable criteria duly identified by it. The Board at its meeting held on February 15‑17, 2024 and the Members through Postal Ballot on May 14, 2024 approved the increase in fixed remuneration for Non-executive Directors (other than part-time Chairman and Government Nominee Director) with effect from February 10, 2024, from ` 2,000,000 per annum to ` 3,000,000 per annum. For the Non-executive Part-time Chairman, the remuneration, in addition to sitting fee includes such fixed payments as may be recommended by the Board and approved by the Members and RBI, maintaining a Chairman’s office at the Bank’s expense, bearing expenses for travel on official visits and participation in various forums (both in India and abroad) as Chairman of the Bank and bearing travel/ halting/other expenses and allowance for attending to duties as Chairman of the Bank and any other modes of remuneration as may be permitted by RBI from time to time. The Board at its meeting held on February 15-17, 2024 and the Members through Postal Ballot on May 14, 2024 approved the increase in fixed remuneration for the Non-executive Part-time Chairman from `  3,500,000 per annum to ` 5,000,000 per annum with effect from April 1, 2024. The increase in fixed remuneration has been approved by RBI. All the Non-executive/Independent Directors would be entitled to reimbursement of expenses for attending Board/committee meetings, official visits and participation in various forums on behalf of the Bank. Performance evaluation of the Board, Committees and Directors The Bank, on the recommendation of BGRNC and approval of the Board, has put in place a framework for evaluation of the Board, Directors, Chairperson and Committees. The evaluations for the Directors, the Board, Chairman of the Board and the Board level committees is carried out through circulation of different questionnaires, for the Directors, for the Board, for the Chairperson of the Board and the committees respectively. The performance of the Board is assessed on select parameters related to roles, responsibilities and obligations of the Board, relevance of Board discussions, attention to strategic issues, performance on key areas, providing feedback to executive management and assessing the quality, quantity and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform their duties. BOARD’S REPORT 86 | Annual Report 2023-24 The evaluation criteria for the Directors is based on their participation, contribution and offering guidance to and understanding of the areas which were relevant to them in their capacity as members of the Board. The evaluation criteria for the Chairperson of the Board besides the general criteria adopted for assessment of all Directors, focuses on leadership abilities, effective management of meetings and preservation of interest of stakeholders. The evaluation of the committees is based on assessment of the clarity with which the mandate of the Committee is defined, effective discharge of terms of reference of the Committees and assessment of effectiveness of contribution of the Committee’s deliberation/recommendations to the functioning/ decisions of the Board. The Bank has taken effective steps with regards to the action points arising out of performance evaluation process for fiscal 2023. The performance evaluation process for fiscal 2024 was conducted through a comprehensive survey using an electronic survey platform and was completed to the satisfaction of the Board. The Board of Directors also identified specific action points arising out of the overall evaluation which would be executed as directed by the Board. The evaluation process for wholetime Directors is further detailed in note no. 52 of Schedule 18 of the financial statements. Details of Remuneration paid to Executive Directors The BGRNC determines and recommends to the Board the amount of remuneration, including performance bonus and perquisites, payable to Managing Director & CEO and Wholetime Directors. The following table sets out the details of remuneration (including perquisites and retiral benefits) paid in fiscal 2024: Details of Remuneration (`) Sandeep Bakhshi Anup Bagchi1 Sandeep Batra Rakesh Jha Ajay Kumar Gupta2 2023-24 2023-24 2023-24 2023-24 2023-24 Basic 34,647,600 2,472,480 29,669,760 29,669,760 11,969,574 Performance bonus paid in fiscal 20233 28,480,666 24,844,962 24,844,962 21,291,253 12,521,333 Allowances and perquisites4 29,483,876 2,475,957 26,189,059 26,970,952 21,362,459 Contribution to provident fund 4,157,712 296,698 3,560,376 3,560,376 1,436,353 Contribution to superannuation fund - - - - - Contribution to gratuity fund 2,886,145 205,958 2,471,491 2,471,491 997,066 Stock options5 (Number) 299,100 231,000 231,000 231,000 113,700 1 Anup Bagchi's last working day with the Bank was April 30, 2023. The above remuneration pertains to his period in the Bank. 2 Ajay Kumar Gupta was appointed as Executive Director effective March 15, 2024. The above remuneration is his full year earned salary. 3 Bonus amounts earned for fiscal 2023 were subject to deferment policy of the Bank in-line with the regulatory stipulations. The above table represent payouts of the non-deferred portion of the bonus amount pertaining to fiscal 2023. The balance amount shall be equally deferred over a period of three years. The amounts also include the deferred portion of the bonus amount approved in earlier years that was paid during fiscal 2024. 4 Allowances and perquisites exclude perquisites of previous years stock options exercised during fiscal 2024 5 Represents options granted during fiscal 2024 pertaining to fiscal 2023. BOARD’S REPORT Annual Report 2023-24 | 87 Integrated Report Statutory Reports Financial Statements Perquisites (evaluated as per Income-tax rules, wherever applicable, and otherwise at actual cost to the Bank in other cases) such as the benefit of the Bank’s furnished accommodation, gas, electricity, furnishings, club fees, personal and group insurance, use of car, running and maintenance of cars including drivers, telephone/IT assets at residence or reimbursement of expenses in lieu thereof, payment of income-tax on perquisites by the Bank to the extent permissible under the Income-tax Act, 1961 and rules framed thereunder, medical reimbursement, leave and leave travel concession, education and other benefits, provident fund, superannuation fund, gratuity and other retirement benefits, in accordance with the scheme(s) and rule(s) applicable from time to time to retired wholetime Directors of the Bank or the members of the staff. In line with the staff loan policy applicable to specified grades of employees who fulfil prescribed eligibility criteria to avail loans for purchase of residential property, the Wholetime Directors are also eligible for housing loans. The stock options vest in a graded manner over a three-year period, with 30%, 30% and 40% of the grant vesting in each year, commencing from the end of 12 months from the date of the grant. The options so vested are to be exercised within 5 years from the date of vesting. The Bank does not pay any severance fees to its Managing Director & CEO or to its Wholetime Directors. The tenure of the office of Managing Director & CEO and the Wholetime Directors of the Bank is in the range of three to five years. The appointment is subject to approval of RBI and the Members. The notice period for each of them, as specified in their respective terms of appointments is two months. Neither the Managing Director & CEO nor the Wholetime Directors received any remuneration or commission from any of the subsidiary companies. During fiscal 2024, Sandeep Bakhshi exercised certain stock options of ICICI Life, subsidiary of the Bank which were granted to him in the earlier year(s) when he was associated with ICICI Life. The Bank does not have any holding company. Remuneration disclosures as required under the RBI Guidelines The remuneration related disclosures as required under the RBI Guidelines on Compensation of Whole Time Directors/Chief Executive Officers/Material Risk Takers and Control Function staff are disclosed in note no. 52 of Schedule 18 of the financial statements. Details of Remuneration to Non-executive Directors The Bank pays sitting fee of ` 100,000 to Non- executive Directors for attending each meeting of the Board and Board level committees viz. Audit Committee, Board Governance, Remuneration & Nomination Committee, Credit Committee, Corporate Social Responsibility Committee, Customer Service Committee, Fraud Monitoring Committee, Information Technology Strategy Committee, Stakeholders Relationship Committee, Risk Committee and Review Committee for identification of Wilful Defaulters/Non Co-operative Borrowers. Information on the total remuneration paid to each Non-executive Director during fiscal 2024 is set out in the following table: Amount (`) Name of Director Sitting Fees Remuneration1 Girish Chandra Chaturvedi 3,000,000 3,500,000 Pradeep Kumar Sinha2 100,000 241,758 Hari L. Mundra 4,800,000 2,000,000 S. Madhavan 4,100,000 2,000,000 Neelam Dhawan 2,900,000 2,000,000 Radhakrishnan Nair 3,800,000 2,000,000 B. Sriram 5,400,000 2,000,000 Uday Chitale 3,600,000 2,000,000 Vibha Paul Rishi 2,700,000 2,000,000 1 The Independent Directors of the Bank including Chairman receive sitting fees for attending each meeting of the Board/ committee as approved by the Board. The Board at its meeting held on February 15-17, 2024 and the Members through Postal Ballot on May 14, 2024 approved the increase in fixed remuneration payable to Non-executive Directors (excluding Part-time Chairman and Director nominated by Government of India) from ` 2,000,000 per annum to `  3,000,000 per annum with effect from February 10, 2024. The differential remuneration for the period with effect from February 10, 2024 till March 31, 2024 has been paid to the Non-executive Directors (other than Part-time Chairman) on proportionate basis in fiscal 2025. 2 Appointed as an Independent Director with effect from February 17, 2024. BOARD’S REPORT 88 | Annual Report 2023-24 Disclosures required with respect to Section 197(12) of the Companies Act, 2013 The ratio of the remuneration of each director to the median employee’s remuneration and such other details in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and as amended from time to time. (i) The ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year; Independent Directors1 Girish Chandra Chaturvedi, Chairman 11.05:1 Pradeep Kumar Sinha2 0.58:1 Hari L. Mundra 11.56:1 S. Madhavan 10.37:1 Neelam Dhawan 8.33:1 Radhakrishnan Nair 9.86:1 B. Sriram 12.58:1 Uday Chitale 9.52:1 Vibha Paul Rishi 7.99:1 Executive Directors Sandeep Bakhshi, Managing Director & CEO 120:1 Sandeep Batra 104:1 Rakesh Jha 104:1 Ajay Kumar Gupta3 104:1 (ii) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year; Sandeep Bakhshi, Managing Director & CEO 4% Sandeep Batra, Executive Director 4% Rakesh Jha, Executive Director 4% Ajay Kumar Gupta, Executive Director4 10% Anindya Banerjee, Group Chief Financial Officer 5% Prachiti Lalingkar, Company Secretary 30% (iii) The percentage increase in the median remuneration of employees in the financial year; The percentage increase in the median remuneration of employees in the financial year was around 12.6%. (iv) The number of permanent employees on the rolls of company; The number of employees, as mentioned in the section on ‘Management’s Discussion & Analysis’ is 141,009. Out of this, the employees on permanent rolls of the Bank are 135,900 including employees in overseas locations. (v) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration; The average percentage increase made in the salaries of total employees other than the Key Managerial Personnel for fiscal 2024 was around 13%, while the average increase in the remuneration of the Key Managerial Personnel was in the range of 4%- 30%4. (vi) Affirmation that the remuneration is as per the remuneration policy of the company. Yes Notes: 1 The Independent Directors of the Bank including Chairman receive sitting fees for attending each Meeting of the Board/Committee as approved by the Board. The ratio of remuneration as stated in point (i) above is calculated after considering sitting fees and fixed remuneration paid during fiscal 2024. The Board at its meeting held on February 15-17, 2024 and the Members through Postal Ballot on May 14, 2024 approved the increase in fixed remuneration payable to Non-executive Directors (excluding Part-time Chairman and Director nominated by Government of India) from ` 2,000,000 per annum to ` 3,000,000 per annum with effect from February 10, 2024, subject to the approval of Members. The differential remuneration for the period with effect from February 10, 2024 till March 31, 2024 has been paid BOARD’S REPORT Annual Report 2023-24 | 89 Integrated Report Statutory Reports Financial Statements to the Non-executive Directors (other than Part-time Chairman) in fiscal 2025. 2 Director with effect from February 17, 2024. 3 The ratios are computed on annualized remuneration in the capacity of Executive Director, which was effective March 15, 2024 for Ajay Kumar Gupta. 4 Ajay Kumar Gupta was appointed as Executive Director of the Bank effective March 15, 2024 with the salary increase of 108%. 5 Anup Bagchi’s last working day with the Bank was April 30, 2023. The ratio of his annualized remuneration to the median remuneration of the employees was 104:1 and the percentage increase in his remuneration was 4%. Particulars of Senior Management Personnel (SMP) (a) Changes in SMP during fiscal 2024 Atul Kumar, Divyesh Shah, Manish Maheshwari, Pankaj Kohli, Prachiti Lalingkar, Pramod Dubey, Rohit Poddar, Shamala Potnis, Swanandi Phalnikar and Vikas Singhvi were included in the list of senior management based on the eligibility criteria approved by the Board. Rajesh Nair, Saurabh Singh, Sudipta Roy, Ranganath Athreya, Vandana Jogani and Vishal Batra, were excluded from the list of senior management either owing to their retirement/resignation from the Bank or changes in the organization structure. Ajay Kumar Gupta was a senior management personnel for a period till March 14, 2024. (b) List of SMP as on March 31, 2024 Anindya Banerjee (Group Chief Financial Officer), Anish Madhavan (Group Chief Internal Auditor and Head Financial Crime Prevention), Anubhuti Sanghai (Head - Transaction Banking, Supply Chain Finance and Retail Trade Products), Anuj Bhargava (Head - Global Clients Group, Multi National Clients, Public Sector Undertaking and Advisory), Atul Arora (Head - Assets, Priority Sector Lending and Debt Service Management Group), Atul Kumar (Head - Payment Operations Group), Balaji V.V. (Chief Technology Officer), Bijith Bhaskar (Head - Cards, Payment Solutions, E-Commerce Ecosystem, Merchant Ecosystem and Consumer Finance), Divyesh Shah (Head - Operations Innovation, Digitisation, Analytics and Customer Relationship Management), G  Srinivas (Chief Risk Officer), Hitesh Sachdev (Head – Start Up Engagement and Investments), Manish Maheshwari (Head - Treasury & Securities Services Group), Nilanjan Sinha (General Counsel), Pankaj Kohli (Head - Business Credit and Credit Policy – Business Banking), Partha Dey (Head - Services Sector; Retail Structured Finance and Financial Institutions Group), Prachiti Lalingkar (Company Secretary), Pramod Dubey (Head - Assets & Liabilities Operations), Pranav Mishra (Head - Customer 360, Deposits Products, Business & Service Centre Processes & Compliance, Marketing & Alliances and ATM), Prasanna Balachander (Group Head - Global Markets - Sales, Trading and Research), Pravendra Shah (Chief of Internal Vigilance), Rajesh Iyer (Head - Private Banking), Rajesh Rai (Business Head - Retail and Business Banking), Rohit Poddar (Head – Retail Credit & Credit Policy - Retail Banking and Mortgage Valuation Group), Sanjay Singhvi (Head - Trust Association Societies & Clubs and Government Banking Group), Shamala Potnis (Head - Central Reconciliation), Sidharatha Mishra (Head - Wealth, Digital Channels & Partnerships and Customer Service), Sriram Hariharan (Head - International Banking Group, Global Remittances and NRI Services), Subir Saha (Group Chief Compliance Officer), Sujit Ganguli (Head - Corporate Brand and Communications), Sumit Sanghai (Head - Large Clients Group, Capital Markets, Construction Realty & Funding Group, Asset Evaluation & Monetization, Custody and Financial Sponsors), Swanandi Phalnikar (Head - Trade Finance Operations Group), T K Srirang (Group Chief Human Resources Officer and Head Infrastructure Management & Services Group), Vikas Agarwal (Head – Financial Sponsors and Syndications), Vikas Singhvi (Head - Retail Remittance and International Operations), Vyom Upadhyay (Head - Data Science and Analytics). IV. Corporate Social Responsibility Committee Terms of Reference The functions of the Committee include review of corporate social responsibility (CSR) initiatives undertaken by the ICICI Group and the ICICI Foundation for Inclusive Growth, formulation and recommendation to the Board of a CSR Policy BOARD’S REPORT 90 | Annual Report 2023-24 indicating the activities to be undertaken by the Bank and recommendation of the amount of expenditure to be incurred on such activities, identifying the focus, from among the themes specified in Schedule VII of the Companies Act, 2013, for initiatives to be undertaken by the Bank, reviewing and recommending the annual CSR plan to the Board with details of CSR initiatives and projects and schedule of implementation, monitoring the CSR activities, implementation and compliance with the CSR Policy, reviewing the submissions to be made to the Board with respect to implementation of the annual CSR action plan including the disbursement of funds for the purposes and manner as approved, implementation of on‑going projects as per approved timelines and year-wise allocation of funds, any modifications to be suggested to on- going projects, earmarking unspent CSR amount, if any, in subsequent periods as prescribed in the Companies Act, 2013 and suggest deployment of any amount spent in excess of the requirement for set-off in subsequent years, reviewing impact assessment of projects, and reviewing and implementing, if required, any other matter related to CSR initiatives as recommended/suggested by RBI or any other body. Composition There were four meetings of the Committee during the year - April 20, 2023, July 21, 2023, October 19, 2023 and January 18, 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended Girish Chandra Chaturvedi, Chairman (upto June 30, 2024) 4/4 Pradeep Kumar Sinha (w.e.f. February 23, 2024) - Radhakrishnan Nair 4/4 Uday Chitale 4/4 Vibha Paul Rishi 4/4 Anup Bagchi (upto April 30, 2023) 1/1 Rakesh Jha (w.e.f. May 1, 2023) 3/3 The Board at its meeting held on June 29, 2024 reconstituted the Committee and appointed Pradeep Kumar Sinha as the Chairman of the Committee with effect from July 1, 2024. Details about the policy developed and implemented by the Company on CSR initiatives taken during the year ICICI Bank has a long-standing commitment towards socio-economic development through CSR initiatives. The CSR Policy sets the framework guiding the CSR activities to be undertaken. The CSR activities are primarily in the areas of healthcare, environment and ecology, sustainable livelihoods and skilling, social interventions including financial literacy, social awareness and other activities as may be permitted under applicable law. The activities are implemented either directly or through the ICICI Foundation for Inclusive Growth. The CSR policy was reviewed and updated in June 2024 to facilitate the Bank’s endeavour to take up multi-year CSR projects to make sustainable impact. The CSR policy has been hosted on the website of the Bank at https://www.icicibank.com/ about-us/corporate-social-responsibility. The Annual Report on the Bank’s CSR activities is annexed herewith as Annexure D. V. Credit Committee Terms of Reference The functions of the Committee inter alia includes review of developments in key industrial sectors, major credit portfolios and approval of credit proposals as per the authorisation approved by the Board. Composition There were thirty-one meetings of the Committee during the year - April 11, April 27, May 9, May 17, June 9, June 23, June 30, July 14, July 28, August 3, August 9, August 17, August 29, September 12, September 21, September 29, October 13, October 26, November 9, November 20, November 28, December 22 and December 29 in 2023 and January 12, January 24, February 7, February 14, February 29, March 11, March 26 and March 30 in 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: BOARD’S REPORT Annual Report 2023-24 | 91 Integrated Report Statutory Reports Financial Statements Name of Member Number of meetings attended Sandeep Bakhshi, Chairman 31/31 Hari L. Mundra 29/31 B. Sriram 31/31 Rakesh Jha (w.e.f. May 1, 2023) 29/29 Anup Bagchi (upto April 30, 2023) 2/2 VI. Customer Service Committee Terms of Reference The functions of this Committee include review of customer service initiatives, overseeing the functioning of the Standing Committee on Customer Service (Customer Service Council) and evolving innovative measures for enhancing the quality of customer service and improvement in the overall satisfaction level of customers. Composition There were four meetings of the Committee during the year - May 17, 2023, August 8, 2023, November 9, 2023 and February 14, 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended Vibha Paul Rishi, Chairperson 4/4 Hari L. Mundra 4/4 Sandeep Bakhshi 3/4 Rakesh Jha 4/4 VII. Fraud Monitoring Committee Terms of Reference The Committee monitors and reviews all the frauds involving an amount of ` 10.0 million and above with the objective of identifying the systemic lacunae, if any, that facilitated perpetration of the fraud and put in place measures to rectify the same. The functions of this Committee include identifying the reasons for delay in detection, if any, and reporting to top management of the Bank and RBI on the same. The status of filing of complaint with law enforcement agencies and recovery position is also monitored by the Committee. The Committee also ensures that staff accountability is examined at all levels in all the cases of frauds and action, if required, is completed quickly without loss of time. The role of the Committee is also to review the efficacy of the remedial action taken to prevent recurrence of frauds, such as strengthening of internal controls. Composition There were six meetings of the Committee during the year – April 13, 2023, July 21, 2023, October 20, 2023, December 15, 2023, January 19, 2024 and February 20, 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended Radhakrishnan Nair, Chairman 6/6 S. Madhavan 6/6 Neelam Dhawan 6/6 Sandeep Bakhshi 6/6 Rakesh Jha 6/6 VIII. Information Technology Strategy Committee Terms of Reference The functions of the Committee are to approve strategy for Information Technology (IT) and policy documents, ensure that IT strategy is aligned with business strategy, review performance with reference to IT & IS key risk indicators including periodic review of such risk indicators, ensure proper balance of IT investments for sustaining the Bank's growth, oversee the aggregate funding of IT at Bank- level, ascertain if the management has resources to ensure the proper management of IT risks, review contribution of IT to business, oversee the activities of Digital Council, review technology from a future readiness perspective, overseeing key projects progress & critical IT systems performance including review of IT capacity requirements and adequacy and effectiveness of business continuity management and disaster recovery, review of special IT initiatives, review cyber risk, consider the RBI inspection report/ directives received from time to time by the Bank in the areas of information technology and cyber security and to review the compliance of various actionables BOARD’S REPORT 92 | Annual Report 2023-24 arising out of such reports/directives as may be deemed necessary from time to time and review deployment of skilled resources within Technology and Information Security function to ensure effective and efficient deliveries Composition There were five meetings of the Committee during the year - April 13, 2023, July 20, 2023, October 12, 2023, January 18, 2024 and March 28, 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended B. Sriram, Chairman 5/5 Neelam Dhawan 5/5 Anup Bagchi (upto April 30, 2023) 1/1 Sandeep Batra 5/5 Rakesh Jha (w.e.f. May 1, 2023) 4/4 IX. Risk Committee Terms of Reference The functions of the Committee are to review ICICI Bank’s risk management policies pertaining to credit, market, liquidity, operational, outsourcing, reputation risks, business continuity plan and disaster recovery plan and approve Broker Empanelment Policy and any amendments thereto. The functions of the Committee also include setting limits on any industry or country, review of the ERM framework, Risk Appetite for the Bank, stress testing framework, ICAAP and framework for capital allocation; review of the Basel framework, risk dashboard covering various risks, outsourcing activities, the activities of the Asset Liability Management Committee and the proceedings of the Group Risk Management Committee. The Committee also carries out Cyber Security risk assessment. The appointment, removal and terms of remuneration of the Chief Risk Officer is subject to review by the Committee. The Committee keeps the Board of Directors informed about the nature and content of its discussions, recommendations and actions to be taken. The Committee coordinates its activities with other committees, in instances where there is any overlap with activities of such committees, as per the framework laid down by the Board of Directors. Composition There were eight meetings of the Committee during the year April 21, 2023, June 9, 2023, June 23, 2023, July 20, 2023, October 20, 2023, January 19, 2024, February 9, 2024 and March 22, 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended S. Madhavan, Chairman 8/8 Girish Chandra Chaturvedi (upto June 30, 2024) 8/8 Pradeep Kumar Sinha (w.e.f. February 23, 2024) 1/1 Vibha Paul Rishi 8/8 Sandeep Batra 8/8 X. Stakeholders Relationship Committee Terms of Reference The functions of the Committee include approval and rejection of transmission of shares, bonds, debentures, issue of duplicate certificates, allotment of securities from time to time, redressal and resolution of grievances of security holders, delegation of authority for opening and operation of bank accounts for payment of interest/dividend. Composition There were four meetings of the Committee during the year - April 21, 2023, July 21, 2023, October 19, 2023 and January 19, 2024. The details of the composition of the Committee and attendance at its meetings held during the year are set out in the following table: Name of Member Number of meetings attended Hari L. Mundra, Chairman 4/4 Uday Chitale 4/4 Sandeep Batra 4/4 BOARD’S REPORT Annual Report 2023-24 | 93 Integrated Report Statutory Reports Financial Statements Prachiti Lalingkar, Company Secretary of the Bank acts as the Compliance Officer in accordance with the requirements of the SEBI Listing Regulations. 481 investor complaints were received in fiscal 2024. At March 31, 2024, three complaints remained unresolved which were subsequently disposed off within the prescribed timelines. XI. Review Committee for Identification of Wilful Defaulters/Non Co-operative Borrowers Terms of Reference The function of the Committee is to review the order of the Committee for identification of wilful defaulters/ non co-operative borrowers (a Committee comprising wholetime Directors and senior executives of the Bank to examine the facts and record the fact of the borrower being a wilful defaulter/non co-operative borrower) and confirm the same for the order to be considered final. Composition The Managing Director & CEO is the Chairman of this Committee and any two independent Directors comprise the remaining members. One Meeting of the Committee was held during the year. The Committee Meeting held on September 1, 2023 was attended by Sandeep Bakhshi, Uday Chitale and Radhakrishnan Nair. XII. Separate Meeting of Independent Directors During the year, the Independent Directors met on April 22, 2023 inter alia to review the matters statutorily prescribed under the Companies Act, 2013 and the SEBI Listing Regulations. XIII. Other Committees A meeting of the Committee comprising of all the Independent Directors of the Bank was held on June 29, 2023. The Committee recommended to the Board of Directors of the Bank, the draft scheme of arrangement for delisting of ICICI Securities under Regulation 37 of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021 and making ICICI Securities a wholly owned subsidiary of the Bank. In addition to the above, the Board has from time to time constituted various committees, namely, Committee of Executive Directors, Executive Investment Committee, Asset Liability Management Committee, Committee for Identification of Wilful Defaulters/Non Co-operative Borrowers, Committee of Senior Management (comprising certain wholetime Directors and Executives), Committee of Executives, Compliance Committee, Group Risk Management Committee, Process Approval Committee, Outsourcing Committee, Operational Risk Management Committee, Vigilance Committee, Product Governance Forum and other committees. These committees are responsible for specific areas like asset liability management, approval/renewal of credit proposals, review of group risk management framework, approval of products and processes and management of operational risk, etc., under authorisation/supervision of the Board and its committees. XIV. General Body Meetings Annual General Meetings The details of General Body Meetings held in the last three years are given below: General Body Meeting Day, Date Time Venue Twenty-Ninth Annual General Meeting Wednesday, August 30, 2023 2:00 p.m. Meeting held through Video Conferencing/ Other Audio Visual Means Twenty-Eighth Annual General Meeting Tuesday, August 30, 2022 3:00 p.m. Meeting held through Video Conferencing/ Other Audio Visual Means Twenty-Seventh Annual General Meeting Friday, August 20, 2021 3:00 p.m. Meeting held through Video Conferencing/ Other Audio Visual Means BOARD’S REPORT 94 | Annual Report 2023-24 The details of the Special Resolutions passed at the Annual General Meetings held in the year 2023 and 2022 are given below: General Body Meeting Day, Date Resolutions Twenty-Ninth Annual General Meeting Wednesday, August 30, 2023 • Re-appointment of Hari L. Mundra (DIN: 00287029) as an Independent Director of the Bank • Re-appointment of B. Sriram (DIN: 02993708) as an Independent Director of the Bank • Re-appointment of S. Madhavan (DIN: 06451889) as an Independent Director of the Bank Twenty-Eighth Annual General Meeting Tuesday, August 30, 2022 • Re-appointment of Neelam Dhawan (DIN: 00871445) as an Independent Director of the Bank • Re-appointment of Uday Chitale (DIN: 00043268) as an Independent Director of the Bank • Re-appointment of Radhakrishnan Nair (DIN: 07225354) as an Independent Director of the Bank • Approval and adoption of ‘ICICI Bank Employees Stock Unit Scheme - 2022’ • Approval of grant of Units to the eligible employees of select unlisted wholly owned subsidiaries under ‘ICICI Bank Employees Stock Unit Scheme - 2022’ No Special Resolution was passed at the Twenty-Seventh Annual General Meeting held on Friday, August 20, 2021. National Company Law Tribunal (NCLT) Convened Meeting In accordance with the order dated January 18, 2024 passed by the Hon’ble NCLT, Ahmedabad Bench, the Meeting of Equity Shareholders of the Bank was convened on March 27, 2024, through Video Conference/Other Audio Visual Means, to consider and approve, the Scheme of Arrangement amongst the Bank and ICICI Securities and their respective shareholders for delisting of equity shares of ICICI Securities by issuing equity shares of the Bank to the public shareholders of ICICI Securities in lieu of cancellation of their equity shares in ICICI Securities. The Bank had extended the remote e-voting facility for its equity shareholders, to enable them to cast their votes electronically. Further, the e-voting facility during the Meeting was also available for those equity shareholders, who were present in the Meeting and had not cast their vote through remote e-voting and were otherwise not barred from doing so. Vinita Nair of Vinod Kothari & Company, Practicing Company Secretaries, Scrutinizer submitted her report on March 27, 2024. Basis the consolidated Scrutinizer’s Reports, the resolution approving the said Scheme of Arrangement was passed by the Equity Shareholders: • with requisite statutory majority under Section 230 of the Companies Act, 2013; • with requisite statutory majority of Public Shareholders under Regulation 37 of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021; and • with requisite statutory majority of Public Shareholders under the Master Circular on (i) Scheme of Arrangement by Listed Entities and (ii) Relaxation under Sub-rule (7) of rule 19 of the Securities Contracts (Regulation) Rules, 1957 dated June 20, 2023. The Scrutinizer Reports and the Voting results of the said Meeting are available on the website of the stock exchanges and website of the Bank. Postal Ballot No resolution was passed through postal ballot during fiscal 2024. In accordance with the applicable provisions of the Companies Act, 2013 read with rules made thereunder and the General Circulars issued by BOARD’S REPORT Annual Report 2023-24 | 95 Integrated Report Statutory Reports Financial Statements the Ministry of Corporate Affairs, approval of the Members was sought vide Postal Ballot Notice dated April 5, 2024 by way of electronic voting (‘remote e-voting’) on the following Resolutions: 1. Special Resolution for appointment of Mr.  Pradeep Kumar Sinha (DIN: 00145126) as an Independent Director with effect from February 17, 2024; 2. Ordinary Resolution for compensation payable to Pradeep Kumar Sinha (DIN: 00145126) as Non-Executive Part-time Chairman with effect from July 1, 2024 or the date of approval from Reserve Bank of India, whichever is later; 3. Ordinary Resolution for revision in compensation in the form of fixed remuneration payable to the Non-Executive Directors (other than part-time Chairman and the Director nominated by the Government of India); 4. Ordinary Resolution for revision in fixed remuneration of Girish Chandra Chaturvedi (DIN: 00110996), Non-Executive (Part-time) Chairman; and 5. Ordinary Resolution for appointment of Ajay Kumar Gupta (DIN: 07580795) as a Director and Whole-time Director (designated as Executive Director) with effect from March 15, 2024 and payment of remuneration to him. Vinita Nair of Vinod Kothari & Company, Practicing Company Secretaries, Scrutinizer submitted her report on May 15, 2024. Basis the consolidated Scrutinizer’s report, all the above resolutions were passed with requisite majority on May 14, 2024 (being the last date of remote e-voting). The Scrutinizer Report and the Voting results of the said Meeting are available on the website of the stock exchanges and website of the Bank. None of the businesses proposed to be transacted at the ensuing AGM require passing of resolution through postal ballot. XV. Disclosures 1. There are no materially significant transactions with related parties i.e., directors, management, subsidiaries, or relatives conflicting with the Bank’s interests. The Bank has no promoter. 2. Details of non-compliance by the Bank, penalties or strictures imposed on the Bank by stock exchanges or SEBI or any statutory authority, on any matter relating to capital markets, during the last three years are detailed as under: (i) SEBI issued administrative warning letter dated March 30, 2024 in respect of the observations identified during the inspection of Depository Participant (DP) activities for the following observations: a. In one instance, bank account was not updated in back-office system. b. In one instance of Delivery Instruction Slip (DIS) issuance, DP has issued DIS booklet to client on April 17, 2023 but same was not entered in Depository Participant Module system. The Bank vide its letter dated April 6, 2024 to SEBI, has submitted action taken report on the observations made by SEBI. Further, as advised by SEBI, the aforementioned letter from SEBI along with inspection findings and the corrective steps taken by the Bank were placed before the Board of Directors in its meeting held on April 27, 2024. The Board noted the steps taken by the Bank and advised to ensure compliance with the instructions issued by SEBI. The same was informed to SEBI by the Bank vide letter dated May 30, 2024. (ii) BSE and NSE had levied a fine of ` 11,800 each for delay in submitting the notice of record date in one instance under Regulation 60(2) of the SEBI Listing Regulations. The Bank paid fines to both the stock exchanges and filed for waiver of the fine. BSE and NSE vide its communication dated March 31, 2023 and May 15, 2023 respectively, waived the fine. (iii) SEBI issued an administrative warning on March 2, 2023 for collection of registration fees in advance before registration of Common Application Form (CAF) and collection of balance fees in case of re‑categorization of FPI category and non-updation of operational manual with specific section to deal with specific BOARD’S REPORT 96 | Annual Report 2023-24 entities. The Bank has submitted its action taken report to SEBI. Further, the Board of Directors noted the steps taken by the Bank and advised to ensure timely compliance with the instruction issued by SEBI. The same was informed to SEBI. (iv) SEBI issued an administrative warning on October 14, 2022 for failure to transfer amounts pertaining to written off securities to the Investor Protection and Education Fund within prescribed timelines and delay in updation of Operational Manual after issuance of Regulations/Guidelines. The Bank placed the same alongwith corrective measures before the Board and also submitted the responses to SEBI. (v) SEBI issued an administrative warning on December 3, 2021 with regard to erroneous submission of monthly Assets Under Custody data to National Securities Depository Limited. The communication received from SEBI and additional corrective action taken by Bank was placed before the Board of Directors of the Bank. The Board took note of the controls implemented and advised to follow the same diligently and the same was informed to SEBI. 3. In terms of the Whistle Blower Policy of the Bank, no employee of the Bank has been denied access to the Audit Committee. 4. Being a banking company, the disclosures relating to deposits as required under Rule 8(5)(v) and (vi) of the Companies (Accounts) Rules, 2014, read with Sections 73 and 74 of the Companies Act, 2013, are not applicable to the Bank. 5. There is no application or proceeding pending against the Bank under the Insolvency and Bankruptcy Code, 2016 during the year under review. 6. There was no instance of one-time settlement with any other Bank or financial institution during the year under review. XVI. MEANS OF COMMUNICATION It is ICICI Bank’s belief that all stakeholders should have access to information regarding its position to enable them to accurately assess its future potential. ICICI Bank disseminates information on its operations and initiatives on a regular basis. ICICI Bank‘s website www.icicibank.com serves as a key awareness facility for all its stakeholders, allowing them to access information at their convenience. It provides comprehensive information on ICICI Bank’s strategy, financial performance, operational performance and the latest press releases. ICICI Bank’s investor relations personnel respond to specific queries and play a proactive role in disseminating information to both analysts and investors. In accordance with SEBI and Securities Exchange Commission (SEC) guidelines, all information which could have a material bearing on ICICI Bank’s share price is released through leading domestic and global wire agencies. The information is also disseminated to the NSE, BSE, New York Stock Exchange (NYSE), SEC, Singapore Stock Exchange, Japan Securities Dealers Association and SIX Swiss Exchange Ltd. from time to time. The financial and other information and the various compliances as required/prescribed under the SEBI Listing Regulations are filed electronically with NSE/BSE and are also available on their respective websites in addition to the Bank’s website. ICICI Bank’s quarterly financial results are published in Financial Express and Vadodara Samachar. The financial results, official news releases, earnings call transcripts, audio recording and presentations are also available on the Bank’s website. The Management’s Discussion & Analysis forms part of the Annual Report. General Shareholder Information Annual General Meeting Day, Date Time Thirtieth Annual General Meeting through Video Conferencing/Other Audio Visual Means Thursday, August 29, 2024 3:00 p.m. Financial Year : April 1, 2023 to March 31, 2024 Record Date : August 12, 2024 Dividend Payment Date : Will be paid/despatched on or after September 2, 2024 BOARD’S REPORT Annual Report 2023-24 | 97 Integrated Report Statutory Reports Financial Statements Listing of equity shares/ADSs/Bonds on Stock Exchanges Stock Exchange Code for ICICI Bank BSE Limited (Equity) Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai 400 001 532174 & 6321741 National Stock Exchange of India Limited (Equity) Exchange Plaza, Bandra-Kurla Complex, Mumbai 400 051 ICICIBANK New York Stock Exchange (ADSs)2 11, Wall Street, New York, NY 10005, United States of America IBN 1 FII segment of BSE 2 Each ADS of ICICI Bank represents two underlying equity shares The bonds issued in domestic market comprised privately placed bonds as well bonds issued via public issues which are listed on BSE/NSE. ICICI Bank has paid annual listing fees for the relevant periods to BSE and NSE where its equity shares/ bonds are listed and NYSE where its ADSs are listed. Listing of other securities The bonds issued overseas are issued either in public or private placement format. The listed bonds are traded on Singapore Exchange Securities Trading Limited, 2 Shenton Way, #02-02, SGX Centre 1, Singapore 068804 or India International Exchange (IFSC) Limited (India INX), 1st Floor, Unit No. 101, The Signature, Building No. 13B, Road 1C, Zone 1, GIFT SEZ, GIFT City, Gandhinagar, Gujarat 382 355 or SIX Swiss Exchange Ltd, Pfingstweidstrasse 110, P.O. Box 1758, CH-8021 Zurich, Switzerland. Market Price Information The reported high and low closing prices and volume of equity shares of ICICI Bank traded during fiscal 2024 on BSE and NSE are set out in the following table: Month BSE NSE Total Volume on BSE and NSE High (`) Low (`) Volume High (`) Low (`) Volume April-23 918.50 868.30 3,734,903 918.35 868.45 477,530,514 481,265,417 May-23 954.60 921.25 5,087,937 954.30 921.70 400,248,418 405,336,355 June-23 947.25 922.85 4,079,529 946.75 923.15 315,849,797 319,929,326 July-23 998.05 942.00 7,218,546 998.30 942.55 373,788,451 381,006,997 August-23 995.10 950.95 8,585,667 994.55 950.65 419,882,175 428,467,842 September-23 992.35 942.70 5,493,885 992.45 942.60 321,389,248 326,883,133 October-23 954.95 909.15 9,883,920 954.25 908.65 210,597,432 220,481,352 November-23 948.35 914.40 8,953,654 948.10 914.05 250,222,994 259,176,648 December-23 1,037.10 946.35 12,963,103 1,037.40 946.70 337,503,340 350,466,443 January-24 1,029.45 979.30 17,537,414 1,029.05 979.75 419,667,168 437,204,582 February-24 1,063.65 989.60 8,805,282 1,062.70 989.30 275,645,002 284,450,284 March-24 1,096.80 1,076.95 15,766,553 1,097.10 1,076.85 351,930,258 367,696,811 BOARD’S REPORT 98 | Annual Report 2023-24 The reported high and low closing prices and volume of ADSs of ICICI Bank traded during fiscal 2024 on the NYSE are given below: Month High (USD) Low (USD) Number of ADS traded April-23 22.75 21.37 86,158,700 May-23 23.08 22.45 77,704,900 June-23 23.11 22.60 82,153,525 July-23 24.66 22.96 73,859,355 August-23 24.50 22.82 91,903,102 September-23 24.03 22.74 78,290,525 October-23 23.06 22.04 91,908,554 November-23 22.84 22.12 115,404,498 December-23 24.69 22.97 112,969,000 January-24 24.47 23.16 170,193,064 February-24 25.96 23.58 103,023,672 March-24 26.48 25.82 108,870,218 The performance of ICICI Bank equity shares relative to the S&P BSE Sensitive Index (Sensex), S&P BSE Bank Index (Bankex) and NYSE Financial Index during the period April 1, 2023 to March 31, 2024 is given in the following chart: Share Transfer System, Dematerilisation of Shares and Liquidity As per the SEBI mandate, securities of listed companies can be transferred/traded only in dematerialised form. In view of this and to eliminate all risks associated with physical shares and for ease of portfolio management, Members holding shares in physical form are requested to consider converting their holdings to dematerialised form. The Bank’s equity shares are actively traded on the stock exchanges. S&P BSE Sensex S&P BSE Bankex NYSE Financial Index ICICI Bank Apr/23 80.00 95.00 110.00 125.00 May/23 Jun/23 Jul/23 Aug/23 Sep/23 Oct/23 Nov/23 Dec/23 Jan/24 Feb/24 Mar/24 BOARD’S REPORT Annual Report 2023-24 | 99 Integrated Report Statutory Reports Financial Statements As required under Regulation 40(9) of the SEBI Listing Regulations, a certificate is obtained from a practicing Company Secretary and filed with BSE and NSE, where the equity shares of ICICI Bank are listed. In terms of Regulation 76 of the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018 and SEBI Circular No. D&CC/FITTC/CIR-16/2002 dated December 31, 2002, as amended vide Circular No. CIR/MRD/DP/30/2010 dated September 6, 2010 an audit is conducted on a quarterly basis, for the purpose of, inter alia, reconciliation of the total admitted equity share capital with the depositories and in the physical form with the total issued/paid up equity share capital of ICICI Bank. Audit Reports issued in this regard are placed before the Stakeholders Relationship Committee and filed with BSE and NSE, where the equity shares of ICICI Bank are listed. Registrar and Transfer Agents KFin Technologies Limited is the Registrar & Transfer Agent (R & T Agent) for equity shares of ICICI Bank. Investor services related queries/requests/grievances for equity shares may be directed to C Shobha Anand at the following address: KFin Technologies Limited Unit: ICICI Bank Limited Selenium Building, Tower-B Plot No. 31 & 32, Financial District Nanakramguda, Serlingampally Hyderabad 500 032, Rangareddy Telangana, India Tel. No.: +91-040-6716 2222 Fax No.: +91-040-2342 0814 Toll free No.: 18003094001 E-mail: einward.ris@kfintech.com Website: https://ris.kfintech.com Investor Support Centre: https://ris.kfintech.com/ clientservices/isc Details of other Service Centers of KFin Technologies Limited, R & T Agent for equity shareholders can be viewed at https://www.icicibank.com/about-us/ investor-contact. 3i Infotech Limited is the R & T Agent for the bonds/ debentures issued by the Bank. Investor services related queries/requests/grievances for bonds/ debentures may be directed to Vijay Singh Chauhan at the following address: 3i Infotech Limited International Infotech Park, Tower # 5, 3rd Floor, Vashi Railway Station Complex, Vashi Navi Mumbai 400 703, Maharashtra, India Tel. No.: +91-22-7123 8034/35 E-mail: ICICIbonds@3i-infotech.com Website: https://www.3i-infotech.com/investors/ Queries relating to the operational and financial performance of ICICI Bank may be addressed to: Anindya Banerjee/Abhinek Bhargava ICICI Bank Limited ICICI Bank Towers Bandra-Kurla Complex Mumbai 400 051 Tel. No.: +91-22-4008 6173 E-mail: ir@icicibank.com Debenture Trustees Pursuant to Regulation 53 of the SEBI Listing Regulations, the names and contact details of the debenture trustees for the public issue bonds and privately placed bonds of the Bank are given below: Axis Trustee Services Limited IDBI Trusteeship Services Limited The Ruby, 2nd Floor, SW 29 Universal Insurance Building Senapati Bapat Marg Ground Floor, Sir P.M. Road Dadar West, Mumbai 400 028 Fort, Mumbai 400 001 Tel. No.: +91-22-6230 0451 Tel. No.: +91-22-4080 7000 debenturetrustee@axistrustee.com itsl@idbitrustee.com The details are available on the website of the Bank at https://www.icicibank.com/Personal-Banking/investments/ icici-bank-bonds/index.page. BOARD’S REPORT 100 | Annual Report 2023-24 Bank’s Customer Service The Bank enables customers to avail of services through multiple channels. • iMobile Pay: Seek resolution using the iPAL chat bot. • Website: Register a request on the Bank’s website. For details, https://www.icicibank.com/personal-banking/ insta-banking/internet-banking/list-of-service-requests • Customer care: Connect with us over the phone. To know more, visit https://www.icicibank.com/customer-care?ITM=nli_cms_CONTACT_US_customer_care_menu_navigation • Email: Write to us at customer.care@icicibank.com • Branch: Visit our branch for resolution. Alternative, drop queries/feedback in the drop box at branches. Information on Shareholding Shareholding pattern of ICICI Bank at March 31, 2024 Shareholder Category No. of Shares % holding Deutsche Bank Trust Company Americas (Depositary for ADS holders) 1,374,664,201 19.58 FIIs/FPIs 2,528,698,726 36.01 Insurance Companies 670,665,487 9.55 Bodies Corporate (includes Government Companies, Clearing Members, Banks and Financial Institutions) 84,843,885 1.21 Mutual Funds 1,678,991,546 23.91 Individuals (includes HUF, Trusts, NRI) 456,447,048 6.50 NBFCs Registered with RBI 13,615,190 0.19 Provident Funds/Pension Funds 156,145,413 2.22 Alternate Investment Fund 41,343,838 0.59 Investor Education and Protection Fund 8,875,168 0.13 Others (includes Foreign Banks, Foreign Companies, Foreign Nationals etc.) 8,045,141 0.11 Total 7,022,335,643 100.00 Shareholders of ICICI Bank with more than one percent holding (PAN based) at March 31, 2024 Name of the Shareholder No. of Shares % holding Deutsche Bank Trust Company Americas* 1,374,664,201 19.58 SBI Mutual Fund 403,067,084 5.74 Life Insurance Corporation of India 395,845,579 5.64 ICICI Prudential Mutual Fund 253,779,280 3.61 HDFC Mutual Fund 194,958,823 2.78 Government of Singapore 178,441,181 2.54 NPS Trust 156,145,413 2.22 UTI Mutual Fund 134,253,686 1.91 Nippon Life India Mutual Fund 104,008,735 1.48 SBI Life Insurance Company Limited 89,523,653 1.27 Aditya Birla Sun Life Mutual Fund 80,680,613 1.15 Government Pension Fund Global 75,410,144 1.07 Kotak Mutual Fund 73,435,503 1.05 * Deutsche Bank Trust Company Americas holds equity shares of ICICI Bank as depositary for ADS holders. BOARD’S REPORT Annual Report 2023-24 | 101 Integrated Report Statutory Reports Financial Statements Distribution of shareholding of ICICI Bank at March 31, 2024 Range - Shares No. of Folios % No. of Shares % 1 - 5,000 1,850,055 98.75 244,000,021 3.47 5,001 - 10,000 11,753 0.63 40,652,980 0.58 10,001 - 20,000 5,163 0.28 35,919,307 0.51 20,001 - 30,000 1,603 0.08 19,643,006 0.28 30,001 - 40,000 758 0.04 13,271,501 0.19 40,001 - 50,000 446 0.02 10,070,142 0.14 50,001 - 100,000 995 0.05 35,576,217 0.51 100,001 & Above 2,739 0.15 6,623,202,469 94.32 Total 1,873,512 100.00 7,022,335,643 100.00 Details of shares held in Demat and Physical form at March 31, 2024 Mode of holding No. of Shares % Demat 7,010,837,674 99.84 Physical 11,497,969 0.16 Total 7,022,335,643 100.00 Details of shares/convertible instruments held by Non-executive Directors As on March 31, 2024, S. Madhavan and Vibha Paul Rishi (as joint holder) held 4,000 and 330 equity shares of ` 2.00 each respectively. Disclosure with respect to shares lying in suspense account The Bank has been transferring the shares lying unclaimed to the eligible shareholders as and when the request for the same has been received after proper verification. During the fiscal 2024, the Bank had processed requests received from three shareholders holding 236 shares and accordingly the said shares were transferred from the suspense account. As on March 31, 2024, 93,202 shares held by 464 shareholders remained unclaimed in the suspense account. The voting rights on the shares lying in suspense account are frozen till the rightful owner of such shares claims the shares. Transfer of unclaimed dividend and shares to Investor Education & Protection Fund (IEPF) Pursuant to the provisions of Sections 124 and 125 of the Companies Act, 2013, during fiscal 2024, dividend amount of ` 73.32 million remaining unclaimed for a period of seven years from the date of its transfer to the Unpaid Dividend Accounts of the Company has been transferred to the IEPF. Pursuant to Section 124(6) of the Companies Act, 2013 read with the Investor Education & Protection Fund Authority (Accounting, Audit, Transfer & Refund) Rules, 2016, during fiscal 2024, 709,546 equity shares in respect of which the dividend has not been claimed for seven consecutive years have been transferred to the designated demat account of the IEPF Authority. The unclaimed dividend and the equity shares transferred to IEPF can be claimed by making an application in the prescribed form to IEPF. Members who have not yet encashed their dividend warrant(s) for the financial year ended March 31, 2018 and/or subsequent years are requested to submit their claims to KFin Technologies Limited without any delay. The details of Nodal Officer and Deputy NodaI Officers appointed under the provisions of IEPF are available on the website of the Bank at https://www.icicibank. com/about-us/invest-relations/unpaid-unclaimed- dividend. BOARD’S REPORT 102 | Annual Report 2023-24 Outstanding GDRs/ADSs/Warrants or any Convertible instruments, conversion date and likely impact on equity ICICI Bank has 687.33 million ADS (equivalent to 1,374.66 million equity shares) outstanding, which constituted 19.58% of ICICI Bank’s total equity capital at March 31, 2024. There are no other convertible instruments outstanding as on March 31, 2024. Commodity price risk or foreign exchange risk and hedging activities The foreign exchange risk position including bullion is managed within the net overnight open position limit approved by the Board of Directors. The foreign currency assets of the Bank are primarily floating rate linked assets. Wholesale liability raising for foreign currencies takes place in USD or other currencies through bond issuances, bilateral loans and syndicated/club loans as well as refinance from Export Credit Agencies which may be at a fixed rate or floating rate linked. In case of fixed rate long-term wholesale fund raising in USD, the interest rate risk is generally hedged through interest rate swaps wherein the Bank effectively moves the interest payments to a floating rate index in order to match the asset profile. In case of fund raising in non-USD currencies, the foreign exchange risk is hedged through foreign exchange swaps or currency interest rate swaps. The extant RBI guidelines do not allow AD Category I Banks to take any market positions in commodity related activities. However, the extant guidelines allows Bank to import gold and silver in line with the RBI license and selling of imported gold/silver on outright basis to domestic clients or providing gold metal loan to jewellery manufacturers. ICICI Bank provides pricing and hedging of Gold Metal Loan to jewellery customers and such exposures are covered on a back-to-back basis with gold suppliers. In view of the above, the disclosure pursuant to the SEBI Circular No. SEBI/HO/CFD/CMD1/ CIR/P/2018/0000000141 dated November 15, 2018 is not required to be given. Plant Locations – Not applicable Address for Correspondence Prachiti Lalingkar Company Secretary ICICI Bank Limited ICICI Bank Towers Bandra-Kurla Complex Mumbai 400 051 Tel. No.: +91-22-4008 8900 E-mail: companysecretary@icicibank.com The Bank is in compliance with requirements specified in Regulations 17 to 27 and clauses (b) to (i) of sub- regulation (2) of Regulation 46 of the SEBI Listing Regulations. The Bank has also complied with the discretionary requirements such as maintaining a separate office for the Chairman at the Bank’s expense, ensuring financial statements with unmodified audit opinion, separation of posts of Chairman and Chief Executive Officer and reporting of internal auditor directly to the Audit Committee. Analysis of Customer Complaints The details required as per the RBI Circular No. CEPD.CO.PRD.Cir.No.01/13.01.013/2020-21 dated January 27, 2021 are disclosed in note no. 55 of Schedule 18 of the financial statements. COMPLIANCE CERTIFICATE OF THE AUDITORS ICICI Bank has annexed to this Report, a certificate obtained from the Secretarial Auditor regarding compliance of conditions of Corporate Governance as stipulated in the SEBI Listing Regulations. SHARE BASED EMPLOYEE BENEFITS SCHEME(S) (a) ICICI Bank Employees Stock Option Scheme - 2000 ICICI Bank has an Employees Stock Option Scheme - 2000 (Scheme 2000) which was instituted in fiscal 2000 to enable the employees and Wholetime Directors of ICICI Bank and its subsidiaries to participate in future growth and financial success of the Bank. The Scheme 2000 aims at achieving the twin objectives of aligning employee interest to that BOARD’S REPORT Annual Report 2023-24 | 103 Integrated Report Statutory Reports Financial Statements of the shareholders and retention. Through employee stock option grants, the Bank seeks to foster a culture of long-term sustainable value creation. The Scheme 2000 is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (the SEBI SBEB & SE Regulations). The options are granted by BGRNC and noted/approved by the Board as the case maybe. The Scheme 2000 was initially approved by the Members at their meeting held on February 21, 2000 and amended from time to time. The Bank has upto March 31, 2024 granted (net of lapsed) 625.52 million stock options from time to time aggregating to 8.91% of the issued equity capital of the Bank at March 31, 2024. As per the Scheme 2000, as amended from time to time, the maximum number of options granted to any employee/Director in a year is limited to 0.05% of ICICI Bank’s issued equity shares at the time of the grant, and the aggregate of all such options is limited to 10% of ICICI Bank’s issued equity shares on the date of the grant (equivalent to 702.23 million shares of face value ` 2.00 each at March 31, 2024). Particulars of options granted by ICICI Bank as on March 31, 2024 are given below: Number of options outstanding1 at the beginning of the year 225,025,803 Number of options granted during the year 14,635,600 Number of options forfeited/ lapsed during the year 1,410,025 Number of options vested during the year 25,931,860 Number of options exercised during the year 39,519,912 Number of shares arising as a result of exercise of options 39,519,912 Money realised by exercise of options during the year (`) 11,708,674,581 Number of options outstanding1 at the end of the year 198,731,466 Number of options exercisable at the end of the year 159,296,026 1 options granted less exercised less lapsed (b) ICICI Bank Employees Stock Unit Scheme - 2022 The Board of Directors of ICICI Bank at its meeting held on June 28, 2022, approved the adoption of Employees Stock Unit Scheme - 2022 (Scheme 2022). The Scheme 2022 was approved by the Members at the Annual General Meeting held on August 30, 2022. The key objectives of the Scheme 2022 are to deepen the co-ownership amongst the (i) mid level and front- line managers, and (ii) employees of Bank’s select unlisted wholly owned subsidiaries with the following key considerations: i. to enable employees’ participation in the business as an active stakeholder to usher in an ‘Owner-Manager’ culture and to act as a retention mechanism; ii. to enhance motivation of employees; and iii. to enable employees to participate in the long term growth and financial success of the Bank. The Scheme 2022 is in compliance with the SEBI SBEB & SE Regulations. Maximum of 100,000,000 units, shall be granted in one or more tranches over a period of 7 years from the date of approval of the Scheme 2022 by the shareholders, which shall entitle the unit holder one fully paid-up equity share of face value of ` 2.00 of the Bank (as adjusted for any changes in capital structure of the Bank) against each unit exercised and accordingly, up to 100,000,000 equity shares of face value of ` 2.00 each shall be allotted to all eligible employees taken together under the Scheme 2022. Units granted under the Scheme 2022 shall vest not later than the maximum vesting period of 4 years. Exercise price shall be the face value of equity shares of the Bank i.e. ` 2.00 for each unit (as adjusted for any changes in capital structure of the Bank). Units granted under the Scheme 2022 vest in a graded manner over a three‑year period with 30%, 30% and 40% of the grant vesting in each year, commencing from the end of 13 months from the date of grant. Exercise period will not exceed five years from date of vesting of units or such shorter period as may be determined by the BGRNC for each grant. BOARD’S REPORT 104 | Annual Report 2023-24 Besides continuity of employment, vesting shall also be dependent on achievement of certain corporate performance parameter(s) such as: • Risk Calibrated Core Operating profit; • Provision/asset quality; • Other parameters, if any, as the Committee may determine Particulars of units granted by ICICI Bank as on March 31, 2024 are given below: Number of units outstanding1 at the beginning of the year Nil Number of units granted during the year 4,419,670 Number of units forfeited/ lapsed during the year 228,860 Number of units vested during the year 2,700 Number of units exercised during the year Nil Number of shares arising as a result of exercise of units Nil Money realised by exercise of units during the year (`) Nil Number of units outstanding1 at the end of the year 4,190,810 Number of units exercisable at the end of the year 2,700 1 units granted less lapsed Till March 31, 2021, the Bank recognised cost of stock options granted under Scheme 2000, using intrinsic value method. Pursuant to RBI clarification dated August 30, 2021, the cost of stock options/units granted after March 31, 2021 is recognised based on fair value method. The cost of stock options granted up to March 31, 2021 continues to be recognised on intrinsic value method. The Bank uses Black-Scholes model to fair value the options/units on the grant date and the inputs used in the valuation model include assumptions such as the expected life of the share option/units, volatility, risk free rate and dividend yield. The diluted earnings per share (EPS) pursuant to issue of shares on exercise of options calculated in accordance with Accounting Standard 20 for the year ended March 31, 2024 was ` 57.33 compared to basic EPS of ` 58.38. The following table sets forth, for the periods indicated, the key assumptions used to estimate the fair value of options granted. Particulars Year ended March 31, 2023 Year ended March 31, 2024 Risk-free interest rate 5.99% to 7.37% 6.88% to 7.32% Expected life 3.23 to 5.23 years 3.23 to 5.23 years Expected volatility 34.79% to 38.98% 24.78% to 37.41% Expected dividend yield 0.27% to 0.72% 0.56% to 0.85% The following table sets forth, for the periods indicated, the key assumptions used to estimate the fair value of units granted. Particulars Year ended March 31, 2024 Risk-free interest rate 6.82% to 6.94% Expected term 1.58 to 3.58 years Expected volatility 23.63% to 36.56% Expected dividend yield 0.56% The weighted average fair value, based on Black- Scholes model, of options granted during the year ended March 31, 2024 was ` 340.59 (year ended March 31, 2023: ` 291.15) and of units granted during the year ended March 31, 2024 was ` 879.43. The weighted average exercise price of options granted during the year ended March 31, 2024 was ` 894.95 (year ended March 31, 2023: ` 747.92). Risk free interest rates over the expected term of the option/units are based on the government securities yield in effect at the time of the grant. The expected term of an option/units is estimated based on the vesting term as well as expected exercise behavior of the employees who receive the option/units. Expected exercise behavior is estimated based on the historical stock option exercise pattern of the Bank. Expected volatility during the estimated expected term of the option/units is based on historical volatility determined based on observed market prices of the Bank's publicly traded equity shares. Expected dividends during the estimated expected term of the option/units are based on recent dividend activity. BOARD’S REPORT Annual Report 2023-24 | 105 Integrated Report Statutory Reports Financial Statements The detailed disclosures as stipulated under Regulation 14 of the SEBI SBEB & SE Regulations will be hosted on the website of the Bank at https://www. icicibank.com/about-us/other-policies. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The Bank has undertaken various initiatives for energy conservation at its premises. A detailed write up is given in the Environmental, Social and Governance Report of fiscal 2024 which will be available on the website of the Bank at https://www.icicibank.com/about-us/annual and in the Environment and Sustainability chapter in the Integrated Report section of the Annual Report 2023-24. The Bank has used information technology extensively in its operations; for details refer to the chapter Our Business Strategy in the Integrated Report section of the Annual Report 2023‑24. For fiscal 2024, net foreign exchange gain arising on all exchange/derivative transactions of the Bank was ` 29.99 billion and the foreign exchange outgo towards the operating and capital expenditure was ` 3.44 billion. SECRETARIAL STANDARDS Your Bank is in compliance with the Secretarial Standard on Meetings of the Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2) for fiscal 2024. DIRECTORS’ RESPONSIBILITY STATEMENT The Directors confirm: 1. that in the preparation of the annual accounts, the applicable accounting standards had been followed, along with proper explanation relating to material departures; 2. that they have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Bank at the end of the financial year and of the profit of the Bank for that period; 3. that they have taken proper and sufficient care for the maintenance of adequate accounting records, in accordance with the provisions of the Banking Regulation Act, 1949 and the Companies Act, 2013 for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities; 4. that they have prepared the annual accounts on a going concern basis; 5. that they have laid down internal financial controls to be followed by the Bank and that such internal financial controls are adequate and were operating effectively; and 6. that they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. ACKNOWLEDGEMENTS ICICI Bank is grateful to the Government of India, Reserve Bank of India, Securities and Exchange Board of India, Insurance Regulatory and Development Authority of India and overseas regulators for their continued co-operation, support and guidance. ICICI Bank wishes to thank its investors, the domestic and international banking community, rating agencies, depositories and stock exchanges for their support. ICICI Bank would like to take this opportunity to express sincere thanks to its valued clients and customers for their continued patronage. The Directors express their deep sense of appreciation to all the employees whose outstanding professionalism, commitment and initiative have made the organisation’s growth and success possible and continues to drive its progress. Finally, the Directors wish to express their gratitude to the Members for their trust and support. For and on behalf of the Board Girish Chandra Chaturvedi Chairman June 29, 2024  DIN: 00110996 Compliance with the Group Code of Business Conduct and Ethics I confirm that all Directors and members of the senior management have affirmed compliance with Group Code of Business Conduct and Ethics for the year ended March 31, 2024. Sandeep Bakhshi Managing Director & CEO April 27, 2024  DIN: 00109206 BOARD’S REPORT 106 | Annual Report 2023-24 ANNEXURE A FORM NO. MR-3 SECRETARIAL AUDIT REPORT FOR THE FINANCIAL YEAR ENDED MARCH 31, 2024 [Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014] To, The Members, ICICI Bank Limited We have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by ICICI Bank Limited (CIN: L65190GJ1994PLC021012) (hereinafter called “the Bank”). The Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon. Based on our verification of the Bank's statutory registers, books, papers, minute books, forms and returns filed and other records maintained by the Bank and the information provided by the Bank, its officers, agents and authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion, the Bank has, during the audit period covering the financial period ended on March 31, 2024, complied with the statutory provisions listed hereunder and also that the Bank has followed proper Board processes and has required compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter: We have examined the books, papers, minutes books, forms and returns filed and other records maintained by the Bank for the financial period ended on March 31, 2024 in accordance with the provisions of: (i) The Companies Act, 2013 (the Act) and the Rules made thereunder; (ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the Rules made thereunder; (iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder; (iv) Foreign Exchange Management Act, 1999 and the Rules and Regulations made thereunder for compliance to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings; (v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’), as amended from time to time: a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011; b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015; c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018; d) The Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021; e) The Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021; f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client - Not applicable to the Bank during the financial year under review; g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021 - Not applicable to the Bank for the purpose of its equity shares during the financial year under review; h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018 - Not applicable to the Bank during the financial year under review; i) The Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018; BOARD’S REPORT Annual Report 2023-24 | 107 Integrated Report Statutory Reports Financial Statements j) The Securities and Exchange Board of India (Debenture Trustee) Regulations, 1993; k) The Securities and Exchange Board of India (Custodian) Regulations, 1996; l) The Securities and Exchange Board of India (Bankers to an issue) Regulations, 1994; m) The Securities and Exchange Board of India (Stock Brokers) Regulations, 1992; n) The Securities and Exchange Board of India (Merchant Bankers) Regulations, 1992; o) The Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019 (vi) Other specific business/industry related laws applicable to the Bank – a) The Bank has complied with the provisions of the Banking Regulation Act, 1949, Master Circulars, Notifications and Guidelines and other directions pertaining to commercial banking issued by Reserve Bank of India (RBI) from time to time. b) The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 c) The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 d) The Shops and Establishments Act, 1953 Further, the Bank has complied with other applicable general business laws, rules, regulations and guidelines. We have also examined compliance with the applicable clauses of the following: i. Secretarial Standards with regard to Meeting of Board of Directors (SS-1) and General Meetings (SS-2) issued by The Institute of Company Secretaries of India; and ii. The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR Regulations). During the period under review, the Bank has complied with the provisions of the Act, Rules, Regulations, Guidelines and Standards mentioned above. Further, there were certain regulatory/statutory penalties imposed/warnings issued to the Bank. The Bank has paid the requisite penalty, wherever applicable and taken necessary corrective actions. We further report that: (a) The Board of Directors of the Bank is duly constituted with proper balance of Executive Directors, Non- Executive Directors and Independent Directors. (b) The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act. (c) Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent in advance as prescribed under the applicable Secretarial Standards, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. (d) In respect of meetings held at short notice or meetings for which the agenda notes (other than those relating to Unpublished Price Sensitive Information (UPSI)) were sent at a notice of less than 7 days, the unanimous consent of the Board/Committee was taken for discussion of the said agenda items and the same has been recorded in the minutes. (e) The decision at the meetings of the Board/committees were taken with requisite majority. The minutes of the Board/committees Meetings record that none of the members of the Board /committees have dissented to any proposal. We further report that, there are adequate systems and processes in the Bank commensurate with the size and operations of the Bank to monitor and ensure compliance with applicable laws, rules, regulations and guidelines. As informed, the Bank has responded appropriately to communication received from various statutory/regulatory authorities including initiating actions for corrective measures, wherever found necessary. We further report that during the audit period the following events / actions have taken place, having a major bearing on the Bank’s affairs in pursuance of the above referred laws, rules, regulations, guidelines and standards: 1. During the financial year, the Bank has allotted 3,95,19,912 Equity Shares of ` 2/- each under the Employee Stock Option Scheme. 2. Bank has allotted 4,00,000 Senior Unsecured Redeemable Long-term Bonds in the nature of Non- convertible Debentures aggregating to `  4,000.0 Crore on private placement basis on October 3, 2023. BOARD’S REPORT 108 | Annual Report 2023-24 3. Pursuant to the Order dated January 18, 2024 passed by the Hon’ble National Company Law Tribunal, Ahmedabad Bench, the Equity Shareholders of the Bank at the meeting held on March 27, 2024 have approved the Scheme of Arrangement amongst the Bank and ICICI Securities Limited (‘ICICI Securities’ Place : Mumbai ALWYN JAY & Co. Date : June 20, 2024 Company Secretaries Office Address : [Alwyn D’Souza, FCS.5559] Annex-103, Dimple Arcade, [Partner] Asha Nagar, Kandivali (East), [Certificate of Practice No.5137] Mumbai 400101. [UDIN : F005559F000596820] Note: This report is to be read with our letter of even date which is annexed as Annexure A and forms an integral part of this report. or ‘the Company’) and their respective shareholders (‘Scheme’) for delisting of equity shares of ICICI Securities by issuing equity shares of the Bank to the public shareholders of ICICI Securities in lieu of cancellation of their equity shares in the Company under Section 230 of the Companies Act,2013. BOARD’S REPORT Annual Report 2023-24 | 109 Integrated Report Statutory Reports Financial Statements ANNEXURE A To The Members, ICICI Bank Limited Secretarial Audit Report of even date is to be read along with this letter. 1. The compliance of provisions of all laws, rules, regulations, standards, Circulars, Guidelines and Standards etc. applicable to ICICI Bank Limited (hereinafter called ‘the Bank’) is the responsibility of the management of the Bank. Our examination was limited to the verification of records and procedures on test check basis for the purpose of issue of the Secretarial Audit Report. 2. Maintenance of secretarial and other records of applicable laws is the responsibility of the management of the Bank. Our responsibility is to issue Secretarial Audit Report, based on the audit of the relevant records maintained and furnished to us by the Bank, along with explanations where so required. 3. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the secretarial and other legal records, legal compliance mechanism and corporate conduct. Further, part of the verification was done on the basis of electronic data provided to us by the Bank and on test check basis to ensure that correct facts as reflected in secretarial and other records produced to us. We believe that the processes and practices we followed, provides a reasonable basis for our opinion for the purpose of issue of the Secretarial Audit Report. 4. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the Bank. 5. Wherever required, we have obtained the management representation about list of applicable laws, compliance of laws, rules and regulations and major events during the audit period. 6. The Secretarial Audit Report is neither an assurance as to the future viability of the Bank nor of the efficacy or effectiveness with which the management has conducted the affairs of the Bank. Place : Mumbai ALWYN JAY & Co. Date : June 20, 2024 Company Secretaries Office Address : [Alwyn D’Souza, FCS.5559] Annex-103, Dimple Arcade, [Partner] Asha Nagar, Kandivali (East), [Certificate of Practice No.5137] Mumbai 400101. [UDIN : F005559F000596820] BOARD’S REPORT 110 | Annual Report 2023-24 ANNEXURE B FORM NO. AOC-2 [Pursuant to clause (h) of sub-section (3) of Section 134 of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014] Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 including certain arm’s length transactions under third proviso thereto 1. Details of contracts or arrangements or transactions not at arm’s length basis Nil 2. Details of material contracts or arrangement or transactions at arm’s length basis Sr. No. Name of the related party Nature of relationship Nature of contracts/ arrangements/ transactions Duration of contracts/ arrangements/ transactions Salient terms of contracts/ arrangements/ transactions ` in million Date of approval by the Board, if any Amount paid as advances, if any 1 ICICI Securities Primary Dealership Limited Wholly owned subsidiary Short term lending by the Bank 1 day - 4 days Interest at prevailing market rates 1,021,540.0 - - For and on behalf of the Board Girish Chandra Chaturvedi Chairman June 29, 2024 DIN: 00110996 BOARD’S REPORT Annual Report 2023-24 | 111 Integrated Report Statutory Reports Financial Statements ANNEXURE C CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS [Pursuant to Regulation 34(3) and Para C (10)(i) of Schedule V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015] To, The Members of ICICI Bank Limited ICICI Bank Tower, Near Chakli Circle, Old Padra Road, Vadodara - 390 007 We have examined the relevant registers, records, forms, returns and disclosures received from the Directors of ICICI Bank Limited having CIN L65190GJ1994PLC021012 and having registered office at ICICI Bank Tower, Near Chakli Circle, Old Padra Road, Vadodara - 390007 (hereinafter referred to as ‘the Company’), produced before us by the Company for the purpose of issuing this Certificate, in accordance with Regulation 34(3) read with clause 10(i) of Para C of Schedule V to the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. In our opinion and to the best of our information and according to the verifications (including Directors Identification Number (DIN) status at the portal www.mca.gov.in) as considered necessary and explanations furnished to us by the Company & its officers, we hereby certify that none of the Directors on the Board of the Company as stated below for the Financial Year ended March 31, 2024 have been debarred or disqualified from being appointed or continuing as Directors of companies by the Securities and Exchange Board of India or the Ministry of Corporate Affairs or any such other statutory authority. Sl. No Name of the Director as on March 31, 2024 DIN Category of Directorship Date of Appointment 1. Mr. Girish Chandra Chaturvedi 00110996 Non-Executive - Independent Director July 01, 2018 2. Mr. Hari L. Mundra 00287029 Non-Executive - Independent Director October 26, 2018 3. Mr. S. Madhavan 06451889 Non-Executive - Independent Director April 14, 2019 4. Ms. Neelam Dhawan 00871445 Non-Executive - Independent Director January 12, 2018 5. Mr. Pradeep Kumar Sinha 00145126 Additional Director (Non-Executive Independent) February 17, 2024 6. Mr. Radhakrishnan Nair 07225354 Non-Executive - Independent Director May 02, 2018 7. Mr. B. Sriram 02993708 Non-Executive - Independent Director January 14, 2019 8. Mr. Uday Chitale 00043268 Non-Executive - Independent Director January 17, 2018 9. Ms. Vibha Paul Rishi 05180796 Non-Executive - Independent Director January 23, 2022 10. Mr. Sandeep Bakhshi 00109206 Managing Director & Chief Executive Officer October 15, 2018 11. Mr. Sandeep Batra 03620913 Wholetime Director December 23, 2020 12. Mr. Rakesh Jha 00042075 Wholetime Director September 02, 2022 13. Mr. Ajay Kumar Gupta 07580795 Additional Director (Executive - Whole-time) March 15, 2024 BOARD’S REPORT 112 | Annual Report 2023-24 Ensuring the eligibility for the appointment / continuity of every Director on the Board is the responsibility of the management of the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company. For M/s Vinod Kothari & Company Practicing Company Secretaries Unique Code: P1996WB042300 Vinita Nair Senior Partner Membership No.: F10559 C P No.: 11902 Place: Mumbai Peer Review Certificate No.: 4123/2023 Date: April 26, 2024 UDIN: F010559F000254858 BOARD’S REPORT Annual Report 2023-24 | 113 Integrated Report Statutory Reports Financial Statements ANNEXURE D ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES 1. Brief outline on CSR Policy of the Company Corporate Social Responsibility (CSR) has been a long-standing commitment at ICICI Bank and forms an integral part of our activities. The Bank’s contribution to social sector development includes several pioneering interventions, and is implemented through the involvement of stakeholders within the Bank, the Group and the broader community. The Bank established the ICICI Foundation for Inclusive Growth (ICICI Foundation) in 2008 with a view to significantly expand the ICICI Group’s activities in the area of CSR. Over the last few years, ICICI Foundation has developed significant projects in specific areas, and has built capabilities for direct project implementation as opposed to extending financial support to other organisations. ICICI Bank’s objective is to proactively support meaningful socio-economic development in India and enable a large number of people to participate in and benefit from India’s economic progress. This is based on the belief that growth and development are effective only when they result in wider access to opportunities and benefit a broader section of the society. ICICI Bank’s approach is to identify critical areas of development that require investments and intervention, and which can help to realize India’s potential for growth and prosperity. The CSR Policy of the Bank sets the framework guiding the Bank’s CSR activities. It outlines the governance structure, operating framework, monitoring mechanism, guiding principles for selecting CSR projects and CSR activities that could be undertaken. The Bank’s CSR activities are largely focused in the areas of healthcare, skill development and sustainable livelihood, rural development, social and environmental projects, creating social awareness and activities like disaster relief or other activities under Schedule VII of the Companies Act, 2013 (“the Act”). The web-link to the Bank’s CSR Policy is: https://www.icicibank.com/about-us/corporate- social-responsibility 2. Composition of the CSR Committee There were four Meetings of the Committee during fiscal 2024 – April 20, 2023, July 21, 2023, October 19, 2023 and January 18, 2024 Sr. No. Name of Director Designation/ nature of directorship Number of meetings of CSR Committee held during the year Number of meetings of CSR Committee attended during the year 1. Girish Chandra Chaturvedi (Chairman of Committee upto June 30, 2024) Non-Executive (part-time) Chairman / Independent Director 4 4 2. Pradeep Kumar Sinha (Member of Committee w.e.f. February 23, 2024, Chairman of Committee w.e.f. July 1, 2024) Independent Director 4^ - 3. Radhakrishnan Nair Independent Director 4 4 4. Uday Chitale Independent Director 4 4 5. Vibha Paul Rishi Independent Director 4 4 6. Anup Bagchi (Member of Committee upto April 30, 2023) Executive Director 4# 1 7. Rakesh Jha (Member of Committee w.e.f. May 1, 2023) Executive Director 4* 3 ^ No Meeting of the Committee was held during fiscal 2024 post induction of Pradeep Kumar Sinha on the Committee # One Meeting of the Committee was held during fiscal 2024 till the date of cessation of Anup Bagchi * Three Meetings of the Committee were held during fiscal 2024 post induction of Rakesh Jha on the Committee BOARD’S REPORT 114 | Annual Report 2023-24 3. Provide the web-link where Composition of CSR Committee, CSR Policy and CSR projects approved by the Board are disclosed on the website of the Company Link to the Bank’s CSR page is: https://www.icicibank.com/about-us/corporate- social-responsibility 4. Provide the executive summary along with web-link(s) of Impact Assessment of CSR Projects carried out in pursuance of sub-rule (3) of rule 8, if applicable The Bank has conducted impact assessment of twelve projects through external agencies during fiscal 2024. These include: 1. Impact assessment of MRI equipment provided to Tata Memorial Hospital, Mumbai, Maharashtra 2. Impact assessment of funds provided to patients for cancer treatment through the Indian Cancer Society 3. Impact assessment of cancer treatment equipment provided to Cachar Cancer Hospital and Research Centre, Silchar, Assam 4. Impact assessment of CT scan machine provided to Indo-Tibetan Border Police (ITBP) Force Composite Hospital, Dehradun, Uttarakhand 5. Impact assessment of cancer care equipment provided to Mahamana Pandit Madan Mohan Malviya Cancer Centre Hospital, Varanasi, Uttar Pradesh 6. Impact assessment of solar power installation at Dr. Shroff’s Charity Eye Hospital, Lakhimpur Kheri, Uttar Pradesh 7. Impact assessment of waste collection vehicles provided to Gorakhpur Municipal Corporation, Uttar Pradesh 8. Impact assessment of education grants provided to children of ex-servicemen and war widows through the Kendriya Sainik Board 9. Impact assessment of training infrastructure provided for enabling piped water supply to homes in Bihar 10. Impact assessment of financial inclusion programme 11. Impact assessment of social awareness programme, and 12. Impact assessment of fraud awareness campaign undertaken in 2022. The executive summary of impact assessment of the projects as referred above is provided in Annexure 1 of the Annual Report on CSR. Link to the impact assessment reports on the Bank’s website: https://www.icicibank.com/about-us/corporate- social-responsibility 5. (a) Average net profit of the Company as per sub-section (5) of Section 135 ` 284,474.8 million (b) Two percent of average net profit of the Company as per sub-section (5) of Section 135 ` 5,689.5 million (c) Surplus arising out of the CSR projects or programmes or activities of the previous financial years ` 171.2 million (d) Amount required to be set-off for the financial year, if any ` 688.1 million (e) Total CSR obligation for the financial year [(b)+(c)-(d)] ` 5,172.6 million 6. (a) Amount spent on CSR Projects (both ongoing project and other than ongoing projects) ` 5,179.9 million (includes unspent amount of ` 1,500.0 million budgeted for ongoing CSR project with Tata Memorial Centre, which was transferred to the Unspent CSR Account on April 15, 2024 and would be spent over three years, as per CSR rules.) (b) Amount spent in Administrative Overheads Nil BOARD’S REPORT Annual Report 2023-24 | 115 Integrated Report Statutory Reports Financial Statements (c) Amount spent on Impact Assessment, if applicable ` 8.8 million (d) Total amount spent for the Financial Year [(a) + (b) +(c)] ` 5,188.7 million (includes spends from surplus generated from CSR activities in fiscal 2023 of ` 171.2 million and spent by September 30, 2023, and unspent amount of ` 1,500.0 million budgeted for ongoing CSR project with Tata Memorial Centre, which was transferred to the Unspent CSR Account on April 15, 2024 and would be spent over three years, as per CSR rules.) (e) CSR amount spent or unspent for the financial year: Total amount spent in fiscal 2024 (in ` million) Amount unspent (in ` million) Total amount transferred to Unspent CSR Account as per Section 135(6) Amount transferred to any fund specified under Schedule VII as per second proviso to Section 135(5) Amount Date of transfer Name of the Fund Amount Date of transfer 3,688.7# 1,500.0* April 15, 2024 Nil NA NA # Includes spends from surplus generated from CSR activities in fiscal 2023 of ` 171.2 million and spent by September 30, 2023. * Unspent amount of ` 1,500.0 million pertains to the ongoing project on cancer care with Tata Memorial Centre. (f) Excess amount for set-off, if any Sr. No. Particular Amount (in ` million) (1) (2) (3) (i) 2% of average net profit of the Company as per Section 135(5) 5,001.5* (ii) Total amount spent for the Financial Year 5,188.7# (iii) Excess amount spent for the financial year [(ii)-(i)] 187.2 (iv) Surplus arising out of the CSR projects or programmes or activities of the previous financial years, if any 171.2 (v) Amount available for set off in succeeding financial years [(iii)-(iv)] 16.0 * Adjusted for excess amount of ` 688.1 million spent during fiscal 2023 and available for set off in fiscal 2024 # 1) Includes spends from surplus generated from CSR activities in FY2023 of ` 171.2 million that was transferred to the Unspent CSR Account in April 2023 and spent by September 30, 2023, as required by law. 2) Includes unspent amount of ` 1,500.0 million budgeted for the ongoing project on cancer care with Tata Memorial Centre. The amount was transferred to the Unspent CSR Account on April 15, 2024 and would be spent over three years as per CSR Rules. 7. Details of Unspent Corporate Social Responsibility amount for the preceding three Financial Years: Not applicable BOARD’S REPORT 116 | Annual Report 2023-24 8. Whether any capital assets have been created or acquired through Corporate Social Responsibility amount spent in the Financial Year: Yes If yes, enter the number of capital assets created/acquired 6,365  Furnish the details relating to such asset(s) so created or acquired through Corporate Social Responsibility amount spent in the Financial Year: The details will be available on the Bank’s website at https://www.icicibank.com/about-us/annual 9. Specify the reason(s), if the Company has failed to spend two per cent of the average net profit as per sub-section (5) of Section 135 The Bank has committed ` 12.00 billion to support Tata Memorial Centre (TMC) for expanding cancer treatment facility in the country. This entails setting up three centres in Maharashtra, Punjab and Andhra Pradesh, and is expected to double the capacity for cancer treatment by TMC. In fiscal 2024, ` 1,500.0 million was budgeted towards the ongoing project. Considering the nature and scale of the project, during the year detailed plans were being finalised for orderly execution of the project and the budgeted amount remained unspent. The amount was transferred to the Unspent CSR Account on April 15, 2024 and would be spent over three years as per CSR Rules. Sandeep Batra Girish Chandra Chaturvedi Executive Director CSR Committee Chairman DIN: 03620913 DIN: 00110996 June 29, 2024 BOARD’S REPORT Annual Report 2023-24 | 117 Integrated Report Statutory Reports Financial Statements ANNEXURE 1: SUMMARY OF IMPACT ASSESSMENT STUDIES CONDUCTED DURING FISCAL 2024 THROUGH EXTERNAL AGENCIES 1. Impact assessment of MRI equipment provided to Tata Memorial Hospital, Mumbai, Maharashtra As part of the focus to strengthen the healthcare capacity of hospitals, the Bank, through ICICI Foundation for Inclusive Growth (ICICI Foundation), provided a new MRI equipment to Tata Memorial Hospital at Mumbai at a cost of ` 50.0 million. The objective was to replace an outdated MRI equipment that was last upgraded in 2007 and help the hospital in improving patient throughput and provide better treatment. The life expectancy of the upgraded equipment was 10 years. Interviews were conducted of doctors, technicians, administrative staff and patients, based on a selected sample. Key findings of the assessment were: • Doctors and technicians highlighted the necessity for upgrading the outdated MRI equipment, as patient throughput was lower by 35% on average due to the time taken by the older equipment; • As the upgrade of the equipment was accompanied with an in-person training session, 100% of doctors and technicians confirmed that they were well-equipped for using the new machine; • 100% of the doctors and patients reported overall improvement in the treatment due to better quality of scans; • There was a 25% reduction in scan time, increasing the capability of the hospital to take more scans. About 80,000 patients are estimated to benefit from the upgrade during the lifespan of the equipment; • An increase in revenue of ` 3.5 lakh was reported by the hospital from the use of the upgraded equipment between July 2023 to March 2024, and which was being utilized for providing subsidized treatment to underprivileged patients. 2. Impact assessment of funds provided to patients for cancer treatment through the Indian Cancer Society ICICI Bank, through its implementing partner, ICICI Foundation, provided financial assistance to the Indian Cancer Society (ICS) to treat underprivileged patients diagnosed with any treatable/early detected cancer. Financial assistance aggregating ` 86.3 million was provided to 1,139 patients during fiscal 2023, of which 66% were women. The coverage was across 16 hospitals in 14 states. Key findings from the interviews conducted of patients, doctors and the ICS were: • More than 87% of the patients faced financial difficulties and emphasized the importance of financial assistance to help them with affordable treatment; • 75% patients reported that they received the funds at the right time to start the treatment; • 87% of the patients reported that they were able to complete the treatment from the financial assistance provided; • 53% of the patients seeking financial aid from hospitals supported by ICS were funded by ICICI Foundation; • Majority of the patients that received funds for cancer treatment were from low-income background, underscoring the relevance of the financial assistance. 3. Impact assessment of cancer treatment equipment provided to Cachar Cancer Hospital and Research Centre, Silchar, Assam In fiscal 2023, the Bank had provided cancer care equipment - Surgical CO2, comprehensive Endoscopy Station, and Micro Laryngeal Surgery set - to Cachar Cancer Hospital and Research Centre amounting to ` 10.1 million. The objective was to enhance the treatment facilities and enable better and accurate diagnosis and enhancing the cancer treatment facilities for patients. Interviews were conducted BOARD’S REPORT 118 | Annual Report 2023-24 of doctors, technicians, administrative staff and patients, based on a selected sample. Key findings of the study were: • 100% of the doctors reported that the hospital was facing challenges in diagnosing and treating patients with laryngeal cancers and providing timely interventions for those at risk of aspiration and associated pneumonia with head and neck cancer, before procuring the equipment; • 80% doctors reported that the cost of treatment had reduced after the procurement of the equipment as it helped in early and better detection and in reducing the requirement for sophisticated treatment; • Over 275 patients benefited from the equipment between July 2023 and March 2024; • Doctors and technicians stated that the equipment were in good condition of use and were procured as per National Accreditation Board for Hospitals (NABH) standards; • Patients receiving cancer treatment over the past few years mentioned that they were satisfied with the overall process, facility and treatment provided by the hospital. 4. Impact assessment of CT scan machine provided to Indo-Tibetan Border Police (ITBP) Force Composite Hospital, Dehradun, Uttarakhand The ITBP Composite Hospital in Dehradun serves as a crucial medical facility for para military forces, their families, and civilians in border areas. The hospital faced a gap in medical infrastructure, particularly the absence of a CT scan machine. Recognizing this critical need, ICICI Bank, through its implementation agency, ICICI Foundation, provided a state-of-the- art CT scan equipment amounting to ` 16.7 million to the hospital in fiscal 2023. The impact assessment utilized a mixed-method approach involving primary and secondary research, including interviews of patients and key hospital staff members. Key findings of the study were as follows: • The introduction of the CT scan machine improved healthcare services for both, civilians and armed forces personnel, and led to increase in patient flow and reduction in referrals, resulting in improved diagnostic accuracy and efficiency; • The CT scan equipment made diagnostic services more accessible to economically disadvantaged individuals; • The equipment led to significant cost savings for both the hospital and patients. The availability of an in-house CT scan, being more convenient and economical, has alleviated financial burden of patients; • The Social Return on Investment (SROI) from the support provided by the Bank is significant with every ` 1.00 invested contributing to a social return of ` 4.00 over a 10-year period. 5. Impact assessment of cancer care equipment provided to Mahamana Pandit Madan Mohan Malviya Cancer Centre (MPMMMCC) Hospital, Varanasi, Uttar Pradesh MPMMMCC, established under the Tata Memorial Centre, is dedicated to providing comprehensive cancer care services, offering affordable and advanced cancer treatment to the people of Purvanchal and adjoining regions. To strengthen the infrastructure at the hospital, the Bank through its implementation agency, ICICI Foundation, provided cancer care equipment, namely, Radio Frequency Ablation Machine (RITA System), Ultrasound System and Digital Subtraction Angiography (DSA) machine to the hospital at a total cost of ` 87.7 million. Key findings of the study were as follows: • The implementation of advanced radiology equipment(s) and services has led to enhancement in efficiency and quality within the Radiology Unit of the hospital. Key improvements include the introduction of Percutaneous Transhepatic Biliary Drainage (PTBD) services, addressing a critical gap in palliative care for patients with biliary obstructions; • The intervention has led to a 25% reduction in patient expenses and equipment operation costs; • The impact on patient treatment outcomes showed an approximately 80% reduction BOARD’S REPORT Annual Report 2023-24 | 119 Integrated Report Statutory Reports Financial Statements in waiting and treatment time for those needing DSA systems, 35% reduction for Radio Frequency Ablation machines and 25% reduction for ultrasound systems; • SROI analysis suggests that an investment of ` 1 by ICICI Bank contributes to a social return of ` 153 over a 10-year period. The high return reflected the critical nature of the intervention in providing health services in one of the poorest and densely populated regions of the country. 6. Impact assessment of waste collection vehicles provided to Gorakhpur Municipal Corporation, Uttar Pradesh Under this project, ICICI Foundation provided specialized garbage collection vehicles, at a total cost of ` 26.6 million, one each for the 40 wards of Gorakhpur Municipal Corporation. These vehicles were fitted with waste segregation facilities and were provided to enhance the waste management infrastructure and services across the city. ICICI Foundation also participated in awareness programmes and campaigns along with the Gorakhpur Municipal Corporation within these wards. Some key insights from the project were: • The project led to extension of waste collection services to previously underserved areas, covering an additional 14,000 households, representing an 8% increase in service reach; • The introduction of specialized garbage collection vehicles resulted in a marked decline in open littering within their operational areas; • The project also yielded favourable environmental and health outcomes, with 79% of the residents expressing confidence in its positive impact on cleanliness within their respective wards over the past year; • The initiative led to improved awareness and adoption of responsible waste management habits at the source. It also led to a significant improvement in community awareness on waste segregation; • The initiative also resulted in a shift towards improved waste segregation practices at the household level, with the proportion of households engaging in segregation rising from 38% to 67%; • Some of the garbage collection vehicles experienced occasional breakdowns which added to the maintenance costs for the Municipality. 7. Impact assessment of solar power installation at Dr. Shroff’s Charity Eye Hospital, Lakhimpur Kheri, Uttar Pradesh Dr. Shroff’s Charity Eye Hospital (SCEH) has been providing opthalmic care services to the poor free of cost or at subsidized rates. However, in areas like Lakhimpur Kheri, there are also challenges with availability of electricity. With an objective to address this need, ICICI Foundation funded the installation of a 240 KWp solar power unit with 220 KWp on-grid solutions and 20 KWp off-grid solutions amounting to ` 15.9 million at SCEH. The unit had an integrated DG power system, an innovation that allowed power back-ups. The project goal was to support the hospital in switching to clean energy and reducing its operational cost, thus providing affordable eye care to the poor and vulnerable segments of the population. The impact assessment focused on understanding the relevance and effectiveness of the intervention. Key findings of the study were: • The solar installation led to reduction in electricity expenditure of the hospital by 38.3%, compared to pre-installation period; • The project also led to a 50.5% reduction in diesel consumption by the hospital from May 2022 to August 2023; • Due to the decrease in diesel usage, there was a 58.1% reduction in carbon emissions in February 2024 as compared to May 2022, the baseline month; • There was a significant improvement in service delivery, staffing, and hospital infrastructure as a result of the reduction in energy expenditure; • The project also led to a reduction in per‑patient energy cost from ` 133 before the solar installation to ` 72 in February 2024. BOARD’S REPORT 120 | Annual Report 2023-24 8. Impact assessment of education grants provided to children of ex-servicemen and war widows through the Kendriya Sainik Board Under this project, ICICI Foundation donated ` 20.0 million to the Armed Forces Flag Day Fund (AFFDF) that was established for the welfare of veterans, martyrs, and their dependents. This contribution was specifically allocated as an education support for the wards of veterans and army widows from the non-commissioned officer’s category. A monthly support of ` 1,000 per child for a maximum of two children was provided to 1,668 families. The key findings were: • The project had a positive impact on assisting Ex-Servicemen (ESM) and army widows in overcoming financial obstacles related to their children's education; • 45.7% of the respondents earned less than ` 3 lakh annually, while 47.8% earned between ` 3 lakh and ` 6 lakh; • Half of the beneficiaries support one or more elderly dependents; 23.9% support one elderly person, and 26.1% support two elderly people; • For 19.6% of the beneficiaries, the education grant covered 75% to 100% of annual education expenses, including tuition fees, uniforms, study materials, transport, and other costs. It fully covered expenses for 8.7% of the recipients; • A large proportion, 91.3% of beneficiaries, used the education support to pay for tuition fees. 67.4% could purchase study material with the support, and 15.2% utilized it for transportation expenses. 9. Impact assessment of training infrastructure for enabling piped water supply to homes in Bihar The Bank, through its implementation partner, ICICI Foundation, has provided infrastructure support in the form of a training centre including digital training resources and mobile training vans equipped with essential plumbing tools and water testing kits costing ` 11.8 million. This was provided to the Public Health Engineering Department (PHED) in Bihar. The objective was to enhance the reach of the government’s 'Har Ghar Nal Ka Jal' Scheme that aims to provide universal access to safe drinking water to every household in the state, particularly focusing on marginalised communities. Key findings of the study were: • Around 175 people were trained between April-December 2023 at the training centre through various capacity-building workshops and seminars, which included employees of PHED like the Chief Engineer, engineers & supervisors and trainers; • The mobile training vans benefitted close to 18,000 individuals across nine districts, by receiving training in their local area; • Practical sessions conducted directly in the field enabled the participants to apply their training immediately to address local water management and plumbing issues; • Respondents expressed that the toolkits provided in the mobile training units were thoughtfully assembled to meet the specific needs of mobile training; • Respondents appreciated the state-of-the-art classroom setup and the inclusion of essential tools for hands-on learning. The availability of a mini water testing lab and sustainable energy solutions, like the 6KW solar panel, were also noted as significant enhancements that contributed to a better learning environment; • The project extended the reach of training to remote and underserved communities especially the marginalized communities. 10. Impact assessment of ICICI Bank’s financial inclusion programme The financial inclusion programme of the Bank focusses on improving digital access to banking services for the rural people. The programme, implemented through business correspondents, (BCs) has enabled rural families to save money and access government services, while bringing a positive change in terms of savings. The total investment by ICICI Bank for this initiative amounted to ` 55.1 million. The agency adopted a two-pronged approach which included a review of secondary data BOARD’S REPORT Annual Report 2023-24 | 121 Integrated Report Statutory Reports Financial Statements sources and literature and primary data obtained from quantitative and qualitative methods of data collection. The key findings of the study were: • 77% beneficiaries agreed on increased awareness of financial services through the programme; • 90% beneficiaries confirmed a reduction in travel distance to access financial services; • 72% beneficiaries started saving every three months, while 72% had insurance coverage; • 84% of the surveyed beneficiaries acknowledged the importance of financial inclusion, suggesting a recognition of its role in economic stability and individual empowerment. 11. Impact assessment of ICICI Bank’s social awareness programme The social awareness programme of the Bank aims at fostering knowledge and encouraging positive behavioural shifts among people. In fiscal 2023, strategic placement of digital signages amounting to ` 349.8 million were undertaken to display relevant social messages. The project spanned 25 locations across Ahmedabad, Delhi, and Mumbai. The digital screens display diverse messages on social awareness topics such as road safety, health, sanitation, and environmental conservation practices. Some key insights of the assessment were: • 68% of respondents rated the messages displayed on LED screens as either "moderately effective" or "very effective" in promoting behaviours conducive to sustainability; • 85% of respondents expressed a high probability of sharing the messages displayed on the LED boards with peers; • The daily effective circulation (DEC), which is the average number of people passing by, was observed to be more than 5 million. This implied an annual visibility impression of 600 million; • The messages promoted seven UN Sustainable Development Goals (SDGs) of good health and well-being, quality education, clean water and sanitation, sustainable cities and communities, responsible consumption and production, life below water and life on land. 68% of respondents rated the performance of the digital screens as either "Excellent" or "Good”; • A recommendation by the agency was to install bigger or different size boards in heavy traffic areas to improve visibility and effectiveness of the social message. 12. Impact assessment of ICICI Bank’s fraud awareness campaign undertaken in fiscal 2022 As part of an initiative to promote safe banking practices, ICICI Bank launched a campaign to create public awareness about three prevalent cyber frauds, namely UPI Pin Fraud, QR Code Fraud and Lottery Fraud. The campaign was launched in multiple languages through various mediums such as social media, website, mass media (TV advertisements) and through direct email communication. The total investment by ICICI Bank for this initiative amounted to ` 86.0 million. To understand the impact of the campaign, a study was undertaken through a survey of 900 individuals. Key findings of the survey were: • More than 80% of the respondents were able to recall the campaign displaying a strong recall value of the public awareness advertisements; • A significant majority of respondents became alert to fraudulent activities after watching the campaign. Notably, 70% of respondents shared information about these frauds within their social circles, while 61% actively engaged by sharing it on social media platforms, indicating the campaign's ability to spur proactive awareness and action; • The Fraud awareness campaign has also been effective in raising awareness of key safe banking practices. All the four safe banking practices highlighted in the campaign, namely, not sharing sensitive information, not clicking on suspicious links/downloading attachments, never responding to unknown lottery messages and never entering UPI PIN to receive money, appeared among the top five most known safe banking practices among those exposed to the campaign. 122 | Annual Report 2023-24 CERTIFICATE ON COMPLIANCE OF CONDITIONS OF CORPORATE GOVERNANCE To The Members of ICICI Bank Limited We have examined the compliance of conditions of Corporate Governance by ICICI Bank Limited (“the Bank”) for the financial year ended March 31, 2024, as prescribed in Regulations 17 to 27, clauses (b) to (i) and (t) of sub-regulation (2) of Regulation 46 of Chapter IV and Paras C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time. (“SEBI Listing Regulations”). We state that the compliance of conditions of Corporate Governance is the responsibility of the management and our examination was limited to procedures and implementation process thereof adopted by the Bank for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the Financial Statements of the Bank. We have examined the relevant records and documents maintained by the Bank for the purpose of providing reasonable assurance and certifying on the compliance with Corporate Governance requirements by the Bank. In our opinion and to the best of our information and according to the explanations and information furnished to us we certify that the Bank has complied with the conditions of Corporate Governance as stipulated in the aforesaid provisions of the SEBI Listing Regulations. We further state that such compliance is neither an assurance as to the future viability of the Bank nor the efficiency or effectiveness with which the management has conducted the affairs of the Bank. Place : Mumbai ALWYN JAY & Co. Date : June 28, 2024 Company Secretaries Office Address : [Alwyn D’Souza, FCS.5559] Annex-103, Dimple Arcade, [Partner] Asha Nagar, Kandivali (East), [Certificate of Practice No.5137] Mumbai 400101. [UDIN : F005559F000633714] CERTIFICATE ON CORPORATE GOVERNANCE Annual Report 2023-24 | 123 Integrated Report Statutory Reports Financial Statements MANAGEMENT DISCUSSION & ANALYSIS OPERATING ENVIRONMENT Global growth momentum is expected to slow from 3.2% year-on-year in calendar year 2023 to 3.0% in calendar year 2024 led primarily by softer growth prospects in Europe and China. The US economy is showing continued resilience and is expected to grow above its trend pace. The moderate softening in global growth reflects the ongoing lagged effect of restrictive monetary policy weighing on demand, however a recession is unlikely. At the same time, headline inflation could continue to moderate. The persistence of services inflation could limit the scale of disinflation over fiscal 2024 as compared to that witnessed over H2-2023. Developed Market (DM) central banks are poised to ease policy with the European Central Bank (ECB) and Bank of England (BoE) expected to lead Federal Reserve Open Market Committee (FOMC) in commencing easing policy. Risks to the global growth outlook are to the downside, including a further escalation in geo-political tensions that pushes global energy prices sharply higher and monetary policy working to reduce inflation and compress growth much more than assumed. Growth In Q4-2024, India’s real Gross Value Added (GVA) grew 6.5% year-on-year, while Gross Domestic Product (GDP) grew by 7.8% year-on-year led by lower subsidy payout. Given government infra spending, corporate capex cycle and real estate investment by households, we should see investment to remain the key driver of India’s growth in coming years. Services demand is buoyant on the back of travel, real estate and financial services. Growth for fiscal 2024 has been revised higher at 8.2% year-on-year from 7.6% earlier. The upward revision is led by Q4-2024 GDP growth coming in far stronger than earlier estimated (lower subsidy payout). Inflation Inflation, as measured by the Consumer Price Index (CPI), softened from 5.7% year-on-year in March 2023 to 4.9% year-on-year in March 2024, compared to an average inflation of 5.4% year-on-year in fiscal 2024. Food inflation on the other hand rose to 7.7% year-on- year, while core inflation was lower at 3.2% year-on-year. The most important factor working in favour of inflation is the easing core inflation. Given the above backdrop CPI inflation is expected to average 4.5% for the year. Interest rates In May 2022, the Monetary Policy Committee (MPC) delivered its first post-pandemic hike of 40 basis points, taking the repo rate to 4.4%. More rate hikes followed: 50 basis points in June 2022, 50 basis points in August 2022, 50 basis points in September 2022, 35 basis points in December 2022 and 25 basis points in February 2023, taking the cumulative rate hikes to 250 basis points during fiscal 2023. However, the MPC surprised markets by keeping the policy rate unchanged at 6.5% in the meeting held in April 2023, since then till the last MPC held in April 2024, the policy rate and the policy stance has been kept unchanged. The Reserve Bank of India (RBI) announced various measures to manage the liquidity conditions. For example, the RBI had announced a temporary incremental Cash Reserve Ratio (CRR) rate of 10.0% on the incremental deposits between May 19, 2023 and July 28, 2023. The same was reversed by October 7, 2023. Further, the RBI also announced that it would conduct Open Market Operation (OMO) sales to manage liquidity conditions. System liquidity reduced from an average of ` 25.0 billion in the month of March 2023 to ` -434.0 billion in March 2024. The transmission of monetary policy resulted in an increase in interest rates in the banking system. Between April 2023 and February 2024, the Weighted Average Lending Rate (WALR) of commercial banks on fresh rupee loans increased by 28 basis points. Since April 2022, the same has increased by 185 basis points. Financial markets During fiscal 2024, the Rupee depreciated by 1.4% from ` 82.18 per USD at March 31, 2023 to ` 83.35 per USD at March 29, 2024. With the geopolitical tensions in West Asia, the Rupee touched ` 83.75 per USD at April 17, 2024. The benchmark S&P BSE Sensex increased by 24.85% during fiscal 2024 compared to 0.7% in fiscal 2023. The yields on the benchmark 10-year government securities was range bound, moving from 7.31% at March 31, 2023 to 7.06% at March 29, 2024, with a highest of 7.38% on October 9, 2023. Banking sector trends Non-food credit of the banking system displayed robust growth, with growth of 20.2% year-on-year in March 2024 (16.3% year-on-year ex merger) compared to 15.4% year- on-year in March 2023, with incremental credit growth of ` 22.2 trillion in the period April 2023 to March 2024. The fortnightly credit outstanding on 5th April showed 19.9% year-on-year growth (16.1% year-on-year ex merger). Sectoral break-up of credit data available till March 2024, credit growth was led by services at 22.9% year-on-year (20.2% year-on-year ex merger) and personal credit at 27.6% year-on-year (17.7% year-on-year ex merger). In addition, industry credit also showed an uptick in growth at 9.0% year-on-year (8.5% year-on-year ex merger). MANAGEMENT DISCUSSION & ANALYSIS 124 | Annual Report 2023-24 According to RBI’s Financial Stability Report of June 2024, non-performing assets (NPAs) of scheduled commercial banks continued to decline in fiscal 2024, with gross NPA ratio at 2.8% and net NPA ratio at 0.6% at March 31, 2024 compared to a gross NPA ratio of 3.9% and net NPA ratio of 1.0% at March 31, 2023. Outlook The MPC expectedly kept the repo rate unchanged at the April 2024 review, now for 7th time in a row. The stance also remained unchanged as ‘withdrawal of accommodation’. The US Fed is expected to delay its rate cut cycle, while uncertain geo-political environment poses an inflationary risk. As a result, RBI’s rate cut cycle is likely to be delayed from our earlier expectation of October. The timing of change in stance and policy cut in India remains contingent upon commodity prices and global monetary easing cycle. STRATEGY In fiscal 2024, the Bank maintained its strategic focus on profitable growth in business within the guardrails of risk and compliance. The Bank grew its credit portfolio with a focus on granularity and saw healthy growth across segments. The Bank continued to focus on customer 360-degree approach and holistically serving across ecosystems and micromarkets. The Bank sought to maintain and enhance its liability franchise. The Bank focused on maintaining a strong balance sheet, with adequate liquidity, prudent provisioning and healthy capital adequacy. The Bank’s capital adequacy ratios were well above regulatory requirements as of March 31, 2024. Going forward, the Bank would focus on maximizing the profit before tax excluding treasury within the guardrails of compliance and risk management. The Bank believes there are significant opportunities for profitable growth across various sectors of the Indian economy. The Risk Appetite and Enterprise Risk Management framework articulates the Bank’s risk appetite and drills it down into a limit framework for various risk categories. The Bank is fostering a strong risk and compliance culture that underpins our dealing with customers. The Bank has laid strong emphasis on continuous strengthening of operational resilience for seamless delivery of services to customers. A strong focus was also laid on deepening coverage and enhancing delivery capabilities while continuing the focus on risk calibrated profitable growth. We continue to focus on simplifying banking for improved customer experiences and enhance customer engagement. The Bank will focus on growing its loan portfolio in a granular manner with a focus on risk and reward, with return of capital and containment of provisions within targeted levels being a key imperative. There are no specific targets for loan mix or segment-wise loan growth. The Bank would aim to continue to grow its deposit franchise, maintain a stable and healthy funding profile and competitive advantage in cost of funds. See also “Integrated Report – Our Business Strategy”. STANDALONE FINANCIALS AS PER INDIAN GAAP Summary Profit before tax (excluding treasury gains) increased by 28.3% from `  424.73 billion in fiscal 2023 to `  544.79 billion in fiscal 2024. Core operating profit (i.e. profit before provisions and tax, excluding treasury gains) increased by 18.3% from ` 491.39 billion in fiscal 2023 to ` 581.22 billion in fiscal 2024 primarily due to an increase in net interest income by `  121.77 billion and fee income by ` 27.95 billion, offset, in part, by an increase in operating expenses by `  62.60 billion. Gain from treasury-related activities was `  0.09 billion in fiscal 2024 as compared to a loss of `  0.52 billion in fiscal 2023. Provisions and contingencies (excluding provision for tax) decreased by 45.3% from ` 66.66 billion in fiscal 2023 to ` 36.43 billion in fiscal 2024. Profit after tax increased from `  318.96 billion in fiscal 2023 to ` 408.88 billion in fiscal 2024. Net interest income increased by 19.6% from `  621.29 billion in fiscal 2023 to ` 743.06 billion in fiscal 2024 due to an increase in the net interest margin (NIM) and an increase in the average interest-earning assets. Fee income increased by 15.5% from ` 180.01 billion in fiscal 2023 to `  207.96 billion in fiscal 2024. Dividend from subsidiaries/joint ventures/associates increased by 16.2% from ` 17.84 billion in fiscal 2023 to ` 20.73 billion in fiscal 2024. Operating expenses increased by 19.0% from ` 328.73 billion in fiscal 2023 to ` 391.33 billion in fiscal 2024. Provisions and contingencies (excluding provision for tax) decreased by 45.3% from `  66.66 billion in fiscal 2023 to ` 36.43 billion in fiscal 2024 primarily due to a decrease in contingency provision made on a prudent basis and provision for investments, offset, in part, by an increase in provisions for non-performing and other assets and provision for standard assets. Provision for non-performing and other assets was `  9.45 billion in fiscal 2024 as compared to a write-back of ` 6.23 billion in fiscal 2023. During fiscal 2024, there were higher net additions to non-performing loans primarily in retail and rural loans, offset, in part, by recoveries and upgrades in non-retail loans. The provision coverage ratio on NPAs decreased from 82.8% at March 31, 2023 to 80.3% at March 31, 2024. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 125 Integrated Report Statutory Reports Financial Statements During fiscal 2023, the Bank had made an additional contingency provision ` 56.50 billion on a prudent basis. The Bank held contingency provision of ` 131.00 billion at March 31, 2024. The income tax expense increased from ` 105.25 billion in fiscal 2023 to ` 136.00 billion in fiscal 2024. The effective tax rate increased from 24.8% in fiscal 2023 to 25.0% in fiscal 2024 primarily due to change in composition of income. Net worth increased by 18.8% from ` 2,007.16 billion at March 31, 2023 to ` 2,383.99 billion at March 31, 2024 primarily due to accretion to reserves out of retained profit, offset, in part, by payment of dividend for fiscal 2023. Total assets increased by 18.1% from ` 15,842.07 billion at March 31, 2023 to ` 18,715.15 billion at March 31, 2024. Total advances increased by 16.2% from `  10,196.38 billion at March 31, 2023 to ` 11,844.06 billion at March 31, 2024 primarily due to an increase in domestic advances by 16.8%. Total investments increased by 27.5% from ` 3,623.30 billion at March 31, 2023 to ` 4,619.42 billion at March 31, 2024. Cash and cash equivalents increased by 17.2% from `  1,194.38 billion at March 31, 2023 to ` 1,399.26 billion at March 31, 2024. The weighted average high-quality liquid assets maintained during the three months ended March 31, 2024 were `  3,940.11 billion (three months ended March 31, 2023: ` 3,234.60 billion). The average liquidity coverage ratio was 122.84% for the three months ended March 31, 2024 as against the requirement of 100.00%. Total deposits increased by 19.6% from ` 11,808.41 billion at March 31, 2023 to ` 14,128.25 billion at March 31, 2024. Term deposits increased by 27.7% from ` 6,395.79 billion at March 31, 2023 to ` 8,169.53 billion at March 31, 2024. Current and savings account (CASA) deposits increased by 10.1% from `  5,412.62 billion at March 31, 2023 to `  5,958.72 billion at March 31, 2024. Average CASA deposits increased by 6.5% from `  4,758.90 billion in fiscal 2023 to ` 5,067.47 billion in fiscal 2024. Borrowings increased by 4.7% from `  1,193.25 billion at March 31, 2023 to ` 1,249.68 billion at March 31, 2024. The Bank had a business center (branch) network of 6,523 branches, and network of 17,190 ATMs/CRMs at March 31, 2024. The Bank is subject to Basel III capital adequacy guidelines stipulated by RBI. The total capital adequacy ratio of the Bank at March 31, 2024 (after deducting proposed dividend for fiscal 2024 from capital funds) in accordance with RBI guidelines on Basel III was 16.33% as compared to 18.34% at March 31, 2023. The Tier-1 capital adequacy ratio was 15.60% at March 31, 2024 as compared to 17.60% at March 31, 2023. The Common Equity Tier 1 (CET-1) ratio was 15.60% at March 31, 2024 as compared to 17.12% at March 31, 2023. OPERATING RESULTS DATA The following table sets forth, for the periods indicated, the operating results data. ` in billion, except percentages Particulars Fiscal 2023 Fiscal 2024 % change Interest income 1,092.31 1,428.91 30.8 Interest expense 471.02 685.85 45.6 Net interest income 621.29 743.06 19.6 Fee income1 180.01 207.96 15.5 Dividend from subsidiaries/joint ventures/associates 17.84 20.73 16.2 Other income 0.98 0.80 (18.4) Core operating income 820.12 972.55 18.6 Operating expenses 328.73 391.33 19.0 Core operating profit 491.39 581.22 18.3 Treasury gains (0.52) 0.09 - Operating profit 490.87 581.31 18.4 Provisions, net of write-backs 66.66 36.43 (45.3) Profit before tax 424.21 544.88 28.4 Tax, including deferred tax 105.25 136.00 29.2 Profit after tax 318.96 408.88 28.2 1 Includes merchant foreign exchange income, income on customer derivative transactions and income on sale of priority sector lending certificates (PSLCs). 2 All amounts have been rounded off to the nearest ` 10.0 million. 3 Prior period figures have been re-grouped/re-arranged, where necessary. MANAGEMENT DISCUSSION & ANALYSIS 126 | Annual Report 2023-24 Key ratios The following table sets forth, for the periods indicated, the key financial ratios. Particulars Fiscal 2023 Fiscal 2024 Return on average equity (%)1 17.28 18.71 Return on average assets (%)2 2.16 2.37 Net interest margin (%) 4.48 4.53 Cost to income (%)3 40.11 40.23 Provisions to core operating profit (%) 13.57 6.27 Earnings per share (`) 45.79 58.38 Book value per share (`) 287.44 339.49 1 Return on average equity is the ratio of the net profit after tax to the quarterly average equity share capital and reserves. 2 Return on average assets is the ratio of net profit after tax to average assets. 3 Cost represents operating expense. Income represents net interest income and non-interest income. The return on average equity, return on average assets and earnings per share increased primarily due to an increase in profit after tax. Net interest income and spread analysis The following table sets forth, for the periods indicated, the net interest income and spread analysis. ` in billion, except percentages Particulars Fiscal 2023 Fiscal 2024 % change Interest income 1,092.31 1,428.91 30.8 Interest expense 471.02 685.85 45.6 Net interest income 621.29 743.06 19.6 Average interest-earning assets 13,872.53 16,412.08 18.3 Average interest-bearing liabilities 11,998.16 14,121.39 17.7 Net interest margin 4.48% 4.53% - Average yield 7.87% 8.71% - Average cost of funds 3.93% 4.86% - Interest spread 3.94% 3.85% - 1 All amounts have been rounded off to the nearest ` 10.0 million. Net interest income increased by 19.6% from ` 621.29 billion in fiscal 2023 to ` 743.06 billion in fiscal 2024 primarily due to an increase in the net interest margin by 5 basis points and an increase of 18.3% in the average interest- earning assets. Net interest margin increased by 5 basis points from 4.48% in fiscal 2023 to 4.53% in fiscal 2024. The loan book of the Bank got repriced faster because of higher proportion of repo and other floating rate linked book, while the cost of deposits increased with a lag given the fixed rate nature of the term deposit book. As a result, the net interest margin increased from 3.96% in fiscal 2022 to 4.48% in fiscal 2023 and to 4.53% in fiscal 2024. Net interest margin was 4.01% in Q1-2023 and started increasing from Q2-2023, peaking at 4.90% in Q4-2023. The net interest margin thereafter starting declining, reflecting the peaking of asset yields and rise in deposit cost to 4.40% in Q4-2024. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 127 Integrated Report Statutory Reports Financial Statements The following table sets forth, for the periods indicated, the trend in yield, cost, spread and margin. Particulars Fiscal 2023 Fiscal 2024 Yield on interest-earning assets 7.87% 8.71% - On advances 8.94 9.83 - On investments 6.57 7.18 - On SLR investments 6.62 7.16 - On other investments 6.16 7.34 - On other interest-earning assets 3.38 2.90 Cost of interest-bearing liabilities 3.93 4.86 - Cost of deposits 3.66 4.61 - Current and savings account (CASA) deposits 2.28 2.24 - Term deposits 4.78 6.21 - Cost of borrowings 5.97 6.86 Interest spread 3.94 3.85 Net interest margin 4.48% 4.53% The yield on average interest-earning assets increased by 84 basis points from 7.87% in fiscal 2023 to 8.71% in fiscal 2024 primarily due to the following factors: • The yield on domestic advances increased by 77 basis points from 9.16% in fiscal 2023 to 9.93% in fiscal 2024. The yield on advances increased primarily due to full impact of re-pricing of existing floating rate loans linked to the repo rate and the Bank’s Marginal Cost of funds based Lending Rate (MCLR) to a higher rate and new lending at higher rates. At March 31, 2023, of the total domestic loan book 49% had interest rate linked to repo rate, 32% had fixed interest rates, 17% had interest rate linked to MCLR and other older benchmarks and 2% had interest rate linked to other external benchmarks. The Bank’s 1-year MCLR increased by 150 basis points in phases during FY2023 and by 35 basis points in phases during FY2024 from 8.75% in March 2023 to 9.10% in January 2024. RBI increased the repo rate by 250 basis points from 4.00% in May 2022 to 6.50% in February 2023. The impact of increase in repo rates from May 2022 started reflecting in overall yield through repricing of the repo and T-bill linked portfolio from Q2-2023 and onwards. For MCLR linked loans, the effect on the yields is based on respective reset dates of underlying loans. Further, the future movement in the yield on advances will depend on the increase/decrease in the repo rate and the systemic interest rates. The yield on overseas advances increased by 285 basis points from 3.90% in fiscal 2023 to 6.75% in fiscal 2024 primarily due to repricing of floating rate advances and new lending at higher rates on account of the rate hike by the US Federal Reserve. The yield on overseas advances was also positively impacted due to higher interest collection on NPAs during the fiscal 2024. The yield on average interest-earning assets increased by 84 basis points from 7.87% in fiscal 2023 to 8.71% in fiscal 2024 primarily due to an increase in yield on average advances and investments and an increase in proportion of average advances. The cost of funds increased by 93 basis points from 3.93% in fiscal 2023 to 4.86% in fiscal 2024 primarily due to an increase in cost of term deposits. The interest spread decreased by 9 basis points from 3.94% in fiscal 2023 to 3.85% in fiscal 2024. MANAGEMENT DISCUSSION & ANALYSIS 128 | Annual Report 2023-24 The overall yield on average advances increased by 89 basis points from 8.94% in fiscal 2023 to 9.83% in fiscal 2024. • The yield on average interest-earning investments increased by 61 basis points from 6.57% in fiscal 2023 to 7.18% in fiscal 2024. The yield on Indian government investments increased by 54 basis points from 6.62% in fiscal 2023 to 7.16% in fiscal 2024. This was primarily due to reset of yields on floating rate bonds linked to treasury bills (T-bills) at higher rates pursuant to a significant increase in treasury bill yields, and new investment in government securities at higher market yields (both to replace maturing securities and as fresh purchases). The yield on non-SLR investments increased by 118 basis points from 6.16% in fiscal 2023 to 7.34% in fiscal 2024 primarily due to an increase in yield on pass through certificates, commercial paper, foreign government securities and an increase in proportion of average pass through certificates. • The yield on other interest-earning assets decreased by 48 basis points from 3.38% in fiscal 2023 to 2.90% in fiscal 2024. The decrease was primarily due to a decrease in income on funding swaps, a decrease in average interest earning LAF (Liquidity Adjustment Facility) lending to RBI and an increase in average balance with RBI, which does not earn any interest. The decrease in yield on other interest-earning assets was offset, in part, by an increase in yield on call and term money lent and an increase in yield on balance with other banks. Interest on income tax refund increased from ` 1.14 billion in fiscal 2023 to ` 2.65 billion in fiscal 2024. The receipt, amount and timing of such income depends on the nature and timing of determinations by tax authorities and are hence neither consistent nor predictable. The cost of funds increased by 93 basis points from 3.93% in fiscal 2023 to 4.86% in fiscal 2024 primarily due to the following factors: • The cost of average deposits increased from 3.66% in fiscal 2023 to 4.61% in fiscal 2024 primarily due to an increase in cost of domestic term deposits. The cost of domestic term deposits increased by 142 basis points from 4.80% in fiscal 2023 to 6.22% in fiscal 2024 primarily due to repricing of deposits at higher rates, offset, in part, by benefit of pre-mature withdrawals of existing deposits which were re-invested by customers at the new higher rates. The peak rate for retail term deposits increased significantly in phases from 5.75% in May 2022 to 7.10% in February 2023 on account of significant increase in repo rate. The cost of savings account deposits increased marginally from 3.16% in fiscal 2023 to 3.17% in fiscal 2024. The average CASA deposits decreased from 44.7% of total average deposits in fiscal 2023 to 40.4% of total average deposits in fiscal 2024. Average CASA deposits were 35.9% of the total funding (i.e., deposits and borrowings) for fiscal 2024 as compared to 39.7% for fiscal 2023. • The cost of borrowings increased by 89 basis points from 5.97% in fiscal 2023 to 6.86% in fiscal 2024. The cost of domestic borrowings increased by 28 basis points from 6.66% in fiscal 2023 to 6.94% in fiscal 2024 primarily due to an increase in cost of refinance borrowings, call money borrowings and inter- bank participatory certificates, offset, in part, by a decrease in proportion of average bond borrowings. The cost of overseas borrowings increased by 287 basis points from 3.29% in fiscal 2023 to 6.16% in fiscal 2024 primarily due to an increase in cost of term borrowings, bond borrowings and an increase in cost of margin deposit received for treasury products. The Bank’s interest income, yield on advances, net interest income and net interest margin are impacted by systemic liquidity, the competitive environment, level of additions to non-performing loans, regulatory developments, monetary policy and economic and geopolitical factors. Interest rates on about 51% of Bank’s domestic loans are linked to external market benchmarks. The differential movements in the external benchmark rates compared to cost of funds of the Bank impact the Bank’s net interest income and net interest margin. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 129 Integrated Report Statutory Reports Financial Statements The following table sets forth, for the period indicated, the trend in average interest-earning assets and average interest- bearing liabilities: ` in billion, except percentages Particulars Fiscal 2023 Fiscal 2024 % change Advances1 9,390.62 11,283.57 20.2 Interest-earning investments2 3,180.93 3,987.01 25.3 Other interest-earning assets 1,300.98 1,141.50 (12.3) Total interest-earning assets 13,872.53 16,412.08 18.3 Deposits 10,634.91 12,557.61 18.1 Borrowings1,2 1,363.25 1,563.78 14.7 Total interest-bearing liabilities 11,998.16 14,121.39 17.7 1 Average borrowing and average advances have been grossed up for average participation certificate and average bills rediscounting. 2 Average investments and average borrowings include average short-term repurchase transactions. 3 All amounts have been rounded off to the nearest ` 10.0 million. The average interest-earning assets increased by 18.3% from ` 13,872.53 billion in fiscal 2023 to ` 16,412.08 billion in fiscal 2024 due to an increase in average advances by `  1,892.95 billion and average investments by `  806.08 billion, offset, in part, by a decrease in average other interest-earning assets by ` 159.48 billion. Average advances increased by 20.2% from `  9,390.62 billion in fiscal 2023 to ` 11,283.57 billion in fiscal 2024 due to an increase of 21.5% in average domestic advances, offset, in part, by a decrease of 10.5% in average overseas advances. Average interest-earning investments increased by 25.3% from ` 3,180.93 billion in fiscal 2023 to ` 3,987.01 billion in fiscal 2024 Average interest-earning investments in Indian government securities increased by 23.1% from ` 2,809.55 billion in fiscal 2023 to ` 3,459.66 billion in fiscal 2024. Average interest-earning non-SLR investments increased from ` 371.38 billion in fiscal 2023 to ` 527.35 billion in fiscal 2024. Average other interest-earning assets decreased by 12.3% from ` 1,300.98 billion in fiscal 2023 to ` 1,141.50 billion in fiscal 2024 primarily due to a decrease in call and term money lent and Rural infrastructure development fund (RIDF) and related deposits, offset, in part, by an increase in balance with RBI. Average interest-bearing liabilities increased by 17.7% from ` 11,998.16 billion in fiscal 2023 to ` 14,121.39 billion in fiscal 2024 primarily due to an increase in average deposits by ` 1,922.70 billion and an increase in average borrowings by ` 200.53 billion. Average deposits increased by 18.1% from ` 10,634.91 billion in fiscal 2023 to ` 12,557.61 billion in fiscal 2024 due to an increase in average term deposits and average CASA deposits. Average borrowings increased by 14.7% from ` 1,363.25 billion in fiscal 2023 to `  1,563.78 billion in fiscal 2024 primarily due to an increase in refinance borrowings and inter-bank participatory certificates, offset, in part, by a decrease in subordinated bonds. FEE INCOME Fee income primarily includes fees from retail customers such as loan processing fees, fees from cards business, account servicing charge, income from foreign exchange transactions and third party referral fees and commercial banking fees such as loan processing fees and transaction banking fees, income from foreign exchange transactions and margin on derivative transactions. Fee income increased by 15.5% from ` 180.01 billion in fiscal 2023 to ` 207.96 billion in fiscal 2024 primarily due to an increase in payment and cards fees, income from forex and derivatives products, lending linked fees and commercial banking fees. DIVIDEND FROM SUBSIDIARIES/JOINT VENTURES/ASSOCIATES Dividend from subsidiaries/joint ventures/associates increased by 16.2% from ` 17.84 billion in fiscal 2023 to ` 20.73 billion in fiscal 2024. MANAGEMENT DISCUSSION & ANALYSIS 130 | Annual Report 2023-24 The following table sets forth, for the periods indicated, the details of dividend received from subsidiaries/joint ventures/ associates: ` in billion Name of the entity Fiscal 2023 Fiscal 2024 ICICI Bank Canada 1.06 2.14 ICICI Bank UK PLC 0.80 0.83 ICICI Prudential Life Insurance Company Limited 0.40 0.44 ICICI Lombard General Insurance Company Limited 2.24 2.48 ICICI Prudential Asset Management company Limited 6.22 7.53 ICICI Securities Limited 5.44 5.14 ICICI Securities Primary Dealership Limited 1.36 1.66 ICICI Home Finance Company Limited 0.16 0.30 ICICI Venture Funds Management Company Limited 0.05 0.10 India Infradebt Limited 0.11 0.11 ICICI Prudential Trust Limited1 0.00 0.00 Total 17.84 20.73 1 0.00 represents insignificant amount. 2 All amounts have been rounded off to the nearest ` 10.0 million. Other income Other income decreased from ` 0.98 billion in fiscal 2023 to ` 0.80 billion in fiscal 2024. Operating expenses The following table sets forth, for the periods indicated, the principal components of operating expenses. ` in billion, except percentages Particulars Fiscal 2023 Fiscal 2024 % change Payments to and provisions for employees 120.60 151.42 25.6 Other administrative expenses 208.13 239.91 15.3 Total operating expenses 328.73 391.33 19.0 1 All amounts have been rounded off to the nearest ` 10.0 million. Operating expenses primarily include employee expenses, depreciation on assets and other administrative expenses. Operating expenses increased by 19.0% from `  328.73 billion in fiscal 2023 to ` 391.33 billion in fiscal 2024. Payments to and provisions for employees Employee expenses increased by 25.6% from `  120.60 billion in fiscal 2023 to `  151.42 billion in fiscal 2024 primarily due to an increase in salary cost, provision for performance bonus and performance-linked retention pay, offset, in part, by a decrease in provision requirement for retirement benefit obligations. Salary cost increased primarily due to annual increments and promotions and an increase in average staff strength (number of employees at March 31, 2023: 129,020 and at March 31, 2024: 141,009). The employee base includes sales executives, employees on fixed term contracts and interns. Other administrative expenses Other administrative expenses primarily include rent, taxes and lighting, advertisements, sales promotion, repairs and maintenance, direct marketing expenses, depreciation, premium paid towards priority sector lending certificates and other expenditure. Other administrative expenses increased by 15.3% from ` 208.13 billion in fiscal 2023 to ` 239.91 billion in fiscal 2024 primarily due to an increase in technology related expenses, reward point expenses, MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 131 Integrated Report Statutory Reports Financial Statements direct marketing agency expenses and advertisement and sales promotion expenses. PROFIT/(LOSS) ON TREASURY-RELATED ACTIVITIES (NET) Gains from treasury-related activities include gains on sale of investments and unrealised profit/(loss) on account of revaluation of investments in the fixed income portfolio, equity and preference share portfolio, units of venture Provisions and contingencies (excluding provisions for tax) decreased from `  66.66 billion in fiscal 2023 to ` 36.43 billion in fiscal 2024 primarily due to a decrease in contingency provision made on a prudent basis and provision for investments, offset, in part, by an increase in provisions for non-performing and other assets and provision for standard assets. Provision for non-performing and other assets was ` 9.45 billion in fiscal 2024 as compared to a write-back of ` 6.23 billion in fiscal 2023. During fiscal 2024, there were higher net additions to non-performing loans primarily in retail and rural loans, offset, in part, by recoveries and upgrades in non-retail loans. During fiscal 2023, there were higher recoveries and upgrades from non-performing assets resulting in net write-back of provision, offset, in part, by an increase in provisioning rate for certain categories of non-performing assets. The provision coverage ratio (excluding cumulative technical/prudential write-offs) on NPAs decreased from 82.8% at March 31, 2023 to 80.3% at March 31, 2024. funds and security receipts issued by asset reconstruction companies. Gain from treasury-related activities was `  0.09 billion in fiscal 2024 as compared to a loss of ` 0.52 billion in fiscal 2023. Treasury income in FY2024 includes transfer of accumulated translation loss of ` 3.40 billion related to closure of Bank’s Offshore Banking Unit, SEEPZ Mumbai, to profit and loss account. Provision for investments decreased from ` 13.00 billion in fiscal 2023 to `  6.89 billion in fiscal 2024. During fiscal 2024, the Bank made a provision of ` 5.41 billion on its investments in Alternate Investment Funds (AIFs) pursuant to RBI guideline dated December 19, 2023 and provision made on equity shares on conversion of loan. During fiscal 2023, the Bank primarily made a provision on equity shares and debentures on conversion of loan and additional provision made on security receipts. Provision for standard assets increased from ` 5.80 billion in fiscal 2023 to ` 11.55 billion in fiscal 2024 primarily due to an increase in domestic loans and upgrade of stage 3 exposure in overseas location to stage 2. The cumulative general provision held at March 31, 2024 was `  58.63 billion (March 31, 2023: ` 47.02 billion). Other provisions and contingencies decreased from ` 54.09 billion in fiscal 2023 to ` 8.54 billion in fiscal 2024. During fiscal 2023, the Bank had made an additional contingency provision ` 56.50 billion on a prudent basis. The Bank held contingency provision of ` 131.00 billion at March 31, 2024. PROVISIONS AND CONTINGENCIES (EXCLUDING PROVISIONS FOR TAX) The following tables set forth, for the periods indicated, the components of provisions and contingencies. ` in billion, except percentages Particulars Fiscal 2023 Fiscal 2024 % change Provision for non-performing and other assets1 (6.23) 9.45 - Provision for investments (including credit substitutes) (net) 13.00 6.89 (47.0) Provision for standard assets 5.80 11.55 99.3 Others2 54.09 8.54 (84.2) Total provisions and contingencies (excluding provision for tax) 66.66 36.43 (45.3) 1 Includes restructuring related provision. 2 Includes nil contingency provision during the year ended March 31, 2024 (March 31, 2023: ` 56.50 billion) 3 All amounts have been rounded off to the nearest ` 10.0 million. MANAGEMENT DISCUSSION & ANALYSIS 132 | Annual Report 2023-24 Total assets of the Bank increased by 18.1% from ` 15,842.07 billion at March 31, 2023 to ` 18,715.15 billion at March 31, 2024, due to a 27.5% increase in investments, a 17.2% increase in cash and cash equivalents and a 16.2% increase in advances. Cash and cash equivalents Cash and cash equivalents include cash in hand and balances with RBI and other banks, including money at call and short notice. Cash and cash equivalents increased by 17.2% from `  1,194.38 billion at March 31, 2023 to `  1,399.26 billion at March 31, 2024 The increase is primarily due to an increase in balance with RBI, money at call & short notice in India, SDF (Standing Deposit Facility) lending to RBI and foreign currency term money lending, TAX EXPENSE The income tax expense increased from ` 105.25 billion in fiscal 2023 to ` 136.00 billion in fiscal 2024. The effective tax rate increased from 24.8% in fiscal 2023 to 25.0% in fiscal 2024 primarily due to change in composition of income. offset, in part, by a decrease in balance with US Federal Reserve and term money lending in India. Investments Total investments increased by 27.5% from `  3,623.30 billion at March 31, 2023 to `  4,619.42 billion at March 31, 2024. Investments in Indian government securities increased from `  3,057.69 billion at March 31, 2023 to ` 3,755.74 billion at March 31, 2024. Other investments increased from `  565.61 billion at March 31, 2023 to `  863.68 billion at March 31, 2024 primarily due to an increase in investment in bonds and debentures, pass through certificates, certificate of deposits and equity investment in I-Process Services (India) Private Limited and ICICI Lombard General Insurance Company Limited. FINANCIAL CONDITION Assets The following table sets forth, at the dates indicated, the principal components of assets. ` in billion, except percentages Assets At March 31, 2023 At March 31, 2024 % change Cash and bank balances 1,194.38 1,399.26 17.2 Investments 3,623.30 4,619.42 27.5 - Government and other approved investments1 3,057.69 3,755.74 22.8 - Equity investment in subsidiaries 69.78 111.32 59.5 - Other investments 495.83 752.36 51.7 Advances (net of BRDS/IBPC)2 10,196.38 11,844.06 16.2 - Domestic 9,855.28 11,509.55 16.8 - Overseas branches 341.10 334.51 (1.9) Fixed assets (including leased assets) 96.00 108.60 13.1 Other assets 732.01 743.81 1.6 - RIDF and other related deposits3 216.22 200.92 (7.1) Total assets 15,842.07 18,715.15 18.1 1 Banks in India are required to maintain a specified percentage, currently 18.00% (at March 31, 2024), of their net demand and time liabilities by way of investments in instruments referred as SLR securities by RBI or liquid assets like cash and gold. 2 Bill Rediscounting Scheme (BRDS)/Interbank Participatory Certificate (IBPC). 3 Deposits made in Rural Infrastructure Development Fund and other related deposits pursuant to shortfall in the amount required to be lent to certain specified sectors called priority sector as per RBI guidelines. 4 All amounts have been rounded off to the nearest ` 10.0 million. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 133 Integrated Report Statutory Reports Financial Statements At March 31, 2024, the Bank had an outstanding net investment of ` 0.29 billion in security receipts issued by asset reconstruction companies as compared to `  2.11 billion at March 31, 2023. Advances Net advances (gross of BRDS/IBPC) increased by 17.3% from ` 10,345.09 billion at March 31, 2023 to ` 12,137.60 billion at March 31, 2024. Net advances (net of BRDS/ IBPC) increased by 16.2% from `  10,196.38 billion at March 31, 2023 to ` 11,844.06 billion at March 31, 2024. Net domestic advances increased by 16.8% from `  9,855.28 billion at March 31, 2023 to `  11,509.55 billion at March 31, 2024 primarily due to an increase in retail advances. Retail advances increased by 19.4% from ` 5,578.17 billion at March 31, 2023 to ` 6,662.61 billion at March 31, 2024. Advances of rural business increased by 17.2% from `  874.31 billion at March 31, 2023 to ` 1,024.46 billion at March 31, 2024. The business banking portfolio increased by 29.3% from ` 721.12 billion at March 31, 2023 to ` 932.28 billion at March 31, 2024. SME advances increased by 24.6% from ` 482.21 billion at March 31, 2023 to ` 600.95 billion at March 31, 2024. The domestic corporate portfolio increased by 10.0% year-on- year. Net advances of overseas branches decreased by 1.9% from ` 341.10 billion at March 31, 2023 to ` 334.51 billion at March 31, 2024. Fixed and other assets Fixed assets (net block) increased by 13.1% from ` 96.00 billion at March 31, 2023 to ` 108.60 billion at March 31, 2024. Other assets increased by 1.6% from ` 732.01 billion at March 31, 2023 to `  743.81 billion at March 31, 2024 primarily due to an increase in interest accrued on loans and investments and margin deposit paid for treasury products, offset, in part, by a decrease in RIDF and other related deposits and mark-to-market on foreign exchange and derivative transactions. The Bank is an active participant in the interest and foreign exchange derivative market. While the positive mark-to-market on such transactions are accounted in ‘Other Assets’, the negative mark-to-market on offsetting transactions are accounted in ‘Other Liabilities’. Liabilities The following table sets forth, at the dates indicated, the principal components of liabilities (including capital and reserves). ` in billion, except percentages Liabilities At March 31, 2023 At March 31, 2024 % change Equity share capital 21.58 28.10 30.2 Reserves 1,985.58 2,355.89 18.6 Deposits 11,808.41 14,128.25 19.6 - Savings deposits 3,797.76 4,023.00 5.9 - Current deposits 1,614.86 1,935.72 19.9 - Term deposits 6,395.79 8,169.53 27.7 Borrowings (excluding subordinated debt) 1,110.44 1,221.18 10.0 - Domestic 852.30 925.46 8.6 - Overseas branches 258.14 295.72 14.6 Subordinated debt (included in Tier-1 and Tier-2 capital) 82.81 28.50 (65.6) Other liabilities 833.25 953.23 14.4 Total liabilities  15,842.07 18,715.15 18.1 1 All amounts have been rounded off to the nearest ` 10.0 million. MANAGEMENT DISCUSSION & ANALYSIS 134 | Annual Report 2023-24 Total liabilities (including capital and reserves) increased by 18.1% from ` 15,842.07 billion at March 31, 2023 to `  18,715.15 billion at March 31, 2024, due to a 19.6% increase in deposits, a 18.8% increase in net worth and a 14.4% increase in other liabilities. Deposits Deposits increased by 19.6% from ` 11,808.41 billion at March 31, 2023 to ` 14,128.25 billion at March 31, 2024. Term deposits increased by 27.7% from ` 6,395.79 billion at March 31, 2023 to `  8,169.53 billion at March 31, 2024. Savings account deposits increased by 5.9% from ` 3,797.76 billion at March 31, 2023 to ` 4,023.00 billion at March 31, 2024 and current account deposits increased by 19.9% from `  1,614.86 billion at March 31, 2023 to `  1,935.72 billion at March 31, 2024. CASA deposits increased by 10.1% from ` 5,412.62 billion at March 31, 2023 to ` 5,958.72 billion at March 31, 2024. The average current account deposits increased by 12.0% from ` 1,324.77 billion in fiscal 2023 to ` 1,483.26 billion in fiscal 2024. The average savings account deposits increased by 4.4% from ` 3,434.14 billion in fiscal 2023 to ` 3,584.21 billion in fiscal 2024. Average CASA deposits increased by 6.5% from ` 4,758.90 billion in fiscal 2023 to `  5,067.47 billion in fiscal 2024. The average CASA deposits were 40.4% of total average deposits for fiscal 2024 as compared to 44.7% for fiscal 2023. Average CASA deposits were 35.9% of the total funding (i.e., deposits and borrowings) for fiscal 2024 as compared to 39.7% for fiscal 2023. Deposits of overseas branches increased by 2.5% from ` 147.82 billion at March 31, 2023 to ` 151.48 billion at March 31, 2024. Total deposits at March 31, 2024 formed 91.9% of the funding (i.e., deposits and borrowings) as compared to 90.8% March 31, 2023. Borrowings Borrowings increased by 4.7% from ` 1,193.25 billion at March 31, 2023 to ` 1,249.68 billion at March 31, 2024 primarily due to an increase in foreign currency term money borrowings, refinance borrowings, call money borrowings in India and bullion borrowings, offset, in part, by a decrease in subordinated bonds. Net borrowings of overseas branches increased from ` 258.14 billion at March 31, 2023 to ` 295.72 billion at March 31, 2024. Other liabilities Other liabilities increased by 14.4% from ` 833.25 billion at March 31, 2023 to ` 953.23 billion at March 31, 2024 primarily due to an increase in total creditors, security deposits and miscellaneous liabilities. The Bank is an active participant in the interest and foreign exchange derivative market. While the positive mark-to-market on such transactions are accounted in ‘Other Assets’, the negative mark-to-market on offsetting transactions are accounted in ‘Other Liabilities’. Equity share capital and reserves Equity share capital and reserves increased by 18.8% from ` 2,007.16 billion at March 31, 2023 to ` 2,383.99 billion at March 31, 2024 primarily due to accretion to reserves out of retained profit, offset, in part, by payment of dividend for fiscal 2023. At March 31, 2024, the Bank’s Tier-1 capital adequacy ratio was 15.60% as against the requirement of 9.70% and total capital adequacy ratio was 16.33% as against the requirement of 11.70%. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 135 Integrated Report Statutory Reports Financial Statements Off balance sheet items, commitments and contingencies The following table sets forth, for the periods indicated, the principal components of contingent liabilities. ` in billion Particulars At March 31, 2023 At March 31, 2024 Claims against the Bank, not acknowledged as debts 81.96 93.29 Liability for partly paid investments 0.01 0.09 Notional principal amount of outstanding forward exchange contracts 15,330.22 15,600.22 Guarantees given on behalf of constituents 1,238.18 1,493.65 Acceptances, endorsements and other obligations 441.91 520.73 Notional principal amount of currency swaps 564.63 541.26 Notional principal amount of interest rate swaps and currency options and interest rate futures 25,089.18 28,197.21 Other items for which the Bank is contingently liable 85.57 111.17 Total 42,831.66 46,557.62 1 All amounts have been rounded off to the nearest ` 10.0 million. The Bank is an active market participant in the interest rate and foreign exchange derivative market for trading and market making purposes, which are carried out primarily for customer transactions and managing the proprietary position on interest rate and foreign exchange risk. The notional amount of interest rate swaps and currency options increased from `  25,089.18 billion at March 31, 2023 to ` 28,197.21 billion at March 31, 2024 primarily due to an increase in market making activities and client flow. The Bank enters into foreign exchange contracts in its normal course of business, to exchange currencies at a prefixed price at a future date. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter- bank market. This results in generation of a higher number of outstanding transactions, and hence a large value of gross notional principal of the portfolio, while the net market risk is lower. The notional principal amount of outstanding forward exchange contracts increased from ` 15,330.22 billion at March 31, 2023 to ` 15,600.22 billion at March 31, 2024 primarily due to an increase in trading and market making activities in forwards to facilitate client flow and capture opportunities in the forward market. Loan concentration The Bank follows a policy of portfolio diversification and evaluates its total financing exposure to a particular industry in the light of its forecasts of growth and profitability for that industry. The Bank’s Credit Risk Management Group monitors all major sectors of the economy and specifically tracks industries in which the Bank has credit exposures. The Bank monitors developments in various sectors to assess potential risks in its portfolio and new business opportunities. The Bank’s policy is to limit its portfolio to any particular industry (other than retail loans) to 15.0% of its total exposure. In addition, the Bank has a framework for managing concentration risk with respect to single borrower and group exposures, based on the internal rating and track record of the borrowers. The exposure limits for lower rated borrowers and groups are substantially lower than the regulatory limits. MANAGEMENT DISCUSSION & ANALYSIS 136 | Annual Report 2023-24 The following tables set forth, at the dates indicated, the composition of the Bank’s exposure. ` in billion, except percentages Industry March 31, 2023 March 31, 2024 Total exposure % of total exposure Total exposure % of total exposure Retail finance1 7,751.65 38.3 9,423.22 39.5 Services – finance 1,766.80 8.7 1,906.17 8.0 Rural retail 1,250.80 6.2 1,508.78 6.3 Wholesale/retail trade 819.20 4.0 1,163.93 4.9 Banks 1,208.52 6.0 1,065.85 4.5 Electronics and engineering 804.99 4.0 958.37 4.0 Services – non-finance 668.24 3.3 850.22 3.6 Crude petroleum/refining and petrochemicals 764.57 3.8 831.65 3.5 Road, ports, telecom, urban development and other infrastructure 609.28 3.0 718.94 3.0 Real estate activities 489.37 2.4 602.10 2.5 Construction 471.72 2.3 549.52 2.3 Iron and steel (including iron and steel products) 446.44 2.2 532.55 2.2 Power 477.22 2.4 530.96 2.2 Chemical and fertilisers 382.83 1.9 421.22 1.8 Automobiles 261.26 1.3 327.64 1.4 Manufacturing products (excluding metal and metal products) 250.49 1.2 319.62 1.3 Textile 220.59 1.1 260.58 1.1 Mutual funds 180.60 0.9 235.92 1.0 Other industries2 1,420.24 7.0 1,632.46 6.9 Total 20,244.81 100.0 23,839.70 100.0 1 Includes home loans, automobile loans, commercial business loans, dealer financing, personal loans, credit cards and loans against securities. 2 Other industries primarily include gems and jewelry, mining, cement, food & beverages, shipping, drugs and pharmaceuticals, metal and metal products (excluding iron and steel) and FMCG. 3 All amounts have been rounded off to the nearest ` 10.0 million. The exposure to the top 20 non-bank borrowers as a percentage of total exposure decreased from 8.5% of total exposure of the Bank at March 31, 2023 to 8.3% at March 31, 2024. All top 20 borrowers as of March 31, 2024 are rated A- and above internally. The exposure to the top 10 borrower groups decreased marginally from 10.1% of total exposure of the Bank at March 31, 2023 to 10.0% at March 31, 2024. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 137 Integrated Report Statutory Reports Financial Statements The following table sets forth, at the dates indicated, the composition of the Bank’s outstanding net advances: ` in billion Particulars March 31, 2023 March 31, 2024 Advances 10,196.38 11,844.06 - Domestic book 9,855.28 11,509.55 - Retail 5,578.17 6,662.61 - Rural 874.31 1,024.46 - Business banking 721.12 932.28 - SME 482.21 600.95 - Corporate and others 2,199.47 2,289.25 - Overseas book 341.10 334.51 1 Net of Bill Rediscounting Scheme (BRDS)/Interbank Participatory Certificate (IBPC). The Bank’s capital allocation framework is focused on growth in granular retail, SME/ business banking and rural lending and lending to the corporate sector with a focus on increase in lending to higher rated corporates. Net retail advances increased by 19.4% in fiscal 2024 compared to an increase of 16.2% in total advances. The share of net retail advances increased from 53.9% of net advances at March 31, 2023 to 54.9% of net advances at March 31, 2024. Including non-fund based outstanding, the share of retail portfolio was 46.8% of the total portfolio at March 31, 2024. The overseas loan portfolio in USD terms declined by 3.4% year-on-year at March 31, 2024. The year-on-year decrease in the overseas loan portfolio was primarily on account of repayment of short-term trade advances. The overseas loan portfolio was 2.8% of the overall loan book at March 31, 2024. The corporate fund and non- fund outstanding, net of cash/bank/financial institutions/ insurance backed lending, was USD 3.11 billion at March 31, 2024. Out of USD 3.11 billion, 91.2% of the outstanding was to Indian corporates and their subsidiaries and joint ventures and 5.7% of the outstanding was to non-India companies with Indian or India-linked operations and activities. The portfolio in this segment is primarily to well-rated companies and the Indian operations of these companies are target customers for the Bank’s deposit and transaction banking franchise. The Bank would continue to pursue risk-calibrated opportunities in this segment. The non-India linked corporate portfolio reduced by 10.1% from about USD 305.6 million year-on-year to USD 274.9 million at March 31, 2024. The following table sets forth, at the dates indicated, the composition of the Bank’s net outstanding retail advances. ` in billion, except percentages March 31, 2023 March 31, 2024 Total retail advances % of total retail advances Total retail advances % of total retail advances Home loans 3,446.96 61.8 3,959.21 59.4 Personal loans 880.55 15.8 1,166.77 17.5 Automobile loans 518.78 9.3 612.09 9.2 Credit cards 378.41 6.8 513.21 7.7 Commercial business 275.41 4.9 314.26 4.7 Others1 78.06 1.4 97.07 1.5 Total retail advances2 5,578.17 100.0 6,662.61 100.0 1 Includes loans against securities and dealer financing. 2 Gross of Bill Rediscounting Scheme (BRDS)/Interbank Participatory Certificate (IBPC) amounting to ` 82.5 billion at March 31, 2023 and ` 150.0 billion at March 31, 2024. 3 All amounts have been rounded off to the nearest ` 10.0 million. MANAGEMENT DISCUSSION & ANALYSIS 138 | Annual Report 2023-24 The following table sets forth, at the dated indicated, the composition of the Bank’s net outstanding rural advances: ` in billion Particulars March 31, 2023 March 31, 2024 Farmer finance 234.05 266.53 Rural business credit 239.10 278.98 Jewel loan 228.86 271.53 Others1 172.30 207.42 Rural advances 874.31 1,024.46 1 Includes term loans for farm equipment, self-help groups, loans to microfinance institutions for on-lending to individuals and inventory funding. The following table sets forth, at the dates indicated, the rating wise categorisation of the Bank’s net outstanding advances other than retail and rural advances: ` in billion, except percentages Ratings category1 March 31, 2023 March 31, 2024 AA- and above 46.9% 39.8% A+, A, A- 26.6 27.9 A- and above 73.5 67.7 BBB+, BBB, BBB- 24.3 30.5 BB and below2 1.2 1.1 Unrated 1.0 0.7 Total 100.0% 100.0% Total net advances3 ` 3,826.41 ` 4,306.99 1 Based on internal ratings. 2 Includes net non-performing loans. 3 Includes business banking, SME, domestic, corporate and overseas loans. Directed Lending The following table sets forth, for the periods indicated, ICICI Bank’s average priority sector lending: Particulars Fiscal 2023 Fiscal 2024 Amount (` billions) % of adjusted net bank credit Amount (` billions) % of adjusted net bank credit Target (% of adjusted net bank credit) Agriculture Sector 1,423.58 17.7 1,739.94 18.1 18.0 - Small and marginal farmers 794.72 9.9 1,041.44 10.8 10.0 - Non-corporate farmers 1,068.17 13.3 1,378.20 14.4 13.8 Micro, small and medium enterprises 1,729.04 - 2,100.03 - - - Micro enterprises 661.21 8.2 792.71 8.3 7.5 Other priority sector 178.32 - 102.29 - - Total priority sector lending 3,330.94 41.5 3,942.26 41.1 40.0 - Weaker sections 910.20 11.3 1,157.15 12.1 12.0 1 The above includes the impact of Priority Sector Lending Certificate purchased/sold by the Bank. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 139 Integrated Report Statutory Reports Financial Statements Classification of loans The following table sets forth, at the dates indicated, information regarding asset classification of the Bank’s gross non- performing assets (net of write-offs, interest suspense and derivative income reversals). ` in billion Particulars March 31, 2023 March 31, 2024 Non-performing assets Sub-standard assets 68.79 87.13 Doubtful assets 127.00 96.04 Loss assets 116.05 96.45 Total non-performing assets1 311.84 279.62 1 Include advances, lease receivables and credit substitutes like debentures and bonds. Excludes preference shares. 2 All amounts have been rounded off to the nearest ` 10.0 million. The following table sets forth, at the dates indicated, information regarding the Bank’s non-performing assets (NPAs). ` in billion, except percentages Year ended Gross NPA1 Net NPA Net customer assets % of net NPA to net customer assets2 March 31, 2021 413.73 91.80 8,025.90 1.14 March 31, 2022 339.20 69.61 9,160.87 0.76 March 31, 2023 311.84 51.55 10,816.41 0.48 March 31, 2024 279.62 53.78 12,720.24 0.42 1 Net of write-offs, interest suspense and derivatives income reversal. 2 Include advances, lease receivables and credit substitutes like debentures and bonds. Excludes preference shares. 3 All amounts have been rounded off to the nearest ` 10.0 million. The following table sets forth, for the periods indicated, the composition of gross non-performing assets (net of write- offs) by industry sector. ` in billion, except percentages March 31, 2023 March 31, 2024 Amount % Amount % Retail finance1 71.79 23.0 82.89 29.6 Rural retail 37.29 12.0 42.55 15.2 Construction 54.21 17.4 41.13 14.7 Crude petroleum/refining and petrochemicals 26.84 8.6 16.88 6.0 Services – non-finance 15.37 4.9 14.79 5.3 Electronics and engineering 12.52 4.0 12.40 4.4 Mining 11.78 3.8 11.96 4.3 Road, ports, telecom, urban development and other infrastructure 13.75 4.4 9.76 3.5 Wholesale/retail trade 7.77 2.5 8.56 3.1 Iron/steel and products 5.48 1.8 4.90 1.8 Power 21.91 7.0 4.44 1.6 Gems and jewellery 3.19 1.0 2.74 1.0 Manufacturing products 3.53 1.1 0.90 0.3 Other industries2 26.41 8.5 25.72 9.2 Total 311.84 100.0 279.62 100.0 1 Includes home loans, automobile loans, commercial business loans, dealer financing, personal loans, credit cards and loans against securities. 2 Other industries primarily include textile, metal and metal products, shipping, food and beverages, chemical and fertilizers, services- finance, cement, drugs and pharmaceuticals, FMCG, automobiles and developer financing. 3 All amounts have been rounded off to the nearest ` 10.0 million. MANAGEMENT DISCUSSION & ANALYSIS 140 | Annual Report 2023-24 The gross additions to NPAs were ` 190.27 billion in fiscal 2024 (` 186.41 billion in fiscal 2023). The net additions to NPAs were ` 34.04 billion in fiscal 2024 (` 20.38 billion in fiscal 2023). In fiscal 2024, the Bank recovered/upgraded non-performing assets amounting to `  156.23 billion (` 166.03 billion in fiscal 2023), wrote-off non-performing assets amounting to `  60.92 billion (`  44.66 billion in fiscal 2023) and sold non-performing assets amounting to ` 5.35 billion (` 3.08 billion in fiscal 2023). As a result, gross NPAs (net of write-offs) of the Bank decreased from ` 311.84 billion at March 31, 2023 to ` 279.62 billion at March 31, 2024. Net NPAs increased from `  51.55 billion at March 31, 2023 to ` 53.78 billion at March 31, 2024. The ratio of net NPAs to net customer assets decreased from 0.48% at March 31, 2023 to 0.42% at March 31, 2024. The provision coverage ratio at March 31, 2024 was 80.3% as compared to 82.8% at March 31, 2023. At March 31, 2024, gross non-performing loans in the retail portfolio were 1.23% of gross retail loans compared to 1.28% at March 31, 2023 and net non-performing loans in the retail portfolio were 0.47% of net retail loans compared to 0.47% at March 31, 2023. The total non-fund based outstanding to borrowers classified as non-performing was `  36.71 billion at March 31, 2024 (March 31, 2023: `  37.80 billion). The Bank held a provision of ` 20.90 billion at March 31, 2024 (March 31, 2023: ` 20.05 billion) against these non-fund based outstanding. The gross outstanding loans to borrowers whose facilities have been restructured decreased from ` 45.08 billion at March 31, 2023 to ` 30.59 billion at March 31, 2024. The net outstanding loans to borrowers whose facilities have been restructured decreased from ` 43.30 billion at March 31, 2023 to ` 29.15 billion at March 31, 2024. The aggregate non-fund based outstanding to borrowers whose loans were restructured was `  2.48 billion at March 31, 2024 (March 31, 2023: ` 3.32 billion). Additionally, Bank holds provision of ` 8.31 billion on restructured accounts. At March 31, 2024, the outstanding loans and non-fund facilities to borrowers in the corporate and small and medium enterprises portfolio rated BB and below were `  55.28 billion which includes the outstanding loans and non-funded facilities under resolution amounting to ` 6.45 billion. For a discussion on accounting policy for classification on loans, see “Financial Statement (Schedule 17- Significant Accounting Policies) – Provision/write-offs on loans and other credit facilities”. SEGMENT INFORMATION RBI in its guidelines on "segmental reporting” has stipulated specified business segments and their definitions, for the purpose of public disclosures on business information for banks in India. The business segments as defined by RBI for standalone segmental report are Retail Banking, Wholesale Banking, Treasury and Other Banking. Additionally, Unallocated includes items such as income tax paid in advance net of provision for tax, deferred tax and provisions to the extent reckoned at entity level. Framework for transfer pricing All liabilities are transfer priced to a central treasury unit, which pools all funds and lends to the business units at appropriate rates based on the relevant maturity of assets being funded after adjusting for regulatory reserve requirement and directed lending requirements. Retail banking segment The profit before tax of the segment increased from ` 175.34 billion in fiscal 2023 to ` 188.49 billion in fiscal 2024 primarily due to an increase in net interest income and non-interest income, offset, in part, by an increase in operating expenses and provisions. Wholesale banking segment The profit before tax of the segment increased from `  157.85 billion in fiscal 2023 to `  199.72 billion in fiscal 2024 primarily due to an increase in net interest income, non-interest income and higher recoveries on non-performing loans, offset, in part, by an increase in operating expenses. Treasury segment The profit before tax of the segment increased from ` 142.72 billion in fiscal 2023 to ` 148.99 billion in fiscal 2024 primarily due to an increase in net interest income and non-interest income, offset, in part, by an increase in operating expenses and provisions. Other banking segment Profit before tax of the other banking segment increased from `  4.80 billion in fiscal 2023 to `  7.68 billion in fiscal 2024. Unallocated During FY2023, the Bank had made an additional contingency provision ` 56.50 billion on a prudent basis as compared to a nil contingency provision during FY2024. The contingency provision was not allocated to any segment and included in unallocated. MANAGEMENT DISCUSSION & ANALYSIS Annual Report 2023-24 | 141 Integrated Report Statutory Reports Financial Statements CONSOLIDATED FINANCIALS AS PER INDIAN GAAP The consolidated profit after tax increased from ` 340.37 billion in fiscal 2023 to `  442.56 billion in fiscal 2024 primarily due to an increase in the profit of ICICI Bank and subsidiaries namely ICICI Securities, ICICI Prudential Asset Management Company, ICICI Securities Primary Dealership, ICICI Home Finance Company, ICICI Bank Canada, ICICI Bank UK, ICICI Lombard General Insurance Company (ICICI General) and ICICI Prudential Life Insurance Company. The consolidated assets of the Bank and its subsidiaries and other consolidating entities increased from ` 19,584.90 billion at March 31, 2023 to ` 23,640.63 billion at March 31, 2024. Consolidated advances increased from ` 10,838.66 billion at March 31, 2023 to ` 12,607.76 billion at March 31, 2024. At March 31, 2024, the Bank’s consolidated Tier-1 capital adequacy ratio was 15.43% as against the requirement of 9.70% and consolidated total capital adequacy ratio was 16.14% as against the requirement of 11.70%. During fiscal 2024, the Board of Directors of the Bank approved to increase shareholding in ICICI General in multiple tranches up to 4.0% additional shareholding and make the Company, a subsidiary of the Bank. Post necessary regulatory approval(s), the Bank through stock exchange mechanism had acquired additional stake in ICICI General in multiple tranches, resulting into an increase in shareholding to more than 50.0%. Consequently, ICICI General ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. During fiscal 2024, the Board of Directors of the Bank approved to make I-Process Services (India) Private Limited (I-Process) a wholly-owned subsidiary of the Bank. Post necessary regulatory approval(s), the Bank entered into a share purchase agreement in relation to investment in equity shares of I-Process from off-market transactions. Consequently, I-Process ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and subsequently became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. ICICI Bank Canada The core operating profit of ICICI Bank Canada increased from CAD 61.2 million in fiscal 2023 to CAD 100.9 million in fiscal 2024 primarily due to an increase in net interest income and fee income, offset, in part, by an increase in operating expenses. The profit after tax of ICICI Bank Canada increased from CAD 46.4 million (` 2.82 billion) in fiscal 2023 to CAD 73.3 million (` 4.50 billion) in fiscal 2024 primarily due to an increase in core operating profit. The total assets decreased from CAD 5.98 billion at March 31, 2023 to CAD 5.88 billion at March 31, 2024. Loans and advances increased from CAD 5.17 billion at March 31, 2023 to CAD 5.23 billion at March 31, 2024. The net impairment ratio increased from 0.08% at March 31, 2023 to 0.24% at March 31, 2024 primarily due to change in estimates and revision in macro-economic factors. ICICI Bank Canada had a total capital adequacy ratio of 17.8% at March 31, 2024 as compared to 17.3% at March 31, 2023. ICICI Bank UK The core operating profit of ICICI Bank UK increased from USD 18.3 million in fiscal 2023 to USD 34.5 million in fiscal 2024 primarily due to an increase in net interest income and fee income, offset, in part, by an increase in operating expenses. Profit after tax of ICICI Bank UK increased from USD 13.0 million (` 1.05 billion) in fiscal 2023 to USD 28.8 million (` 2.39 billion) in fiscal 2024 primarily due to higher core operating profit, offset, in part, by an increase in impairment provisions. Total assets increased from USD 2.14 billion at March 31, 2023 to USD 2.21 billion at March 31, 2024. Net advances increased from USD 0.99 billion at March 31, 2023 to USD 1.04 billion at March 31, 2024. The net impairment ratio decreased from 3.3% at March 31, 2023 to 1.1% at March 31, 2024. ICICI Bank UK had a total capital adequacy ratio of 23.3% at March 31, 2024 compared to 27.1% at March 31, 2023. ICICI Prudential Life Insurance Company (ICICI Life) The Annualised Premium Equivalent of ICICI Life increased by 4.7% from `  86.40 billion for fiscal 2023 to `  90.46 billion for fiscal 2024. The Value of New Business (VNB) decreased by 19.5% from ` 27.65 billion for fiscal 2023 to ` 22.27 billion for fiscal 2024. The VNB margin decreased from 32.0% for fiscal 2023 to 24.6% in fiscal 2024. The total premium earned increased by 8.3% from ` 399.33 billion in fiscal 2023 to `  432.36 billion in fiscal 2024. The total assets under management increased from ` 2,511.91 billion at March 31, 2023 to ` 2,941.40 billion at March 31, 2024. Net premium earned increased by 8.3% from `  385.60 billion in fiscal 2023 to ` 417.60 billion in fiscal 2024. The profit after tax increased from ` 8.11 billion in fiscal 2023 to ` 8.52 billion in fiscal 2024 primarily due to an increase in investment income in the shareholder segment due to favourable market conditions, offset, in part, by higher new business strain in annuity and non-participating protection segments. MANAGEMENT DISCUSSION & ANALYSIS 142 | Annual Report 2023-24 ICICI Lombard General Insurance Company (ICICI General) The Gross Domestic Premium Income of ICICI General increased by 17.8% year-on-year from `  210.25 billion in fiscal 2023 to ` 247.76 billion in fiscal 2024. The profit after tax increased from ` 17.29 billion in fiscal 2023 to ` 19.19 billion in fiscal 2024 primarily due to an increase in premium income and reversal of tax provision, offset, in part, by an increase in claims and benefits paid. ICICI Prudential Asset Management Company (ICICI AMC) As per Indian GAAP, the profit after tax of ICICI AMC increased from ` 15.08 billion in fiscal 2023 to ` 18.15 billion in fiscal 2024 primarily due to an increase in fee income, offset, in part, by an increase in operating expenses. ICICI Securities As per Indian GAAP, the consolidated profit after tax of ICICI Securities increased from ` 11.40 billion in fiscal 2023 to ` 17.33 billion in fiscal 2024 primarily due to an increase in fee income and net interest income, offset, in part, by an increase in staff cost and other administrative expenses. ICICI Securities Primary Dealership (I-Sec PD) As per Indian GAAP, the profit after tax of I-Sec PD increased from ` 1.28 billion in fiscal 2023 to ` 4.14 billion in fiscal 2024 primarily due to an increase in net interest income and higher trading gains. ICICI Home Finance Company Limited (ICICI HFC) As per Indian GAAP, profit after tax increased from ` 3.65 billion in fiscal 2023 to ` 5.32 billion in fiscal 2024 primarily due to an increase in core operating profit and release in provisions. The core operating profit increased primarily due to an increase in net interest income and fee income, offset, in part, by an increase in operating expenses. Provision decreased from a charge of `  0.56 billion in fiscal 2023 to a write back of ` 0.10 billion in fiscal 2024 primarily due to recovery. Net NPAs decreased from ` 3.53 billion at March 31, 2023 to ` 2.88 billion at March 31, 2024. ICICI Venture Funds Management Company (ICICI Venture) The profit after tax of ICICI Venture increased from ` 61.9 million in fiscal 2023 to `  110.3 million in fiscal 2024 primarily due to an increase in management fees received from launch of new funds, offset, in part, by an increase in operating expenses. The following table sets forth, for the periods and at the dates indicated, the profit/(loss) and total assets of our principal subsidiaries as per Indian GAAP. ` in billion Company Profit after tax Total assets1 Fiscal 2023 Fiscal 2024 At March 31, 2023 At March 31, 2024 ICICI Bank Canada 2.82 4.50 363.46 361.00 ICICI Bank UK PLC 1.05 2.39 176.13 184.10 ICICI Prudential Life Insurance Company Limited 8.11 8.52 2,558.47 2,990.00 ICICI Lombard General Insurance Company Limited2 17.29 19.19 550.863 633.08 ICICI Prudential Asset Management Company Limited 15.08 18.15 24.89 29.18 ICICI Securities Limited (consolidated) 11.40 17.33 154.71 253.65 ICICI Securities Primary Dealership Limited 1.28 4.14 344.01 357.43 ICICI Home Finance Company Limited 3.65 5.32 187.01 235.82 ICICI Venture Funds Management Company Limited 0.06 0.11 3.02 3.08 1 Total assets are as per classification used in the consolidated financial statements and hence the total assets as per subsidiary’s financial statements may differ. 2 Entity ceased to be an accounted as per the equity method as prescribed by Accounting Standard – 23 – “Accounting for Investments in Associates in Consolidated Financial Statements” and became subsidiary of Bank w.e.f. February 29, 2024 and consolidated as per Accounting Standard-21- “Consolidated Financial Statements”. 3 Total assets as per financial statements of ICICI Lombard General Insurance Company Limited. 4 See also “Financials- Statement pursuant to Section 129 of the Companies Act, 2013”. 5 All amounts have been rounded off to the nearest ` 10.0 million. Annual Report 2023-24 | 143 Integrated Report Statutory Reports Financial Statements KEY FINANCIAL INDICATORS: LAST 10 YEARS (` in billion, except per share data and percentages) 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Total deposits 3,615.63 4,214.26 4,900.39 5,609.75 6,529.20 7,709.69 9,325.22 10,645.72 11,808.41 14,128.25 Total advances 3,875.22 4,352.64 4,642.32 5,123.95 5,866.47 6,452.90 7,337.29 8,590.20 10,196.38 11,844.06 Equity capital & reserves 804.29 897.36 999.51 1,051.59 1,083.68 1,165.04 1,475.09 1,705.12 2,007.15 2,383.99 Total assets 6,461.29 7,206.95 7,717.91 8,791.89 9,644.59 10,983.65 12,304.33 14,112.98 15,842.07 18,715.15 Total capital adequacy ratio1 17.0% 16.6% 17.4% 18.4% 16.9% 16.1% 19.1% 19.2% 18.3% 16.3% Core operating profit 180.27 198.03 179.10 189.39 220.72 268.08 313.51 383.47 491.39 581.22 Net interest income 190.40 212.24 217.37 230.26 270.15 332.67 389.89 474.66 621.29 743.06 Net interest margin 3.48% 3.49% 3.25% 3.23% 3.42% 3.73% 3.69% 3.96% 4.48% 4.53% Profit after tax 111.75 97.26 98.01 67.77 33.63 79.31 161.93 233.39 318.96 408.88 Earnings per share (Basic)2 17.56 15.23 15.31 10.56 5.23 12.28 24.01 33.66 45.79 58.38 Earnings per share (Diluted)2 17.39 15.14 15.25 10.46 5.17 12.08 23.67 32.98 44.89 57.33 Return on average equity 14.3% 11.3% 10.3% 6.6% 3.2% 7.1% 12.2% 14.8% 17.3% 18.7% Dividend per share3 5.00 5.00 2.50 1.50 1.00 0.00 2.00 5.00 8.00 10.00 1 Total capital adequacy ratio has been calculated as per Basel III framework. 2 During the year ended March 31, 2018, the Bank issued bonus shares in the proportion of 1:10, i.e. 1 (One) bonus equity share of ` 2 each for every 10 (Ten) fully paid-up equity shares held (including shares underlying ADS). Per share information of prior periods also reflects the effect of bonus issue. 3 RBI through its circular 'Declaration of dividends by banks (Revised)' dated April 17, 2020, had directed that banks shall not make any dividend payment on equity shares from the profits pertaining to the financial year ended March 31, 2020. Accordingly, the Bank did not pay any dividend for FY2020. 144 | Annual Report 2023-24 INDEPENDENT AUDITOR’S REPORT To the Members of ICICI Bank Limited Report on the Audit of the Standalone Financial Statements Opinion 1. We have audited the accompanying standalone financial statements of ICICI Bank Limited (‘the Bank’), which comprise the Standalone Balance Sheet as at 31 March 2024, the Standalone Profit and Loss Account, and Standalone Cash Flow Statement for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information (‘the standalone financial statements’). 2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Banking Regulation Act, 1949 as well as the Companies Act, 2013 (‘the Act’) and circulars and guidelines issued by the Reserve Bank of India (‘RBI’) from time to time (‘RBI Guidelines’) in the manner so required for Banking companies and give a true and fair view in conformity with the Accounting Standards prescribed under section 133 of the Act read with the Companies (Accounting Standards) Rules, 2021 and other accounting principles generally accepted in India, of the state of affairs of the Bank as at 31 March 2024, and its profit, and its cash flows for the year ended on that date. Basis for Opinion 3. We conducted our audit in accordance with the Standards on Auditing (‘SAs’) specified under section 143(10) of the Act. Our responsibilities under those SAs are further described in the ‘Auditor’s Responsibilities for the Audit of the Standalone Financial Statements’ section of our report. We are independent of the Bank in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (‘ICAI’) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters 4. Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone financial statements of the current year. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. 5. We have determined the matters described below to be the key audit matters to be communicated in our report. Key Audit Matter How our audit addressed the key audit matters Identification and provisioning of non-performing advances (NPA): Total Loans and Advances (Net of Provision) as at 31 March 2024: ` 11,844,063,894 (in ‘000s) Provision for NPA as at 31 March 2024: ` 219,358,846 (in ‘000s) (Refer Schedule 9, Schedule 17(3) and Schedule 18(18)) The Reserve Bank of India’s (“RBI”) guidelines on Income recognition and asset classification & Provisioning (“IRAC”) and other circulars and directives issued by the RBI from time to time, which prescribe the prudential norms for identification and classification of performing & non-performing assets (“NPA”) and the minimum provision required for such assets. The Bank is required Our audit procedures with respect to this matter included: Tested the design and operating effectiveness of key controls over approval, recording, monitoring and recovery of loans, monitoring overdue / stressed accounts, identification of NPA, provision for NPA and valuation of security and collateral on a test check basis. Annual Report 2023-24 | 145 Integrated Report Statutory Reports Financial Statements Key Audit Matter How our audit addressed the key audit matters to have Board approved policy as per IRAC guidelines for NPA identification & classification of advances and provision thereon. The provision on NPA is estimated based on ageing and classification of NPAs, recovery estimates, nature of loan product, value of security and other qualitative factors and is subject to the minimum provisioning norms specified by RBI and approved policy of the Bank in this regard. The Bank is also required to apply its judgement to determine the identification and provision required against NPAs by applying quantitative as well as qualitative factors. The risk of identification of NPAs is affected by factors like stress and liquidity concerns in certain sectors. Additionally, the Bank makes provisions on exposures that are not classified as NPA including advances to certain sectors and identified advances or group advances. These are classified as contingency provisions. Since the identification of NPAs and provisioning for advances require significant level of estimation and given its significance to the overall audit including possible observation by RBI which could result into disclosure in the financial statements, we have ascertained identification and provisioning for NPAs as a key audit matter. Further obtained an understanding of the contingency provision carried by the Bank and verified the underlying assumptions used by the Bank for such estimate. Tested application controls included test of automated controls, reports and system reconciliations. Reviewed existence and effectiveness of monitoring mechanisms such as Internal Audit, Systems Audit, and Concurrent Audit as per the policies and procedures of the Bank; Evaluated the governance process and review controls over calculations of provision of non-performing advances, basis of provisioning in accordance with the Board approved policy. Selected a sample of borrowers based on quantitative and qualitative risk factors for their assessment of appropriate identification & classification as NPA including computation of overdue ageing to assess its correct classification and provision amount as per extant IRAC norms and the Bank policy. Performed other substantive procedures included and not limited to the following:  Selected samples of performing loans and assessed independently as to whether those should be classified as NPA;  For samples selected, reviewed the collateral valuations, financial statements and other qualitative information  Considered the accounts reported by the Bank and other Banks as Special Mention Accounts (“SMA”) in RBI’s Central Repository of Information on Large Credits (CRILC)/ Centralised Information Management System (CIMS) to identify stress.  For selected samples, assessed independently, the accounts that can potentially be classified as NPA.  Inquired with the credit and risk departments to ascertain if there were indicators of stress or an occurrence of an event of default in a particular loan account or any product category which needed to be considered as NPA.  Examined the accounts under watchlist report provided by the risk department. INDEPENDENT AUDITOR’S REPORT (Contd.) 146 | Annual Report 2023-24 Key Audit Matter How our audit addressed the key audit matters  Discussed with the management of the Bank on sectors where there is a perceived credit risk and the steps taken to mitigate the risks to identified sectors.  Selected and tested samples for accounts which are restructured as per RBI Master Circular - Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances; and  Assessed appropriateness & the adequacy of disclosures against the relevant accounting standards and RBI requirements relating to NPAs. Evaluation of Litigations included in contingent liabilities. (Included under contingent liabilities) (in ‘000) Particulars As at 31 March 2024 As at 31 March 2023 Legal Cases 3,829,177 3,027,295 Taxes 89,463,903 78,935,723 Total Claims against Bank not acknowledged as Debt 93,293,080 81,963,018 (Refer Schedule 12 I, Schedule 17(12) and Schedule 18(37)) The Bank has material open tax litigations including matters under dispute which involve significant judgement to determine the possible outcome of these disputes. Significant management judgement is needed in determining whether an obligation exists and whether a provision should be recognised as at the reporting date, in accordance with the accounting criteria set under Accounting Standard 29 - Provisions, Contingent Liabilities and Contingent Assets (‘AS 29’), or whether it needs to be disclosed as a contingent liability. Further, significant judgements are also involved in measuring such obligations, the most significant of which are:  Assessment of Liability: Judgement is involved in determination of whether outflow in respect of identified material matters are probable and can be estimated reliably.  Adequacy of provisions: The appropriateness of assumption and judgements used in estimation of significant provisions; and  Adequacy of disclosures of provision for liabilities and charges, and contingent liabilities. The Bank’s assessment is supported by the facts of matter, their own judgement, experience, and advises from legal and independent tax consultants wherever considered necessary. Our Audit procedures with respect to this matter included: Tested the design and operating effectiveness of the Bank’s key controls over the estimation, monitoring and disclosure of provisions and contingent liabilities on test check basis. Our substantive audit procedures included and were not limited to the following:  Obtained an understanding of Bank’s process for determining tax liabilities, tax provisions and contingent liabilities pertaining to legal and taxation matters;  Obtained a list of cases /matters in respect of which the litigations were outstanding as at reporting date: • For significant legal matters, we obtained external confirmations and corroborated with management’s documented conclusions on the assessment of outstanding litigations against the Bank; • For significant taxation matters, we involved our tax specialists to gain an understanding of status of the litigations including understanding of various orders/ notices received by the Bank and management’s grounds of appeals before the relevant appellate authorities. INDEPENDENT AUDITOR’S REPORT (Contd.) Annual Report 2023-24 | 147 Integrated Report Statutory Reports Financial Statements Key Audit Matter How our audit addressed the key audit matters Since the assessment of these open litigations requires significant level of judgement in interpretation of law, we have included this as a key audit matter.  Evaluated the merit of the subject matter under consideration with reference to the grounds presented therein and available independent legal / tax advice;  Inquired with appropriate level of the management including status update, expectation of outcomes with the basis, and the future course of action contemplated by the Bank;  Reviewed minutes of meetings with Board, and Audit committee in this regard  Agreed underlying tax balances to supporting documentation including correspondence with the Tax authorities; and  Assessed the appropriateness & adequacy of disclosures within the standalone financial statements in accordance with the applicable accounting standards and requirements of RBI in this regard. Information Technology (‘IT’) systems and controls impacting financial controls. The Bank has a complex IT architecture to support its day-to-day business operations. High volume of transactions are processed and recorded on single or multiple applications. The reliability and security of IT systems plays a key role in the business operations of the Bank. Since large volume of transactions are processed daily, the IT controls are required to ensure that applications process data as expected and that changes are made in an appropriate manner. Appropriate IT general controls and application controls are required to ensure that such IT systems are able to process the data, as required, completely, accurately and consistently for reliable financial reporting. We have identified ‘IT systems and controls’ as key audit matter because of the high level automation, significant number of systems being used by the management and the complexity of the IT architecture and its impact on the financial reporting system. Our Audit procedures with respect to this matter included: For testing the IT general controls, application controls and IT dependent manual controls, we involved IT specialists as part of the audit. The team also assisted in testing the accuracy of the information produced by the Bank’s IT systems. Obtained a comprehensive understanding of IT applications landscape implemented at the Bank. It was followed by process understanding, mapping of applications to the same and understanding financial risks posed by people-process and technology. Key IT audit procedures includes testing design and operating effectiveness of key controls operating over user access management (which includes user access provisioning, de-provisioning, access review, password configuration review, segregation of duties and privilege access), change management (which include change release in production environment are compliant to the defined procedures and segregation of environment is ensured), program development (which include review of data migration activity), computer operations (which includes testing of key controls pertaining to, backup, batch processing (including interface testing), incident management and data centre security), system interface controls. This included testing that requests for access to systems were appropriately logged, reviewed, and authorized. INDEPENDENT AUDITOR’S REPORT (Contd.) 148 | Annual Report 2023-24 Key Audit Matter How our audit addressed the key audit matters In addition to the above, the design and operating effectiveness of certain automated controls, that were considered as key internal system controls over financial reporting were tested. Using various techniques such as inquiry, review of documentation / record / reports, observation, and re-performance. We also tested few controls using negative testing technique. Tested compensating controls and performed alternate procedures, where necessary. In addition, understood where relevant changes made to the IT landscape during the audit period. Information Other than the Standalone Financial Statements and Auditor’s Report Thereon 6. The Bank’s Board of Directors are responsible for the other information. The other information comprises the information included in the Annual Report but does not include the standalone financial statements and our auditor’s report thereon. The Annual Report is expected to be made available to us after the date of this auditor’s report. Our opinion on the standalone financial statements does not cover the other information and we will not express any form of assurance conclusion thereon. In connection with our audit of the standalone financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements, or knowledge obtained in the audit, or otherwise appears to be materially misstated. When we read the Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and take appropriate action as applicable under the relevant laws and regulations. Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements 7. The Bank’s Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance, and cash flows of the Bank in accordance with accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act, read with the Companies (Accounting Standards) Rules, 2021, and provisions of Section 29 of the Banking Regulation Act, 1949 and circulars and guidelines issued by the RBI from time to time (‘RBI Guidelines’). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act and the RBI Guidelines for safeguarding of the assets of the Bank and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error. 8. In preparing the standalone financial statements, Board of Directors are responsible for assessing the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intend to liquidate the Bank or to cease operations, or has no realistic alternative but to do so. INDEPENDENT AUDITOR’S REPORT (Contd.) Annual Report 2023-24 | 149 Integrated Report Statutory Reports Financial Statements INDEPENDENT AUDITOR’S REPORT (Contd.) 9. The Board of Directors are also responsible for overseeing the Bank’s financial reporting process. Auditor’s Responsibilities for the Audit of the Standalone Financial Statements 10. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements. 11. As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional skepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control; • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Bank has adequate internal financial controls with reference to standalone financial statements in place and the operating effectiveness of such controls; • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Management; • Conclude on the appropriateness of the Management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Bank to cease to continue as a going concern; • Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation. 12. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. 13. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. 14. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current year, and are therefore, the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. 150 | Annual Report 2023-24 INDEPENDENT AUDITOR’S REPORT (Contd.) Report on Other Legal and Regulatory Requirements 15. The Balance Sheet and the Profit and Loss Account have been drawn up in accordance with the provisions of Section 29 of the Banking Regulation Act, 1949 and Section 133 of the Act and the relevant rules issued thereunder. 16. As required by sub-section (3) of section 30 of the Banking Regulation Act, 1949, we report that: a. We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purpose of our audit and have found them to be satisfactory; b. The transactions of the Bank, which have come to our notice, have been within the powers of the Bank. c. Since the key operations of the Bank are automated with the key applications integrated to the core banking system, the audit is carried out centrally as all the necessary records and data required for the purposes of our audit are available therein. We have visited 165 branches to examine the records maintained at the branches for the purpose of our audit. 17. As required by Section 143(3) of the Act, we report that: a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; b. In our opinion, proper books of account as required by law have been kept by the Bank so far as it appears from our examination of those books; c. The Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this Report are in agreement with the books of account; d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act read with relevant rules issued thereunder, to the extent they are not inconsistent with the accounting policies prescribed by the RBI; e. On the basis of the written representations received from the directors as on 31 March 2024 taken on record by the Board of Directors, none of the directors are disqualified as on 31 March 2024 from being appointed as a director in terms of Section 164(2) of the Act; f. With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Bank and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”; and g. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanations given to us: i. The Bank has disclosed the impact of pending litigations on its financial position in its standalone financial statements (Refer Schedule 12, Schedule 17(12) and Schedule 18(42)); ii. The Bank has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts ((Refer Schedule 17(12) and Schedule 18(42)); iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Bank during the year ended 31 March 2024; iv. (1) The Management has represented that, to the best of its knowledge and belief, as disclosed in schedule 18(59) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank to or in any other person(s) or entity(ies), including foreign entities (‘Intermediaries’), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on Annual Report 2023-24 | 151 Integrated Report Statutory Reports Financial Statements INDEPENDENT AUDITOR’S REPORT (Contd.) behalf of the Bank (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; (2) The Management has represented that, to the best of it’s knowledge and belief, as disclosed in schedule 18(59) to the standalone financial statements, no funds have been received by the Bank from any person(s)/entity(ies), including foreign entities (“Funding Parties”), that the Bank has directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and (3) Based on such audit procedures performed, as considered reasonable and appropriate in the circumstances, nothing has come to our attention that causes us to believe that the management representations under sub-clauses (1) and (2) above contain any material misstatement. v. The Bank has declared and paid dividend during the year which is in compliance with section 123 of the Act and the Banking Regulation Act, 1949. vi. Based on our examination which included test checks, the Bank has used an accounting softwares for maintaining its books of account which has a feature of recording audit trail (edit log) facility, and the same has operated throughout the year for all relevant transactions recorded in the softwares. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with. h. With respect to the other matters to be included in the Auditor’s Report in accordance with the requirements of Section 197(16) of the Act, as amended, the Bank is a banking Company as defined under Banking Regulation Act, 1949. Accordingly, the requirements prescribed under Section 197 of the Act do not apply. For M S K A & Associates Chartered Accountants ICAI Firm Registration No. 105047W For KKC & Associates LLP Chartered Accountants (Formerly Khimji Kunverji & Co LLP) ICAI Firm Registration No.105146W/W100621 Tushar Kurani Partner Membership Number.: 118580 UDIN: 24118580BKFLYA4385 Vinit Jain Partner Membership Number.: 145911 UDIN: 24145911BKFXMP7792 Place: Mumbai Date: 27 April 2024 Place: Mumbai Date: 27 April 2024 152 | Annual Report 2023-24 Annexure “A” to the Independent Auditor’s report on the Standalone Financial Statements of ICICI Bank Limited for the year ended 31 March 2024 [Referred to in paragraph “17(f)” under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date] Report on the Internal Financial Controls with reference to the aforesaid Standalone Financial Statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013. Opinion 1. We have audited the internal financial controls with reference to standalone financial statements of ICICI Bank Limited (“the Bank”) as at 31 March 2024 in conjunction with our audit of the standalone financial statements of the Bank for the year ended on that date. 2. In our opinion, the Bank has, in all material respects, an adequate internal financial controls with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as at 31 March 2024, based on the internal control with reference to standalone financial statements criteria established by the Bank considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI) (the “Guidance Note”). Management’s Responsibility for Internal Financial Controls 3. The Bank’s Management is responsible for establishing and maintaining internal financial controls based on the internal control with reference to standalone financial statements criteria established by the Bank considering the essential components of internal control stated in the Guidance Note. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Bank’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act. Auditor’s Responsibility 4. Our responsibility is to express an opinion on the Bank's internal financial controls with reference to standalone financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to standalone financial statements was established and maintained and if such controls operated effectively in all material respects. 5. Our audit involves performing procedures to obtain audit evidence about the adequacy of internal financial controls with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to standalone financial statements included obtaining an understanding of internal financial controls with reference to standalone financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. 6. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Bank’s internal financial controls with reference to standalone financial statements. Meaning of Internal Financial Controls with Reference to Standalone Financial Statements 7. Bank's internal financial control with reference to standalone financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of standalone financial statements for external purposes in accordance with generally accepted accounting principles. A Bank's internal financial control with reference to standalone financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and Annual Report 2023-24 | 153 Integrated Report Statutory Reports Financial Statements dispositions of the assets of the bank; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of standalone financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the bank are being made only in accordance with authorizations of management and directors of the bank; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the bank's assets that could have a material effect on the standalone financial statements. Inherent Limitations of Internal Financial Controls with Reference to Standalone Financial Statements 8. Because of the inherent limitations of internal financial controls with reference to standalone financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to standalone financial statements to future periods are subject to the risk that the internal financial control with reference to standalone financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. For M S K A & Associates Chartered Accountants ICAI Firm Registration No. 105047W For KKC & Associates LLP Chartered Accountants (Formerly Khimji Kunverji & Co LLP) ICAI Firm Registration No.105146W/W100621 Tushar Kurani Partner Membership Number.: 118580 UDIN: 24118580BKFLYA4385 Vinit Jain Partner Membership Number.: 145911 UDIN: 24145911BKFXMP7792 Place: Mumbai Date: 27 April 2024 Place: Mumbai Date: 27 April 2024 Annexure A (Contd.) 154 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED BALANCE SHEET at March 31, 2024 ` in ‘000s Schedule At 31.03.2024 At 31.03.2023 CAPITAL AND LIABILITIES Capital 1 14,046,790 13,967,750 Employees stock options outstanding 1A 14,053,180 7,608,859 Reserves and surplus 2 2,355,893,246 1,985,577,170 Deposits 3 14,128,249,513 11,808,406,972 Borrowings 4 1,249,675,779 1,193,254,936 Other liabilities and provisions 5 953,227,258 833,250,836 TOTAL CAPITAL AND LIABILITIES 18,715,145,766 15,842,066,523 ASSETS Cash and balances with Reserve Bank of India 6 897,116,960 685,261,721 Balances with banks and money at call and short notice 7 502,143,120 509,121,002 Investments 8 4,619,422,722 3,623,297,355 Advances 9 11,844,063,894 10,196,383,053 Fixed assets 10 108,598,403 95,998,412 Other assets 11 743,800,667 732,004,980 TOTAL ASSETS 18,715,145,766 15,842,066,523 Contingent liabilities 12 46,557,617,752 42,831,654,487 Bills for collection 1,007,917,603 864,547,740 Significant accounting policies and notes to accounts 17 & 18 The Schedules referred to above form an integral part of the Standalone Balance Sheet. As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 Annual Report 2023-24 | 155 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED PROFIT AND LOSS ACCOUNT for the year ended March 31, 2024 ` in ‘000s Schedule Year ended 31.03.2024 Year ended 31.03.2023 I. INCOME Interest earned 13 1,428,909,420 1,092,313,380 Other income 14 229,577,689 198,314,479 TOTAL INCOME 1,658,487,109 1,290,627,859 II. EXPENDITURE Interest expended 15 685,852,236 471,027,360 Operating expenses 16 391,327,336 328,732,391 Provisions and contingencies (refer note 18.42) 172,424,843 171,903,146 TOTAL EXPENDITURE 1,249,604,415 971,662,897 III. PROFIT/(LOSS) Net profit/(loss) for the period/year 408,882,694 318,964,962 Profit brought forward 563,569,883 436,713,394 TOTAL PROFIT/(LOSS) 972,452,577 755,678,356 IV. APPROPRIATIONS/TRANSFERS Transfer to Statutory Reserve 102,221,000 79,742,000 Transfer to Capital Reserve 332,500 878,200 Transfer to/(from) Investment Fluctuation Reserve 9,927,900 1,043,810 Transfer to Revenue and other reserves - 50,000,000 Transfer to Special Reserve 30,208,000 25,650,000 Dividend paid during the period/year 55,985,964 34,794,463 Balance carried over to balance sheet 773,777,213 563,569,883 TOTAL 972,452,577 755,678,356 Significant accounting policies and notes to accounts 17 & 18 Earnings per share (refer note 18.1) Basic (`) 58.38 45.79 Diluted (`) 57.33 44.89 Face value per share (`) 2.00 2.00 The Schedules referred to above form an integral part of the Standalone Profit and Loss Account. As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 156 | Annual Report 2023-24 ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 Cash flow from/(used in) operating activities Profit/(loss) before taxes 544,878,310 424,212,254 Adjustments for: Depreciation and amortisation 17,228,733 14,446,815 Net (appreciation)/depreciation on investments 15,652,829 25,947,137 Provision in respect of non-performing and other assets 9,447,877 (6,222,899) General provision for standard assets 11,548,326 5,795,607 Provision for contingencies & others 8,545,128 54,087,695 Employee Stock Options Expense 7,028,323 5,172,383 Income from subsidiaries and consolidated entities (20,729,074) (17,845,592) (Profit)/loss on sale of fixed assets (143,368) (534,906) (i) 593,457,084 505,058,494 Adjustments for: (Increase)/decrease in investments (388,852,304) 118,142,776 (Increase)/decrease in advances (1,661,040,967) (1,606,959,156) Increase/(decrease) in deposits 2,319,842,540 1,162,749,545 (Increase)/decrease in other assets (36,562,549) (87,869,550) Increase/(decrease) in other liabilities and provisions 100,573,306 82,944,583 (ii) 333,960,026 (330,991,802) Refund/(payment) of direct taxes (iii) (110,851,174) (97,163,542) Net cash flow from/(used in) operating activities (i)+(ii)+(iii) (A) 816,565,936 76,903,150 Cash flow from/(used in) investing activities Redemption/sale from/(investments in) subsidiaries (including application money) (28,239,282) (5,299,820) Income from subsidiaries, joint ventures and consolidated entities 20,729,074 17,845,592 Purchase of fixed assets (28,747,829) (20,200,892) Proceeds from sale of fixed assets 544,801 2,815,987 (Purchase)/sale of held-to-maturity securities (590,774,362) (652,674,032) Net cash flow from/(used in) investing activities (B) (626,487,598) (657,513,165) Cash flow from/(used in) financing activities Proceeds from issue of share capital (including ESOPs) 11,708,675 9,420,691 Proceeds from long-term borrowings 292,840,729 329,872,556 Repayment of long-term borrowings (320,339,104) (183,073,266) Net proceeds/(repayment) of short-term borrowings 82,534,163 (27,161,726) Dividend paid (55,985,964) (34,794,463) Net cash flow from/(used in) financing activities (C) 10,758,499 94,263,792 FINANCIAL STATEMENTS OF ICICI BANK LIMITED CASH FLOW STATEMENT for the year ended March 31, 2024 Annual Report 2023-24 | 157 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED CASH FLOW STATEMENT for the year ended March 31, 2024 (Contd.) ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 Effect of exchange fluctuation on translation reserve (D) 4,040,520 2,505,314 Net increase/(decrease) in cash and cash equivalents (A) + (B) + (C) + (D) 204,877,357 (483,840,909) Cash and cash equivalents at beginning of the year 1,194,382,723 1,678,223,632 Cash and cash equivalents at end of the year 1,399,260,080 1,194,382,723 1. Cash and cash equivalents include cash in hand, foreign currency notes, balances with RBI, balances with other banks and money at call and short notice. As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 158 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 1 - CAPITAL Authorised capital 12,500,000,000 equity shares of ` 2 each (March 31, 2023: 12,500,000,000 equity shares of ` 2 each) 25,000,000 25,000,000 Equity share capital Issued, subscribed and paid-up capital 6,982,815,731 equity shares of ` 2 each (March 31, 2023: 6,948,771,375 equity shares) 13,965,631 13,897,543 Add: 39,519,912 equity shares of ` 2 each (March 31, 2023: 34,044,356 equity shares) issued during the year 79,040 68,088 14,044,671 13,965,631 Add: Forfeited equity shares1 2,119 2,119 TOTAL CAPITAL 14,046,790 13,967,750 1. On account of forfeiture of 266,089 equity shares of ` 10 each. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 1A - EMPLOYEES STOCK OPTIONS OUTSTANDING Opening balance 7,608,859 2,664,141 Additions during the year1 7,028,323 5,172,383 Deductions during the year2 (584,002) (227,665) Closing balance 14,053,180 7,608,859 1. Represents cost of employee stock options/units recognised during the year. 2. Represents amount transferred to securities premium on account of exercise of employee stock options and to General Reserve on lapses of employee stock options. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 2 - RESERVES AND SURPLUS I. Statutory reserve Opening balance 435,778,519 356,036,519 Additions during the year 102,221,000 79,742,000 Deductions during the year - - Closing balance 537,999,519 435,778,519 II. Special reserve Opening balance 154,490,000 128,840,000 Additions during the year 30,208,000 25,650,000 Deductions during the year - - Closing balance 184,698,000 154,490,000 III. Securities premium Opening balance 505,830,228 496,253,897 Additions during the year1 12,206,166 9,576,331 Deductions during the year - - Closing balance 518,036,394 505,830,228 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet Annual Report 2023-24 | 159 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet (Contd.) ` in ‘000s At 31.03.2024 At 31.03.2023 IV. Investment reserve account Opening balance - - Additions during the year - - Deductions during the year - - Closing balance - - V. Investment fluctuation reserve2 Opening balance 21,758,809 20,714,999 Additions during the year 9,927,900 1,043,810 Deductions during the year - - Closing balance 31,686,709 21,758,809 VI. Capital reserve Opening balance 150,418,662 149,540,462 Additions during the year3 332,500 878,200 Deductions during the year - - Closing balance 150,751,162 150,418,662 VII. Capital redemption reserve Opening balance 3,500,000 3,500,000 Additions during the year - - Deductions during the year - - Closing balance 3,500,000 3,500,000 VIII. Foreign currency translation reserve Opening balance 10,238,275 7,732,961 Additions during the year4 4,040,520 2,505,314 Deductions during the year - - Closing balance 14,278,795 10,238,275 IX. Revaluation reserve Opening balance 30,624,626 31,956,593 Additions during the year5 1,174,473 839,516 Deductions during the year6 (965,562) (2,171,483) Closing balance 30,833,537 30,624,626 X. Revenue and other reserves Opening balance 109,368,168 57,267,116 Additions during the year7 963,749 52,101,052 Deductions during the year - - Closing balance 110,331,917 109,368,168 XI. Balance in profit and loss account 773,777,213 563,569,883 TOTAL RESERVES AND SURPLUS 2,355,893,246 1,985,577,170 1. Includes amount on account of exercise of employee stock options. 2. Represents amount transferred to Investment Fluctuation Reserve (IFR) on net profit on sale of AFS and HFT investments during the period. The amount not less than the lower of net profit on sale of AFS and HFT category investments during the period or net profit for the period less mandatory appropriations is required to be transferred to IFR, until the amount of IFR is at least 2% of the HFT and AFS portfolio. 3. Represents appropriations made for profit on sale of investments in held-to-maturity category and profit on sale of land and buildings, net of taxes and transfer to statutory reserve. 4. Includes transfer of accumulated translation loss of ` 3,396.6 million related to closure of Bank’s Offshore Banking Unit, SEEPZ Mumbai, to profit and loss account in terms of Accounting Standard 11 - The Effects of Changes in Foreign Exchange Rates. 5. Represents gain on revaluation of premises carried out by the Bank. 6. Includes amount transferred from revaluation reserve to general reserve on account of incremental depreciation charge on revaluation and revaluation surplus on premises sold. Also includes the amount of loss on revaluation of certain assets which were held for sale. 7. Includes amount transferred from Employee Stock Options outstanding to general reserve on lapses of employee stock options during the period. 160 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 3 - DEPOSITS A. I. Demand deposits i) From banks 47,943,206 49,917,686 ii) From others 1,887,779,486 1,564,941,951 II. Savings bank deposits 4,022,998,921 3,797,758,853 III. Term deposits i) From banks 208,627,693 113,475,314 ii) From others 7,960,900,207 6,282,313,168 TOTAL DEPOSITS 14,128,249,513 11,808,406,972 B. I. Deposits of branches in India 13,976,772,353 11,660,582,193 II. Deposits of branches outside India 151,477,160 147,824,779 TOTAL DEPOSITS 14,128,249,513 11,808,406,972 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 4 - BORROWINGS I. Borrowings in India i) Reserve Bank of India1 - - ii) Other banks 20,851,250 - iii) Financial institutions2 387,143,200 355,946,900 iv) Borrowings in the form of bonds and debentures (excluding subordinated debt) 461,120,224 460,418,579 v) Capital instruments a) Innovative Perpetual Debt Instruments (IPDI) (qualifying as additional Tier 1 capital) - 51,400,000 b) Unsecured redeemable debentures/bonds (subordinated debt included in Tier 2 capital) 28,497,430 31,409,320 TOTAL BORROWINGS IN INDIA 897,612,104 899,174,799 II. Borrowings outside India i) Bonds and notes 133,372,570 131,367,581 ii) Other borrowings 218,691,105 162,712,556 TOTAL BORROWINGS OUTSIDE INDIA 352,063,675 294,080,137 TOTAL BORROWINGS 1,249,675,779 1,193,254,936 1. Represents borrowings made under Liquidity Adjustment Facility (LAF). 2. Includes borrowings made under repo and refinance. 3. Secured borrowings in I and II above amount to Nil (March 31, 2023: Nil) and no borrowings made under market repurchase transactions (including tri-party repo) with banks and financial institutions and transactions under liquidity adjustment facility and marginal standing facility (March 31, 2023: Nil) FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet (Contd.) Annual Report 2023-24 | 161 Integrated Report Statutory Reports Financial Statements ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 5 - OTHER LIABILITIES AND PROVISIONS I. Bills payable 126,731,523 134,783,012 II. Inter-office adjustments (net) 420,905 3,228,016 III. Interest accrued 34,150,501 30,423,631 IV. Sundry creditors 197,250,382 167,703,280 V. General provision for standard assets (refer note 18.20) 58,631,606 47,022,362 VI. Unrealised loss on foreign exchange and derivative contracts1 173,575,855 178,698,973 VII. Others (including provisions)2 362,466,486 271,391,562 TOTAL OTHER LIABILITIES AND PROVISIONS 953,227,258 833,250,836 1. Gross unrealised gain on foreign exchange and derivative contracts is disclosed under Schedule 11 - Other assets. 2. Includes contingency provision amounting to ` 131,000.0 million (March 31, 2023: ` 131,000.0 million) and specific provision for standard loans amounting to ` 9,795.3 million (March 31, 2023: ` 14,946.9 million). ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 6 - CASH AND BALANCES WITH RESERVE BANK OF INDIA I. Cash in hand (including foreign currency notes) 87,516,682 85,594,376 II. Balances with Reserve Bank of India (a) in current account 625,010,278 480,247,345 (b) in other accounts1 184,590,000 119,420,000 TOTAL CASH AND BALANCES WITH RESERVE BANK OF INDIA 897,116,960 685,261,721 1. Represents lending under Liquidity Adjustment Facility (LAF) and Standing Deposit Facility (SDF). ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 7 - BALANCES WITH BANKS AND MONEY AT CALL AND SHORT NOTICE I. In India i) Balances with banks a) In current accounts 84,825 1,161,580 b) In other deposit accounts 1,185,000 39,768,173 ii) Money at call and short notice a) With banks 4,170,250 8,217,000 b) With other institutions1 122,517,010 6,000,000 TOTAL 127,957,085 55,146,753 II. Outside India i) In current accounts 200,907,593 283,001,318 ii) In other deposit accounts 80,071,639 26,708,047 iii) Money at call and short notice 93,206,803 144,264,884 TOTAL 374,186,035 453,974,249 TOTAL BALANCES WITH BANKS AND MONEY AT CALL AND SHORT NOTICE 502,143,120 509,121,002 1. Includes lending under reverse repo. FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet (Contd.) 162 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 8 - INVESTMENTS I. Investments in India [net of provisions] i) Government securities 3,755,955,316 3,057,772,845 ii) Other approved securities - - iii) Shares (includes equity and preference shares) 26,796,577 21,711,915 iv) Debentures and bonds (including commercial paper and certificate of deposits) 472,649,378 288,094,031 v) Subsidiaries and/or joint ventures 97,153,369 68,914,088 vi) Others (mutual fund units, pass through certificates, security receipts, and other related investments) 190,131,026 105,787,007 TOTAL INVESTMENTS IN INDIA 4,542,685,666 3,542,279,886 II. Investments outside India [net of provisions] i) Government securities 39,849,260 42,389,373 ii) Subsidiaries and/or joint ventures abroad (includes equity and preference shares) 19,698,901 19,698,901 iii) Others (equity shares, bonds and certificate of deposits) 17,188,895 18,929,195 TOTAL INVESTMENTS OUTSIDE INDIA 76,737,056 81,017,469 TOTAL INVESTMENTS 4,619,422,722 3,623,297,355 A. Investments in India Gross value of investments 4,602,653,199 3,599,811,662 Less: Aggregate of provision/depreciation/(appreciation) 59,967,533 57,531,776 Net investments 4,542,685,666 3,542,279,886 B. Investments outside India Gross value of investments 80,601,949 85,062,773 Less: Aggregate of provision/depreciation/(appreciation) 3,864,893 4,045,304 Net investments 76,737,056 81,017,469 TOTAL INVESTMENTS 4,619,422,722 3,623,297,355 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet (Contd.) Annual Report 2023-24 | 163 Integrated Report Statutory Reports Financial Statements ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 9 - ADVANCES [net of provisions] A. i) Bills purchased and discounted1 495,231,226 495,756,534 ii) Cash credits, overdrafts and loans repayable on demand 3,438,535,695 2,799,818,550 iii) Term loans 7,910,296,973 6,900,807,969 TOTAL ADVANCES 11,844,063,894 10,196,383,053 B. i) Secured by tangible assets (includes advances against book debts) 8,309,588,182 7,123,779,285 ii) Covered by bank/government guarantees 85,833,280 153,940,219 iii) Unsecured 3,448,642,432 2,918,663,549 TOTAL ADVANCES 11,844,063,894 10,196,383,053 C. I. Advances in India i) Priority sector 3,739,060,521 2,807,812,582 ii) Public sector 510,801,139 516,152,443 iii) Banks 16,359,843 7,698,171 iv) Others 7,243,335,298 6,523,615,093 TOTAL ADVANCES IN INDIA 11,509,556,801 9,855,278,289 II. Advances outside India i) Due from banks - - ii) Due from others a) Bills purchased and discounted 112,888,198 151,133,779 b) Syndicated and term loans 107,091,606 101,434,591 c) Others 114,527,289 88,536,394 TOTAL ADVANCES OUTSIDE INDIA 334,507,093 341,104,764 TOTAL ADVANCES 11,844,063,894 10,196,383,053 1. Net of bills re-discounted amounting to ` 5,000.0 million (March 31, 2023: ` 10,000.0 million). FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet (Contd.) 164 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 10 - FIXED ASSETS I. Premises Gross block At cost at March 31 of preceding year 81,224,390 81,486,941 Additions during the year1 4,367,362 2,401,505 Deductions during the year (805,718) (2,664,056) Closing balance 84,786,034 81,224,390 Depreciation At March 31 of preceding year 21,887,776 20,180,009 Charge during the year2 2,569,852 2,154,851 Deductions during the year (500,864) (447,084) Total depreciation 23,956,764 21,887,776 Net block3 60,829,270 59,336,614 II. Other fixed assets (including furniture and fixtures) Gross block At cost at March 31 of preceding year 98,422,944 88,772,438 Additions during the year 25,274,036 15,409,102 Deductions during the year (3,554,179) (5,758,596) Closing balance 120,142,801 98,422,944 Depreciation At March 31 of preceding year 64,827,902 59,595,871 Charge during the year 13,857,226 10,893,499 Deductions during the year (3,445,233) (5,661,468) Total depreciation 75,239,895 64,827,902 Net block 44,902,906 33,595,042 III. Lease assets Gross block At cost at March 31 of preceding year 17,902,406 17,890,746 Additions during the year 531 11,660 Deductions during the year (2,650) - Closing balance4 17,900,287 17,902,406 Depreciation At March 31 of preceding year 14,835,650 14,636,086 Charge during the year 199,375 199,564 Deductions during the year (965) - Total depreciation, accumulated lease adjustment and provisions 15,034,060 14,835,650 Net block 2,866,227 3,066,756 TOTAL FIXED ASSETS 108,598,403 95,998,412 1. Includes revaluation gain amounting to ` 1,174.5 million (March 31, 2023: ` 839.5 million) on account of revaluation carried out by the Bank. 2. Includes depreciation charge on account of revaluation amounting to ` 806.9 million for the year ended March 31, 2024 (year ended March 31, 2023: ` 748.4 million). 3. Includes assets amounting to ` 8.8 million (March 31, 2023: ` 428.8 million) which are held for sale. 4. Includes assets taken on lease amounting to ` 1,185.7 million (March 31, 2023: ` 1,187.8 million). FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet (Contd.) Annual Report 2023-24 | 165 Integrated Report Statutory Reports Financial Statements ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 11 - OTHER ASSETS I. Inter-office adjustments (net) - - II. Interest accrued 158,626,876 123,894,716 III. Tax paid in advance/tax deducted at source (net) 6,426,448 16,081,826 IV. Stationery and stamps 3,230 3,181 V. Non-banking assets acquired in satisfaction of claims1,2 - - VI. Advances for capital assets 6,960,309 7,393,764 VII. Deposits 63,455,018 48,012,567 VIII. Deferred tax assets (net) (refer note 18.44) 59,546,321 75,034,537 IX. Deposits in Rural Infrastructure and Development Fund 200,918,559 216,216,187 X. Unrealised gain on foreign exchange and derivative contracts3 160,771,101 172,562,634 XI. Others 87,092,805 72,805,568 TOTAL OTHER ASSETS 743,800,667 732,004,980 1. Assets amounting to ` 2.6 million were transferred from banking assets to non-banking asset during the year ended March 31, 2024 (year ended March 31, 2023: Nil). Assets amounting to ` 827.7 million were sold during year ended March 31, 2024 (year ended March 31, 2023: Nil). 2. Net of provision of ` 28,189.9 million (March 31, 2023: ` 29,011.8 million). 3. Gross unrealised loss on foreign exchange and derivative contracts is disclosed under Schedule 5 - Other liabilities. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 12 - CONTINGENT LIABILITIES I. Claims against the Bank not acknowledged as debts 93,293,080 81,963,017 II. Liability for partly paid investments 93,095 12,455 III. Liability on account of outstanding forward exchange contracts1 15,600,221,876 15,330,218,103 IV. Guarantees given on behalf of constituents a) In India 1,374,917,331 1,107,502,893 b) Outside India 118,731,736 130,675,436 V. Acceptances, endorsements and other obligations 520,724,381 441,907,720 VI. Currency swaps1 541,254,033 564,629,994 VII. Interest rate swaps, currency options and interest rate futures1 28,197,214,343 25,089,176,610 VIII. Other items for which the Bank is contingently liable 111,167,877 85,568,259 TOTAL CONTINGENT LIABILITIES 46,557,617,752 42,831,654,487 1. Represents notional amount. FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Balance Sheet (Contd.) 166 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Profit and Loss Account (Contd.) ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 SCHEDULE 13 - INTEREST EARNED I. Interest/discount on advances/bills 1,109,439,334 839,429,657 II. Income on investments 286,309,911 208,884,565 III. Interest on balances with Reserve Bank of India and other inter-bank funds 17,913,925 18,505,130 IV. Others1,2 15,246,250 25,494,028 TOTAL INTEREST EARNED 1,428,909,420 1,092,313,380 1. Includes interest on income tax refunds amounting to ` 2,650.1 million (March 31, 2023: ` 1,144.8 million). 2. Includes interest and amortisation of premium on non-trading interest rate swaps and foreign currency swaps. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 14 - OTHER INCOME I. Commission, exchange and brokerage 168,752,999 147,765,850 II. Profit/(loss) on sale of investments (net) 7,079,897 1,737,270 III. Profit/(loss) on revaluation of investments (net) 1,049,387 (1,296,397) IV. Profit/(loss) on sale of land, buildings and other assets (net)1 143,368 534,906 V. Profit/(loss) on exchange/derivative transactions (net) 29,988,645 30,278,524 VI. Income earned by way of dividends, etc. from subsidiary companies and/or joint ventures abroad/in India 20,729,074 17,845,592 VII. Miscellaneous income (including lease income) 1,834,319 1,448,734 TOTAL OTHER INCOME 229,577,689 198,314,479 1. Includes profit/(loss) on sale of assets given on lease. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 15 - INTEREST EXPENDED I. Interest on deposits 578,574,729 389,680,668 II. Interest on Reserve Bank of India/inter-bank borrowings 25,256,684 9,335,421 III. Others (including interest on borrowings of erstwhile ICICI Limited) 82,020,823 72,011,271 TOTAL INTEREST EXPENDED 685,852,236 471,027,360 Annual Report 2023-24 | 167 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Standalone Profit and Loss Account (Contd.) ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 SCHEDULE 16 - OPERATING EXPENSES I. Payments to and provisions for employees 151,419,918 120,599,320 II. Rent, taxes and lighting1 15,335,067 13,789,914 III. Printing and stationery 3,332,210 2,471,090 IV. Advertisement and publicity 17,040,002 14,773,598 V. Depreciation on Bank's property 16,427,078 13,048,350 VI. Depreciation (including lease equalisation) on leased assets 199,361 199,538 VII. Directors' fees, allowances and expenses 53,543 47,851 VIII. Auditors' fees and expenses 67,219 60,199 IX. Law charges 739,739 1,277,541 X. Postages, courier, telephones, etc. 7,344,706 5,896,242 XI. Repairs and maintenance 31,625,309 31,251,038 XII. Insurance 17,004,634 14,789,240 XIII. Direct marketing agency expenses 32,998,191 28,901,240 XIV. Other expenditure2,3 97,740,359 81,627,230 TOTAL OPERATING EXPENSES 391,327,336 328,732,391 1. Includes lease expense amounting to ` 11,924.3 million (March 31, 2023: ` 10,784.1 million). 2. Includes expenses on purchase of Priority Sector Lending Certificates (PSLC) amounting to ` 16,428.5 million (March 31, 2023: ` 15,035.2 million). 3. Includes expenses on reward program amounting to ` 18,414.8 million (March 31, 2023: ` 12,764.2 million). 4. Net of recoveries from group companies towards shared services. 168 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) SCHEDULE 17 SIGNIFICANT ACCOUNTING POLICIES Overview ICICI Bank Limited (ICICI Bank or the Bank), incorporated in Vadodara, India is a publicly held banking company engaged in providing a wide range of banking and financial services including commercial banking and treasury operations. ICICI Bank is a banking company governed by the Banking Regulation Act, 1949. The Bank also has overseas branches in Bahrain, China, Dubai, Hong Kong, Singapore, United States of America and Offshore Banking units. Basis of preparation The financial statements have been prepared in accordance with requirements prescribed under the Third Schedule of the Banking Regulation Act, 1949. The accounting and reporting policies of ICICI Bank used in the preparation of these financial statements conform to Generally Accepted Accounting Principles in India (Indian GAAP), the guidelines issued by Reserve Bank of India (RBI) from time to time and the Accounting Standards notified under Section 133 of the Companies Act, 2013 read together with paragraph 7 of the Companies (Accounts) Rules, 2014 and Companies (Accounting Standard) Rule 2021 to the extent applicable and practices generally prevalent in the banking industry in India. The Bank follows the historical cost convention and the accrual method of accounting, except in the case of interest and other income on non-performing assets (NPAs) where it is recognised upon realisation. Use of estimates The preparation of financial statements requires management to make estimates and assumptions that are considered in the reported amounts of assets and liabilities (including contingent liabilities) as of the date of the financial statements and the reported income and expenses during the reporting period. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual results could differ from these estimates. The impact of any revision in these estimates is recognised prospectively from the period of change. SIGNIFICANT ACCOUNTING POLICIES 1. Revenue recognition a) Interest income is recognised in the profit and loss account as it accrues, except in the case of non-performing assets (NPAs) where it is recognised upon realisation, as per the income recognition and asset classification norms of RBI. b) Income on discounted instruments is recognised over the tenure of the instrument on a constant yield basis. c) Dividend income is accounted on accrual basis when the right to receive the dividend is established. d) Loan processing fee is accounted for upfront when it becomes due. e) Project appraisal/structuring fee is accounted for on the completion of the agreed service. f) Arranger fee is accounted for as income when a significant portion of the arrangement is completed and right to receive is established. g) Commission received on guarantees and letters of credit issued is amortised on a straight-line basis over the period of the guarantee/letters of credit. h) The annual/renewal fee on credit cards, debit cards and prepaid cards are amortised on a straight line basis over one year. i) Fees paid/received for priority sector lending certificates (PSLC) is amortised on straight-line basis over the period of the certificate. Annual Report 2023-24 | 169 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) j) All other fees are accounted for as and when they become due where the Bank is reasonably certain of ultimate collection. 2. Investments Investments are accounted for in accordance with the extant RBI guidelines on classification, valuation and operation of investment portfolio by Banks. The Bank follows trade date method of accounting for purchase and sale of investments, except for government of India and state government securities where settlement date method of accounting is followed in accordance with RBI guidelines. Classification: All investments are classified into ‘Held to Maturity’ (HTM), ‘Available for Sale’ (AFS) and ‘Held for Trading’ (HFT) on the date of purchase as per the extant RBI guidelines on classification, valuation and operation of investment portfolio by Banks. Reclassifications, if any, in any category are accounted for as per RBI guidelines. Under each classification, the investments are further categorised as (a) government securities, (b) other approved securities, (c) shares, (d) bonds and debentures, (e) subsidiaries and joint ventures and (f) others. Investments that are held principally for resale within 90 days from the date of purchase are classified as HFT securities. Investments which the Bank intends to hold till maturity are classified as HTM securities. Investments which are not classified in either of the above categories are classified under AFS securities. Investments in the equity of subsidiaries/joint ventures are classified under HTM or AFS categories. Cost of acquisition: Costs, including brokerage and commission pertaining to trading book investments paid at the time of acquisition and broken period interest (the amount of interest from the previous interest payment date till the date of purchase of instruments) on debt instruments, are charged to the profit and loss account. Valuation: Securities are valued scrip-wise. Depreciation/appreciation on securities, other than those acquired by way of conversion of outstanding loans, is aggregated for each category. Net appreciation in each category under each investment classification, if any, being unrealised, is ignored, while net depreciation is provided. The depreciation on securities acquired by way of conversion of outstanding loans is fully provided. Non-performing investments are identified based on the RBI guidelines. HTM securities are carried at their acquisition cost or at amortised cost, if acquired at a premium over the face value. Any premium over the face value of fixed rate and floating rate securities acquired is amortised over the remaining period to maturity on a constant yield basis and straight line basis respectively. AFS and HFT securities are valued periodically as per RBI guidelines. Any premium over the face value of fixed rate and floating rate investments in government securities, classified as AFS, is amortised over the remaining period to maturity on constant yield basis and straight line basis respectively. Quoted investments are valued based on the closing quotes on the recognised stock exchanges or prices declared by Primary Dealers Association of India (PDAI) jointly with Fixed Income Money Market and Derivatives Association (FIMMDA)/Financial Benchmark India Private Limited (FBIL), periodically. The market/fair value of unquoted government securities which are in nature of Statutory Liquidity Ratio (SLR) securities included in the ‘Available for Sale’ and ‘Held for Trading’ categories is as per the rates published by FBIL and for unquoted corporate bonds, security level valuation (SLV) published by FIMMDA. The valuation of other unquoted fixed income securities, including Pass Through Certificates, wherever linked to the Yield-to-Maturity (YTM) rates, is computed with a mark-up (reflecting associated credit risk) over the YTM rates for government securities published by FIMMDA. The sovereign foreign securities and non-INR India linked bonds are valued on the basis of prices published by the sovereign regulator or counterparty quotes. 170 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Treasury bills, commercial papers and certificate of deposits being discounted instruments, are valued at carrying cost. The units of mutual funds are valued at the latest repurchase price/net asset value declared by the mutual fund. Unquoted equity shares are valued at the break-up value, if the latest balance sheet is available, or at ` 1, as per RBI guidelines. Investments in units of Venture Capital Funds (VCFs)/Alternative Investment Fund (AIF) are categorised under HTM category for an initial period of three years and valued at cost. The units of VCF/(AIF) categorised under AFS are valued at the net asset value (NAV) declared by the VCF/AIF respectively. If the latest NAV is not available continuously for more than 18 months, the units of VCF/AIF are valued at ` 1, as per RBI guidelines. The units of Infrastructure Investment Trust (InvIT) are valued as per the quoted price available on the exchange. At the end of each reporting period, security receipts issued by the asset reconstruction companies are valued in accordance with the guidelines applicable to such instruments, prescribed by RBI from time to time. Accordingly, in cases where the cash flows from security receipts issued by the asset reconstruction companies are limited to the actual realisation of the financial assets assigned to the instruments in the concerned scheme, the Bank reckons the net asset value obtained from the asset reconstruction company from time to time, for valuation of such investments at each reporting period end. The Bank makes additional provisions on the security receipts based on the remaining period for the resolution period to end. The security receipts which are outstanding and not redeemed as at the end of the resolution period are treated as loss assets and are fully provided. The Bank assesses investments in subsidiaries for any other than temporary diminution in value and appropriate provisions are made. Depreciation/provision on non-performing investments is made as per internal provisioning norms, subject to minimum provisioning requirements of RBI. Disposal: Gain/loss on sale of investments is recognised in the profit and loss Account. Cost of investments is computed based on the First-In-First-Out (FIFO) method. The profit from sale of investment under HTM category, net of taxes and transfer to statutory reserve is transferred to “Capital Reserve” in accordance with the RBI Guidelines. Short sale: The Bank undertakes short sale transactions in dated central government securities in accordance with RBI guidelines. The short positions are categorised under HFT category and are marked to market. The mark-to-market loss is charged to profit and loss account and gain, if any, is ignored as per RBI guidelines. Repurchase transactions: Market repurchase, reverse repurchase and transactions with RBI under Liquidity Adjustment Facility (LAF)/Marginal Standing Facility (MSF) are accounted for as borrowing and lending transactions in accordance with the extant RBI guidelines. 3. Loans and other credit facilities Classification: The Bank classifies its loans and investments, including at overseas branches and overdues arising from crystallised derivative contracts, into performing and NPAs in accordance with RBI guidelines. Loans and advances held at the overseas branches that are identified as impaired as per host country regulations but which are standard as per the extant RBI guidelines are classified as NPAs to the extent of amount outstanding in the respective host country. Further, NPAs are classified into sub-standard, doubtful and loss assets based on the criteria stipulated by RBI. Interest on non-performing advances is transferred to an interest suspense account and not recognised in profit and loss account until received. Annual Report 2023-24 | 171 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The Bank considers an account as restructured, where for economic or legal reasons relating to the borrower’s financial difficulty, the Bank grants concessions to the borrower, that the Bank would not otherwise consider. The moratorium granted to the borrowers based on RBI guidelines is not accounted as restructuring of loan. Certain specified guidelines by RBI requires the asset classification to be maintained as “Standard”. Therefore, the borrowers where resolution plan was implemented under these guidelines are classified as standard restructured. Non-performing and restructured loans are upgraded to standard as per the extant RBI guidelines or host country regulations, as applicable. Provisioning: In the case of corporate loans and advances, provisions are made for sub-standard and doubtful assets as per internal provisioning norms, subject to minimum provisioning requirements of RBI. Loss assets and the unsecured portion of doubtful assets are fully provided. For impaired loans and advances held in overseas branches, which are performing as per RBI guidelines, provisions are made as per the host country regulations. For loans and advances held in overseas branches, which are NPAs both as per the RBI guidelines and host country regulations, provisions are made at the higher of the provisions required as per internal provisioning norms and host country regulations. Provisions on homogeneous non-performing retail loans and advances, subject to minimum provisioning requirements of RBI, are made on the basis of the ageing of the loan. The specific provisions on non-performing retail loans and advances held by the Bank are higher than the minimum regulatory requirements. In respect of non-retail loans reported as fraud to RBI the entire amount, is provided over a period not exceeding four quarters starting from the quarter in which fraud has been detected. In respect of non-retail loans where there has been delay in reporting the fraud to the RBI or which are classified as loss accounts, the entire amount is provided immediately. In case of fraud in retail accounts, the entire amount is provided immediately. In respect of borrowers classified as non-cooperative borrowers or willful defaulters, the Bank makes accelerated provisions as per RBI guidelines. The Bank holds specific provisions against non-performing loans and advances and against certain performing loans and advances in accordance with RBI directions. The Bank makes provision on restructured loans subject to minimum requirements as per RBI guidelines. Provision due to diminution in the fair value of restructured/rescheduled loans and advances is made in accordance with the applicable RBI guidelines. In terms of RBI guidelines, the NPAs are written-off in accordance with the Bank’s policy. Amounts recovered against bad debts written-off are recognised in the profit and loss account. The Bank maintains general provision on performing loans and advances in accordance with the RBI guidelines, including provisions on loans to borrowers having unhedged foreign currency exposure, provisions on loans to specific borrowers in specific stressed sectors, provision on exposures to step-down subsidiaries of Indian companies and provision on incremental exposure to borrowers identified as per RBI’s large exposure framework. For performing loans and advances in overseas branches, the general provision is made at higher of aggregate provision required as per host country regulations and RBI requirement. In addition to the provisions required to be held according to the asset classification status, provisions are held for individual country exposures including indirect country risk (other than for home country exposure). The countries are categorised into seven risk categories namely insignificant, low, moderately low, moderate, moderately high, high and very high, and provisioning is made on exposures exceeding 180 days on a graded scale ranging from 0.25% to 25%. For exposures with contractual maturity of less than 180 days, provision is required to be held at 25% of the rates applicable to exposures exceeding 180 days. The indirect exposure is reckoned at 50% of the exposure. If the Bank’s net funded exposure in respect of a country is less than 1% of its total assets, no provision is required on such country exposure. 172 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The Bank makes additional provisions as per RBI guidelines for the cases where viable resolution plan has not been implemented within the timelines prescribed by the RBI, from the date of default. These additional provisions are written-back on satisfying the conditions for reversal as per RBI guidelines. The Bank, on prudent basis, has made contingency provision on certain loan portfolios, including borrowers who had taken moratorium at any time during FY2021 under the extant RBI guidelines related to Covid-19 regulatory package. The Bank also makes additional contingency provision on certain standard assets. The contingency provision is included in ‘Schedule 5 - Other Liabilities and Provisions’. The Bank has a Board approved policy for making floating provision, which is in addition to the specific and general provisions made by the Bank. The floating provision is utilised, with the approval of Board and RBI, in case of contingencies which do not arise in the normal course of business and are exceptional and non-recurring in nature and for making specific provision for impaired loans as per the requirement if extant RBI guidelines or any regulatory guidance/instructions. The floating provision is netted-off from advances. 4. Transfer and servicing of assets The Bank transfers commercial and consumer loans through securitisation transactions. The transferred loans are de-recognised and gains/losses are accounted, only if the Bank surrenders the right to benefits specified in the underlying securitised loan contract. Recourse and servicing obligations are accounted for net of provisions. In accordance with the RBI guidelines for securitisation of standard assets, with effect from February 1, 2006, the profit/premium arising from securitisation is amortised over the life of the securities issued or to be issued by the special purpose vehicle to which the assets are sold. With effect from May 7, 2012, the RBI guidelines require the profit/premium arising from securitisation to be amortised based on the method prescribed in the guidelines. As per the RBI guidelines issued on September 24, 2021, gain realised at the time of securitisation of loans is accounted through profit and loss account on completion of transaction. The Bank accounts for any loss arising from securitisation immediately at the time of sale. The unrealised gains, associated with expected future margin income is recognised in profit and loss account on receipt of cash, after absorbing losses, if any. Net income arising from sale of loan assets through direct assignment with recourse obligation is amortised over the life of underlying assets sold and net income from sale of loan assets through direct assignment, without any recourse obligation, is recognised at the time of sale. Net loss arising on account of direct assignment of loan assets is recognised at the time of sale. As per the RBI guidelines issued on September 24, 2021, any loss or realised gain from sale of loan assets through direct assignment is accounted through profit and loss account on completion of transaction. The acquired loans is carried at acquisition cost. In case premium is paid on a loan acquired, premium is amortised over the loan tenure. In accordance with RBI guidelines, in case of non-performing loans sold to Asset Reconstruction Companies (ARCs), the Bank reverses the excess provision in profit and loss account in the year in which amounts are received. Any shortfall of sale value over the net book value on sale of such assets is recognised by the Bank in the year in which the loan is sold. 5. Fixed assets (Property, Plant and Equipment) Fixed assets, other than premises, are carried at cost less accumulated depreciation and impairment, if any. Premises are carried at revalued amount, being fair value at the date of revaluation less accumulated depreciation. Cost includes freight, duties, taxes and incidental expenses related to the acquisition and installation of the asset. Depreciation is charged over the estimated useful life of fixed assets on a straight-line basis. Assets purchased/sold during the year are depreciated on a pro-rata basis for the actual number of days the asset has been capitalised. Assets individually costing upto ` 5,000/- are depreciated fully in the year of acquisition. Annual Report 2023-24 | 173 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) In case of revalued/impaired assets, depreciation is provided over the remaining useful life of the assets with reference to revised asset values. In case of premises, which are carried at revalued amounts, the depreciation on the excess of revalued amount over historical cost is transferred from Revaluation Reserve to General Reserve annually. The profit on sale of premises is appropriated to Capital Reserve, net of transfer to Statutory Reserve and taxes, in accordance with RBI guidelines. The useful lives of the groups of fixed assets are given below. Asset Useful life Premises owned by the Bank 60 years Leased assets and improvements to leasehold premises 60 years or lease period whichever is lower ATMs1,2 5 - 8 years Plant and machinery1 (including office equipment) 5 -10 years Electric installations and equipments 10 - 15 years Computers 3 years Servers and network equipment1 4 – 10 years Furniture and fixtures1 5 – 10 years Motor vehicles1 5 years Others (including software)1,3 3-4 years 1. The useful life of fixed assets is based on historical experience of the Bank, which is different from the useful life as prescribed in Schedule II to the Companies Act, 2013. 2. Cash acceptor machine 3. Excludes software, which are procured based on licensing arrangements and depreciated over the period of license. 4. Assets at residences of Bank’s employees are depreciated over the estimated useful life of 5 years. Non-banking assets Non-banking assets (NBAs) acquired in satisfaction of claims are valued at the market value on a distress sale basis or value of loan, whichever is lower. Further, the Bank creates provision on these assets as per the extant RBI guidelines or specific RBI directions. 6. Translation of foreign currency items Foreign currency income and expenditure items of domestic operations are translated at the exchange rates prevailing on the date of the transaction. Income and expenditure items of integral foreign operations (representative offices) are translated at daily closing rates, and income and expenditure items of non-integral foreign operations (foreign branches and offshore banking units) are translated at quarterly average closing rates. Monetary foreign currency assets and liabilities of domestic and integral foreign operations are translated at closing exchange rates notified by Foreign Exchange Dealers’ Association of India (FEDAI) relevant to the balance sheet date and the resulting gains/losses are recognised in the profit and loss account. Both monetary and non-monetary foreign currency assets and liabilities of non-integral foreign operations are translated at relevant closing exchange rates notified by FEDAI at the balance sheet date and the resulting gains/ losses from exchange differences are accumulated in the foreign currency translation reserve until the disposal of the net investment in the non-integral foreign operations. Pursuant to RBI guideline, the Bank does not recognise the cumulative/proportionate amount of such exchange differences as income or expenses, which relate to repatriation of accumulated retained earnings from overseas operations, in the profit and loss account. Contingent liabilities on account of guarantees, endorsements and other obligations denominated in foreign currencies are disclosed at the closing exchange rates notified by FEDAI relevant to the balance sheet date. 174 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 7. Foreign exchange and derivative contracts Derivative transactions comprises of forward contracts, futures, swaps and options. The Bank undertakes derivative transactions for trading and hedging balance sheet assets and liabilities. The forward exchange contracts that are not intended for trading and are entered into to establish the amount of reporting currency required or available at the settlement date of a transaction are effectively valued at closing spot rate. The premium or discount arising on inception of such forward exchange contracts is amortised over the life of the contract as interest income/expense. All other outstanding forward exchange contracts are revalued based on the exchange rates notified by FEDAI for specified maturities and at interpolated rates for contracts of interim maturities. The contracts of longer maturities where exchange rates are not notified by FEDAI are revalued based on the forward exchange rates implied by the swap curves in respective currencies. The resultant gains or losses are recognised in the profit and loss account. The swap contracts entered to hedge on-balance sheet assets and liabilities are structured such that they bear an opposite and offsetting impact with the underlying on-balance sheet items. The impact of such derivative instruments is correlated with the movement of underlying assets and liabilities and accounted pursuant to the principles of hedge accounting. The Bank identifies the hedged item (asset or liability) at the inception of the transaction itself. Hedge effectiveness is ascertained at the time of the inception of the hedge and periodically thereafter. Based on RBI circular issued on June 26, 2019, the accounting of hedge relationships established after June 26, 2019 is in accordance with the Guidance note on Accounting for Derivative Contracts issued by ICAI. The swaps under hedge relationships established prior to that date are accounted on an accrual basis and are not marked to market unless their underlying transaction is marked-to-market. Gains or losses arising from hedge ineffectiveness, if any, are recognised in the profit and loss Account. The derivative contracts entered into for trading purposes are marked-to-market and the resulting gain or loss is accounted in the profit and loss account. Marked to market values of such derivatives are classified as assets when the fair value is positive or as liabilities when the fair value is negative. Premium for FC/INR option transaction is recognised as income/expense on expiry or early termination of the transaction. Mark to market gain/loss (adjusted for premium received/paid on options contracts) is recorded in the profit and loss account. The gain or loss arising on unwinding or termination of the contracts, is accounted for in the Profit and Loss account. Currency futures contracts are marked to market using daily settlement price on a trading day, which is the closing price of the respective futures contracts on that day. Pursuant to RBI guidelines, any receivables under derivative contracts which remain overdue for more than 90 days and mark-to-market gains on other derivative contracts with the same counter- parties are reversed through profit and loss account. 8. Employee Stock Option Scheme (ESOS) and Employee Stock Unit Scheme (ESUS) The Employees Stock Option Scheme 2000 (Option Scheme) provides for grant of options on the Bank’s equity shares to wholetime directors and employees of the Bank and its subsidiaries. The options granted vest in a graded manner and may be exercised within a specified period. The Employees Stock Unit Scheme - 2022 (Unit Scheme) provides for grant of units at face value to the eligible employees of the Bank and its subsidiaries. The units granted vest in a graded manner and as per vesting criteria and may be exercised within a specified period. Till March 31, 2021, the Bank recognised cost of stock options granted under Employee Stock Option Scheme, using intrinsic value method. Under Intrinsic value method, options cost is measured as the excess, if any, of the fair market price of the underlying stock over the exercise price on the grant date. The fair market price is the closing price on the stock exchange with highest trading volume of the underlying shares, immediately prior to the grant date. Pursuant to RBI clarification dated August 30, 2021, the cost of stock options/units granted after March 31, 2021 is recognised based on fair value method. The cost of stock options granted up to March 31, 2021 continues to be recognised on intrinsic value method. The Bank uses Black-Scholes model to fair value the options/units on the grant Annual Report 2023-24 | 175 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) date and the inputs used in the valuation model include assumptions such as the expected life of the share option/ units, volatility, risk free rate and dividend yield. The cost of stock options/units is recognised in the profit and loss account over the vesting period. 9. Employee Benefits Gratuity The Bank pays gratuity, a defined benefit plan, to employees who retire or resign after a minimum prescribed period of continuous service and in case of employees at overseas locations as per the rules in force in the respective countries. The Bank makes contribution to recognised trust which administers the funds on its own account or through insurance companies. Actuarial valuation of the gratuity liability is determined by an independent actuary appointed by the Bank. Actuarial valuation of gratuity liability is determined based on certain assumptions regarding rate of interest, salary growth, mortality and staff attrition as per the projected unit credit method. The actuarial gains or losses arising during the year are recognised in the profit and loss account. Superannuation Fund and National Pension Scheme The Bank has a superannuation fund, a defined contribution plan, which is administered by trustees and managed by insurance companies. The Bank contributes maximum 15.0% of the total annual basic salary for certain employees to superannuation funds. Further, the Bank contributes upto 10.0% of the total basic salary of certain employees to National Pension Scheme (NPS), a defined contribution plan, which is managed and administered by pension fund management companies. The employees are given an option to receive the amount in cash in lieu of such contributions along with their monthly salary during their employment. The amounts so contributed/paid by the Bank to the superannuation fund and NPS or to employees during the year are recognised in the profit and loss account. The Bank has no liability towards future benefits under superannuation fund and national pension scheme other than its annual contribution. Pension The Bank provides for pension, a defined benefit plan, covering eligible employees of erstwhile Bank of Madura, erstwhile Sangli Bank and erstwhile Bank of Rajasthan. The Bank makes contribution to a trust which administers the funds on its own account or through insurance companies. The plan provides for pension payment including dearness relief on a monthly basis to these employees on their retirement based on the respective employee’s years of service with the Bank and applicable salary. Actuarial valuation of the pension liability is determined by an independent actuary appointed by the Bank. Actuarial valuation of pension liability is calculated based on certain assumptions regarding rate of interest, salary growth, mortality and staff attrition as per the projected unit credit method. The actuarial gains or losses arising during the year are recognised in the profit and loss account. Employees covered by the pension plan are not eligible for employer’s contribution under the provident fund plan. Provident Fund The Bank is statutorily required to maintain a provident fund, a defined benefit plan, as a part of retirement benefits to its employees. Each employee contributes a certain percentage of his or her basic salary and the Bank contributes an equal amount for eligible employees. The Bank makes contribution as required by The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 to Employees’ Pension Scheme administered by the Regional Provident Fund Commissioner. The Bank makes balance contributions to a fund administered by trustees. The funds are invested according to the rules prescribed by the Government of India. The Bank recognises such contribution as an expense in the year in which it is incurred. 176 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Interest payable on provident fund should not be lower than the statutory rate of interest declared by the Central Government under the Employees Provident Funds and Miscellaneous Provisions Act, 1952. Actuarial valuation for the interest obligation on the provident fund balances is determined by an actuary appointed by the Bank. The actuarial gains or losses arising during the year are recognised in the profit and loss account. The overseas branches of the Bank and its eligible employees contribute a certain percentage of their salary towards respective government schemes as per local regulatory guidelines. The contribution made by the overseas branches is recognised in profit and loss account at the time of contribution. Compensated absences The Bank provides for compensated absence based on actuarial valuation conducted by an independent actuary. 10. Income Taxes Income tax expense is the aggregate amount of current tax and deferred tax expense incurred by the Bank. The current tax expense and deferred tax expense is determined in accordance with the provisions of the Income Tax Act, 1961 and as per Accounting Standard 22 - Accounting for Taxes on Income respectively. Deferred tax adjustments comprise changes in the deferred tax assets or liabilities during the year and change in tax rate. Deferred tax assets and liabilities are recognised by considering the impact of timing differences between taxable income and accounting income for the current year, and carry forward losses. Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. The impact of changes in deferred tax assets and liabilities is recognised in the profit and loss account. Deferred tax assets are recognised and re-assessed at each reporting date, based upon management’s judgement as to whether their realisation is considered as reasonably certain. However, in case of unabsorbed depreciation or carried forward loss, deferred tax assets will be recognised only if there is virtual certainty of realisation of such assets. 11. Impairment of Assets The Bank follows revaluation model of accounting for its premises and the recoverable amount of the revalued assets is considered to be close to its revalued amount. Accordingly, separate assessment for impairment of premises is not required. For assets other than premises, the Bank assesses at each balance sheet date whether there is any indication that an asset may be impaired. Impairment loss, if any, is provided in the profit and loss account to the extent the carrying amount of assets exceeds their estimated recoverable amount. 12. Provisions, contingent liabilities and contingent assets The Bank estimates the probability of any loss that might be incurred on outcome of contingencies on the basis of information available up to the date on which the financial statements are prepared. A provision is recognised when an enterprise has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are determined based on management estimates of amounts required to settle the obligation at the balance sheet date, supplemented by experience of similar transactions. These are reviewed at each balance sheet date and adjusted to reflect the current management estimates. In cases where the available information indicates that the loss on the contingency is reasonably possible but the amount of loss cannot be reasonably estimated, a disclosure to this effect is made in the financial statements. In case of remote possibility neither provision nor disclosure is made in the financial statements. The Bank does not account for or disclose contingent assets, if any. The Bank estimates the probability of redemption of customer loyalty reward points using an actuarial method by employing an independent actuary and accordingly makes provision for these reward points. Actuarial valuation is determined based on certain assumptions regarding mortality rate, discount rate, cancellation rate and redemption rate. Annual Report 2023-24 | 177 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 13. Earnings per share (EPS) Basic earnings per share is calculated by dividing the net profit or loss after tax for the year attributable to equity shareholders by the weighted average number of equity shares outstanding for the year. Diluted earnings per share reflect the potential dilution that could occur if contracts to issue equity shares were exercised or converted during the year. Diluted earnings per equity share is computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the year, except where the results are anti-dilutive. 14. Share issue expenses Share issue expenses are deducted from Securities Premium Account in terms of Section 52 of the Companies Act, 2013. 15. Bullion transaction The Bank deals in bullion business on a consignment basis. The bullion is priced to the customers based on the price quoted by the supplier. The difference between price recovered from customers and cost of bullion is accounted for as commission at the time of sales to the customers. The Bank also deals in bullion on a borrowing and lending basis and the interest expense/income is accounted on accrual basis. 16. Lease transactions Lease payments, including cost escalations, for assets taken on operating lease are recognised as an expense in the profit and loss account over the lease term on straight line basis. The leases of property, plant and equipment, where substantially all of the risks and rewards of ownership are transferred to the Bank are classified as finance lease. Minimum lease payments under finance lease are apportioned between the finance costs and outstanding liability. 17. Cash and cash equivalents Cash and cash equivalents include cash in hand, foreign currency notes, balances with RBI, balances with other banks and money at call and short notice. 18. Segment Reporting The disclosure related to segment information is in accordance with AS-17, Segment Reporting and as per guidelines issued by RBI. 178 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) SCHEDULE 18 NOTES FORMING PART OF THE ACCOUNTS The following disclosures have been made taking into account the requirements of Accounting Standards (ASs) and Reserve Bank of India (RBI) guidelines. 1. Earnings per share Basic and diluted earnings per equity share are computed in accordance with AS 20 – Earnings per share. Basic earnings per equity share is computed by dividing net profit/ (loss) after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed using the weighted average number of equity shares and weighted average number of dilutive potential equity shares outstanding during the year. The following table sets forth, for the periods indicated, the computation of earnings per share. ` in million, except per share data Particulars Year ended March 31, 2024 Year ended March 31, 2023 Net profit/(loss) attributable to equity shareholders used in computation of Basic and Diluted EPS 408,882.7 318,965.0 Nominal value per share (`) 2.00 2.00 Basic earnings per share (`) 58.38 45.79 Effect of potential equity shares (`) (1.05) (0.90) Diluted earnings per share (`)1 57.33 44.89 Reconciliation between weighted shares used in computation of basic and diluted earnings per share Weighted average number of equity shares outstanding used in computation of Basic EPS 7,003,943,116 6,966,305,957 Add: Effect of potential equity shares 128,245,813 138,684,400 Weighted average number of equity shares outstanding used in computation of Diluted EPS 7,132,188,929 7,104,990,357 1. The dilutive impact is due to options granted to employees by the Bank. 2. Business/Information ratios The following table sets forth, for the periods indicated, the business/information ratios. Sr. No. Particulars Year ended March 31, 2024 Year ended March 31, 2023 1. Interest income to working funds1 8.29% 7.40% 2. Non-interest income to working funds1 1.33% 1.34% 3. Cost of deposits 4.61% 3.66% 4. Net interest margin2 4.53% 4.48% 5. Operating profit to working funds1,3 3.37% 3.33% 6. Return on assets4 2.37% 2.16% 7. Net profit/(loss) per employee5 (` in million) 2.9 2.8 8. Business (average deposits plus average advances) per employee5,6 (` in million) 168.4 170.7 1. For the purpose of computing the ratio, working funds represent the simple average of balances of total assets computed for monthly reporting dates of Form X submitted to RBI under Section 27 of the Banking Regulation Act, 1949. 2. Net interest income/average earning assets. Net interest income is the difference of interest income and interest expense. Average earning assets are average of daily balance of interest earning assets. 3. Operating profit is profit for the year before provisions and contingencies. 4. For the purpose of computing the ratio, assets represent the monthly average of total assets computed for reporting dates of Form X submitted to RBI under Section 27 of the Banking Regulation Act, 1949. 5. Computed based on average number of employees which include sales executives, employees on fixed term contracts and interns. 6. The average deposits and the average advances represent the simple average of the figures reported in Form A to RBI under Section 42(2) of the Reserve Bank of India Act, 1934. Annual Report 2023-24 | 179 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 3. Capital adequacy ratio The Bank is subject to the Basel III capital adequacy guidelines stipulated by RBI with effect from April 1, 2013. As per the guidelines, the Tier-1 capital is made up of Common Equity Tier-1 (CET1) and Additional Tier-1. Basel III guidelines require the Bank to maintain a minimum Capital to Risk-Weighted Assets Ratio (CRAR) of 11.70% with minimum CET1 CRAR of 8.20% and minimum Tier-1 CRAR of 9.70%. The minimum total CRAR, Tier-1 CRAR and CET1 CRAR requirement include capital conservation buffer of 2.50% and additional capital requirement of 0.20% on account of the Bank being designated as Domestic Systemically Important Bank. The following table sets forth, for the periods indicated, computation of capital adequacy as per Basel III framework. ` in million, except percentage Particulars Year ended March 31, 2024 Year ended March 31, 2023 Common Equity Tier 1 capital (CET 1) 2,142,170.4 1,832,770.7 Additional Tier 1 capital - 51,400.0 Tier 1 capital (i + ii) 2,142,170.4 1,884,170.7 Tier 2 capital 100,104.4 78,652.2 Total capital (Tier 1+Tier 2) 2,242,274.8 1,962,822.9 Total Risk Weighted Assets (RWAs) 13,727,616.7 10,705,150.5 CET1 CRAR (%) 15.60% 17.12% Tier-1 CRAR (%) 15.60% 17.60% Tier-2 CRAR (%) 0.73% 0.74% Total CRAR (%) 16.33% 18.34% Leverage Ratio 9.79% 10.27% Percentage of the shareholding of a) Government of India 0.22% 0.20% Amount of equity capital raised1 - - Amount of non-equity Tier-1 capital raised during the year, of which: a) Perpetual Non-Cumulative Preference Shares - - b) Perpetual Debt Instruments - - Amount of Tier-2 capital raised; of which 1. Debt Capital Instruments - - 2. Preference Share Capital Instruments [Perpetual Cumulative Preference Shares (PCPS)/Redeemable Non- Cumulative Preference Shares (RNCPS)/Redeemable Cumulative Preference Shares (RCPS)] - - 1. Additionally ` 12,285.2 million raised pursuant to exercise of employee stock options during the year ended March 31, 2024 (year ended March 31, 2023: ` 9,644.4 million) 4. LIQUIDITY COVERAGE RATIO The Basel Committee on Banking Supervision (BCBS) had introduced the liquidity coverage ratio (LCR) in order to ensure that a bank has an adequate stock of unencumbered high quality liquid assets (HQLA) to survive a significant liquidity stress lasting for a period of 30 days. LCR is defined as a ratio of HQLA to the total net cash outflows estimated for the next 30 calendar days. As per the RBI guidelines, the minimum LCR required to be maintained by banks is 100.0%. 180 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, for the periods indicated, the quarterly average of unweighted and weighted values of the LCR of the Bank. The quarterly average LCR is computed based on simple average of daily observations during the quarter. Number of observations used in computing quarterly LCR for three months ended March 31, 2024: 60 days (three months ended December 31, 2023: 61 days: three months ended September 30, 2023: 62 days, three months June 30, 2023: 60 days and three months ended March 31, 2023: 61 days). ` in million Sr. No. Particulars Three months ended March 31, 2024 Three months ended March 31, 2023 Three months ended December 31, 2023 Three months ended September 30, 2023 Three months ended June 30, 2023 Total unweighted value (average) Total weighted value (average) Total unweighted value (average) Total weighted value (average) Total unweighted value (average) Total weighted value (average) Total unweighted value (average) Total weighted value (average) Total unweighted value (average) Total weighted value (average) High quality liquid assets 1. Total high quality liquid assets N.A 3,940,112.5 N.A. 3,234,595.5 N.A 3,720,001.9 N.A 3,610,698.8 N.A. 3,462,355.8 Cash outflows 2. Retail deposits and deposits from small business customers, of which: 7,926,612.1 689,376.8 6,764,179.8 573,450.1 7,650,002.7 664,961.7 7,368,971.3 641,826.6 7,048,563.0 612,960.1 (i) Stable deposits 2,065,686.8 103,284.3 2,059,358.0 102,967.9 2,000,771.5 100,038.6 1,901,410.8 95,070.5 1,837,924.4 91,896.2 (ii) Less stable deposits 5,860,925.3 586,092.5 4,704,821.8 470,482.2 5,649,231.2 564,923.1 5,467,560.5 546,756.1 5,210,638.6 521,063.9 3. Unsecured wholesale funding, of which: 4,452,605.4 2,379,461.0 3,607,311.0 1,911,837.1 4,264,068.7 2,264,162.8 4,063,814.7 2,139,024.9 3,812,549.3 1,998,261.5 (i) Operational deposits (all counterparties) - - - - - - - - - - (ii) Non-operational deposits (all counterparties) 4,367,338.4 2,294,194.0 3,550,488.4 1,855,014.5 4,191,932.6 2,192,026.7 3,995,109.0 2,070,319.2 3,749,517.1 1,935,229.3 (iii) Unsecured debt 85,267.0 85,267.0 56,822.6 56,822.6 72,136.1 72,136.1 68,705.7 68,705.7 63,032.2 63,032.2 4. Secured wholesale funding N.A. - N.A. - N.A. N.A. N.A. N.A. N.A. N.A. 5. Additional requirements, of which: 623,174.6 154,427.4 513,975.8 148,357.8 716,876.0 162,208.0 690,348.1 168,378.3 613,926.0 154,406.3 (i) Outflows related to derivative exposures and other collateral requirements 88,848.6 88,848.6 92,369.7 92,369.7 87,401.7 87,401.7 88,905.1 88,905.1 84,403.4 84,403.4 (ii) Outflows related to loss of funding on debt products 74.4 74.4 86.6 86.6 70.0 70.0 77.3 77.3 80.4 80.4 (iii) Credit and liquidity facilities 534,251.6 65,504.4 421,519.5 55,901.5 629,404.3 74,736.3 601,365.7 79,395.9 529,442.2 69,922.5 6. Other contractual funding obligations 316,201.2 316,201.2 292,688.8 292,688.8 318,432.6 318,432.6 304,873.2 304,873.2 303,366.3 303,366.3 7. Other contingent funding obligations 6,586,070.8 293,536.9 5,190,402.8 230,232.1 6,180,363.2 273,730.5 5,805,275.6 258,064.1 5,539,350.5 245,523.1 8. Total cash outflows N.A 3,833,003.3 N.A. 3,156,565.9 N.A. 3,683,495.6 N.A. 3,512,167.1 N.A. 3,314,517.3 9. Secured lending (e.g. reverse repos) 26,034.3 0.0 22,171.3 5.7 15,347.9 2.5 37,416.2 N.A 20,083.5 N.A 10. Inflows from fully performing exposures 737,350.0 526,547.6 629,818.6 458,616.6 702,047.1 505,674.3 656,884.8 469,450.9 608,722.5 429,040.1 11. Other cash inflows 145,572.1 99,032.2 132,222.9 92,103.8 139,668.2 93,663.6 140,565.3 95,838.8 132,005.1 89,190.1 12. Total cash inflows 908,956.4 625,579.8 784,212.8 550,726.1 857,063.2 599,340.4 834,866.3 565,289.7 760,811.1 518,230.2 13. Total HQLA N.A. 3,940,112.5 N.A. 3,234,595.5 N.A. 3,720,001.9 N.A. 3,610,698.8 N.A. 3,462,355.8 14. Total net cash outflows (8)-(12) N.A. 3,207,423.5 N.A. 2,605,839.8 N.A. 3,084,155.2 N.A. 2,946,877.4 N.A. 2,796,287.1 15. Liquidity coverage ratio (%) N.A. 122.84% N.A. 124.13% N.A. 120.62% N.A. 122.53% N.A. 123.82% Annual Report 2023-24 | 181 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Liquidity of the Bank is managed by the Asset Liability Management Group (ALMG) under the central oversight of the Asset Liability Management Committee (ALCO). For the domestic operations of the Bank, ALMG-India is responsible for the overall management of liquidity. For the overseas branches of the Bank, a decentralised approach is followed for day-to-day liquidity management, while a centralised approach is followed for long-term funding in co-ordination with Head-Office. Liquidity in the overseas branches is maintained taking into consideration both host country and the RBI regulations. HQLA primarily includes government securities in excess of minimum statutory liquidity ratio (SLR) and to the extent allowed under marginal standing facility (MSF) and facility to avail liquidity for LCR (FALLCR) of ` 3,538,601.0 million at March 31, 2024 (March 31, 2023: ` 2,753,045.5 million). As per the RBI guidelines, the carve-out from SLR under FALLCR was 16.0% of Net Demand and Time Liabilities (NDTL) for Marginal Standing Facility (MSF), it was 2.0% of NDTL. Additionally, cash, balance in excess of cash reserve requirement with RBI and balances with central banks at our overseas branches locations amounted to ` 215,857.4 million at March 31, 2024 (March 31, 2023: ` 320,660.8 million). Further, average level 2 assets, primarily consisting of AA- and above rated corporate bonds and commercial papers, amounted to ` 146,666.4 million at March 31, 2024 (March 31, 2023: ` 127,857.7 million). At March 31, 2024, top liability products/instruments and their percentage contribution to the total liabilities of the Bank were term deposits of 43.65% (March 31, 2023: 40.37%), savings account deposits of 21.49% (March 31, 2023: 23.97%), current account deposits of 10.34% (March 31, 2023: 10.19%) and bond borrowings of 3.33% (March 31, 2023: 4.26%). Top 20 depositors comprised 3.44% of the total deposits of the Bank at March 31,2024 (March 31, 2023: 3.47%). Further, the total borrowings mobilised from significant counterparties (from whom the funds borrowed were more than 1.00% of the Bank’s total liabilities) were 1.43% of the total liabilities of the Bank at March 31, 2024 (March 31, 2023: 2.48%). The weighted cash outflows are primarily driven by unsecured wholesale funding which includes non-operational deposits and unsecured debt. During the three months ended March 31, 2024, unsecured wholesale funding contributed 62.08% (March 31, 2023: 60.57%) of the total weighted cash outflows. The non-operational deposits include term deposits with premature withdrawal facility. Retail deposits including deposits from small business customers and other contingent funding obligations constituted 17.99% (March 31, 2023: 18.17%) and 7.66% (March 31, 2023: 7.29%) of the total weighted cash outflows, respectively. The other contingent funding obligations primarily included bank guarantees (BGs) and letters of credit (LCs) issued on behalf of the Bank’s clients. In view of the margin rules for non-centrally cleared derivative transactions issued by the Basel Committee on Banking Supervision and discussion paper issued by the RBI, certain derivative transactions would be subject to margining and consequent collateral exchange would be as governed by Credit Support Annex (CSA). The Bank has entered into CSAs which would require maintenance of collateral. The Bank considers the increased liquidity requirement on account of valuation changes in the transactions settled through Qualified Central Counterparties (QCCP) in India including the Clearing Corporation of India (CCIL) and other exchange houses as well as for transactions covered under CSAs. The potential outflows on account of such transactions have been considered based on the look-back approach prescribed in the RBI guidelines. The average LCR of the Bank for the three months ended March 31, 2024 was 122.84 % (March 31, 2023: 124.13%). The Bank also monitors the LCR in US Dollar currency which was the only significant currency, other than Indian Rupee, as it constituted more than 5.00% of the balance sheet size of the Bank during the year ended March 31, 2024. 182 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 5. Information about business and geographical segments Business Segments Pursuant to the guidelines issued by RBI on AS 17 - Segment Reporting, the following business segments have been reported. • Retail Banking includes exposures which satisfy the four criteria of orientation, product, granularity and low value of individual exposures for retail exposures laid down in Basel Committee on Banking Supervision (BCBS) document ‘International Convergence of Capital Measurement and Capital Standards: A Revised Framework’. This segment also includes income from credit cards, debit cards, third party product distribution and the associated costs. • Wholesale Banking includes all advances to trusts, partnership firms, companies and statutory bodies, which are not included under Retail Banking. • Treasury includes the entire investment and derivative portfolio of the Bank. • Other Banking includes leasing operations and other items not attributable to any particular business segment. • Unallocated includes items such as tax paid in advance net of provision, deferred tax and provisions to the extent reckoned at the entity level. Income, expenses, assets and liabilities are either specifically identified with individual segments or are allocated to segments on a systematic basis. All liabilities are transfer priced to a central treasury unit, which pools all funds and lends to the business units at appropriate rates based on the relevant maturity of assets being funded after adjusting for regulatory reserve requirements. The transfer pricing mechanism of the Bank is periodically reviewed. The segment results are determined based on the transfer pricing mechanism prevailing for the respective reporting periods. The following tables set forth, for the periods indicated, the business segment results on this basis. ` in million Sr. No. Particulars For the year ended March 31, 2024 Retail Banking Wholesale Banking Treasury Other Banking Business Total 1. Revenue 1,345,475.7 717,802.2 1,139,592.2 32,973.0 3,235,843.1 2. Less: Inter-segment revenue 1,577,356.0 3. Total revenue (1)–(2) 1,658,487.1 4. Segment results 188,491.7 199,717.1 148,984.0 7,685.5 544,878.3 5. Unallocated expenses - 6. Operating profit 4)-(5) 544,878.3 7. Income tax expenses (including deferred tax credit) 135,995.6 8. Net profit/(loss) (6)-(7) 408,882.7 9. Segment assets 7,193,136.2 4,824,561.0 6,282,561.4 348,914.4 18,649,173.0 10. Unallocated assets 65,972.8 11. Total assets (9)+(10) 18,715,145.8 12. Segment liabilities 10,198,454.9 4,565,715.3 3,757,855.61 62,120.0 18,584,145.8 13. Unallocated liabilities 131,000.0 14. Total liabilities (12)+(13) 18,715,145.8 15. Capital expenditure 19,984.4 7,806.3 1,390.0 461.2 29,641.9 16. Depreciation 10,978.1 4,596.4 788.2 263.8 16,626.5 1. Includes share capital and reserves and surplus. Annual Report 2023-24 | 183 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 'RBI’s Master Direction on Financial Statements – Presentation and Disclosures, requires to sub-divide ‘Retail banking’ into (a) Digital Banking (as defined in RBI circular on Establishment of Digital Banking Units dated April 7, 2022) and (b) Other Retail Banking segment. Accordingly, the segmental results for retail banking segment for the year ended March 31, 2024 is sub-divided as below: ` in million Sr. No. Particulars Segment revenue Segment results Segment assets Segment liabilities Capital expenditure Depreciation Retail Banking 1,345,475.7 188,491.7 7,193,136.2 10,198,454.9 19,984.4 10,978.1 (i) Digital Banking 324,426.1 50,169.4 1,314,019.0 1,855,596.4 1,313.3 721.4 (ii) Other Retail Banking 1,021,049.6 138,322.3 5,879,117.2 8,342,858.5 18,671.1 10,256.7 ` in million Sr. No. Particulars For the year ended March 31, 2023 Retail Banking Wholesale Banking Treasury Other Banking Business Total 1. Revenue 1,037,753.4 506,148.5 847,707.4 23,830.6 2,415,439.9 2. Less: Inter-segment revenue 1,124,812.0 3. Total revenue (1)–(2) 1,290,627.9 4. Segment results 175,336.8 157,857.8 142,715.5 4,802.2 480,712.3 5. Unallocated expenses 56,500.0 6. Operating profit 4)-(5) 424,212.3 7. Income tax expenses (including deferred tax credit) 105,247.3 8. Net profit/(loss) (6)-(7) 318,965.0 9. Segment assets 6,039,593.7 4,328,743.5 5,084,697.5 297,915.4 15,750,950.1 10. Unallocated assets 91,116.4 11. Total assets (9)+(10) 15,842,066.5 12. Segment liabilities 8,913,545.4 3,472,764.9 3,299,563.51 25,192.7 15,711,066.5 13. Unallocated liabilities 131,000.0 14. Total liabilities (12)+(13) 15,842,066.5 15. Capital expenditure 11,682.9 5,251.8 610.6 277.0 17,822.3 16. Depreciation 9,274.5 3,427.2 335.8 210.4 13,247.9 1. Includes share capital and reserves and surplus. 'RBI’s Master Direction on Financial Statements – Presentation and Disclosures, requires to sub-divide ‘Retail banking’ into (a) Digital Banking (as defined in RBI circular on Establishment of Digital Banking Units dated April 7, 2022) and (b) Other Retail Banking segment. Accordingly, the segmental results for retail banking segment for the three months ended March 31, 2023 is sub-divided as below: ` in million Sr. No. Particulars Segment revenue Segment results Segment assets Segment liabilities Capital expenditure Depreciation Retail Banking 287,393.4 49,026.3 6,039,593.7 8,913,545.4 2,799.1 2,513.2 (i) Digital Banking 64,748.7 15,354.8 941,323.5 1,306,703.2 141.5 128.6 (ii) Other Retail Banking 222,644.7 33,671.5 5,098,270.2 7,606,842.2 2,657.6 2,384.6 184 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Geographical segments The Bank reports its operations under the following geographical segments. Domestic operations comprise branches in India. Foreign operations comprise branches outside India and offshore banking units in India. The following tables set forth, for the periods indicated, geographical segment results. ` in million Revenues Year ended March 31, 2024 Year ended March 31, 2023 Domestic operations 1,612,412.0 1,257,715.6 Foreign operations 46,075.1 32,912.3 Total 1,658,487.1 1,290,627.9 ` in million Assets1 At March 31, 2024 At March 31, 2023 Domestic operations 17,969,093.4 15,019,154.1 Foreign operations 680,079.6 731,796.0 Total 18,649,173.0 15,750,950.1 1. Segment assets do not include tax paid in advance/tax deducted at source (net) and deferred tax assets (net). The following table sets forth, for the periods indicated, capital expenditure and depreciation thereon for the geographical segments. ` in million Particulars Capital expenditure incurred during Depreciation provided during Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2024 Year ended March 31, 2023 Domestic operations 29,501.7 17,672.8 16,537.3 13,164.4 Foreign operations 140.2 149.5 89.2 83.5 Total 29,641.9 17,822.3 16,626.5 13,247.9 Annual Report 2023-24 | 185 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 6. Maturity pattern The following table sets forth, the maturity pattern of assets and liabilities of the Bank at March 31, 2024. ` in million Maturity buckets Loans & Advances1 Investment securities1 Deposits1 Borrowings1 Total foreign currency assets2 Total foreign currency liabilities2 Day 1 15,713.4 1,620,875.2 224,391.8 1,192.4 207,489.7 9,445.9 2 to 7 days 117,015.6 122,900.5 878,485.9 5,658.2 154,558.8 42,072.9 8 to 14 days 118,591.0 104,055.1 311,589.7 9,954.9 21,681.0 34,131.4 15 to 30 days 339,446.5 198,267.7 388,405.4 55,835.2 92,327.1 91,670.5 31 days to 2 months 474,575.6 177,955.7 459,661.2 74,866.3 132,307.5 75,297.9 2 to 3 months 447,832.2 122,764.1 442,972.9 52,365.5 96,619.9 67,312.5 3 to 6 months 741,381.0 199,852.8 840,735.5 205,182.9 159,443.8 160,196.1 6 months to 1 year 1,262,205.0 258,661.0 1,270,083.1 143,072.1 142,133.0 108,261.3 1 to 3 years 3,320,361.6 390,283.3 1,696,508.0 331,565.7 37,391.0 179,845.9 3 to 5 years 2,357,173.1 620,778.9 3,826,005.6 126,448.7 16,983.1 44,690.8 Above 5 years 2,649,768.9 803,028.4 3,789,410.4 243,533.9 51,573.3 39,559.5 Total 11,844,063.9 4,619,422.7 14,128,249.5 1,249,675.8 1,112,508.2 852,484.7 1. Includes foreign currency balances. 2. Excludes off-balance sheet assets and liabilities. The following table sets forth, the maturity pattern of assets and liabilities of the Bank at March 31, 2023. ` in million Maturity buckets Loans & Advances1 Investment securities1 Deposits1 Borrowings1 Total foreign currency assets2 Total foreign currency liabilities2 Day 1 10,042.4 1,245,694.5 127,754.2 - 35,349.4 1,637.6 2 to 7 days 116,565.8 113,368.4 564,803.8 21,086.7 474,567.6 50,108.9 8 to 14 days 95,999.8 67,409.4 228,411.9 10,111.6 68,969.2 24,821.5 15 to 30 days 239,586.3 111,274.4 194,054.5 16,811.4 61,989.4 38,634.4 31 days to 2 months 444,361.0 63,882.2 306,379.7 51,726.9 87,871.1 63,990.3 2 to 3 months 457,284.2 51,112.4 313,978.8 98,068.9 96,509.6 51,706.2 3 to 6 months 665,075.0 114,959.0 559,170.4 92,851.8 93,123.7 75,904.4 6 months to 1 year 1,081,144.6 190,744.3 901,157.0 179,973.3 79,832.7 91,177.0 1 to 3 years 2,883,348.7 397,446.1 1,588,983.4 324,902.8 89,170.3 205,213.2 3 to 5 years 1,891,304.2 576,828.0 3,521,292.8 130,609.0 18,342.9 45,168.3 Above 5 years 2,311,671.1 690,578.7 3,502,420.5 267,112.5 48,785.1 10,802.2 Total 10,196,383.1 3,623,297.4 11,808,407.0 1,193,254.9 1,154,511.0 659,164.0 1. Includes foreign currency balances. 2. Excludes off-balance sheet assets and liabilities. The estimates and assumptions used by the Bank for classification of assets and liabilities under the different maturity buckets are based on the returns submitted to RBI for the relevant periods. 186 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 7. Employee Stock Option Scheme (ESOS)/ Employees Stock Unit Scheme (ESUS) In terms of the ESOS, as amended, the maximum number of options granted to any eligible employee in a financial year shall not exceed 0.05% of the issued equity shares of the Bank at the time of grant of the options and aggregate of all such options granted to the eligible employees shall not exceed 10.0% of the aggregate number of the issued equity shares of the Bank on the date(s) of the grant of options in line with SEBI Regulations. Under the stock option scheme, eligible employees are entitled to apply for equity shares. In April 2016, exercise period was modified from 10 years from the date of grant or five years from the date of vesting, whichever is later, to 10 years from the date of vesting. In June 2017, exercise period was further modified to not exceed 10 years from the date of vesting of options as may be determined by the Board Governance, Remuneration & Nomination Committee to be applicable for future grants. In May 2018, exercise period was further modified to not exceed 5 years from the date of vesting of options as may be determined by the Board Governance, Remuneration & Nomination Committee to be applicable for future grants. Options granted after March 2014 vest in a graded manner over a three-year period with 30%, 30% and 40% of the grant vesting in each year, commencing from the end of 12 months from the date of grant other than certain options granted in April 2014 which vested to the extent of 50% on April 30, 2017 and the balance on April 30, 2018 and option granted in September 2015 which vested to the extent of 50% on April 30, 2018 and balance 50% vested on April 30, 2019. Options granted in January 2018 vested at the end of four years from the date of grant. Certain options granted in May 2018, vested to the extent of 50% on May 2021 and balance 50% on May 2022. Options granted prior to March 2014 except mentioned below, vested in a graded manner over a four-year period, with 20%, 20%, 30% and 30% of the grants vesting in each year, commencing from the end of 12 months from the date of grant. Options granted in April 2009 vested in a graded manner over a five-year period with 20%, 20%, 30% and 30% of grant vesting each year, commencing from the end of 24 months from the date of grant. Options granted in September 2011 vested in a graded manner over a five-year period with 15%, 20%, 20% and 45% of grant vesting each year, commencing from the end of 24 months from the date of the grant. The exercise price of the Bank’s options, except mentioned below, is the last closing price on the stock exchange, which recorded highest trading volume preceding the date of grant of options. In February 2011, the Bank granted 16,692,500 options to eligible employees and whole-time Directors of the Bank and certain of its subsidiaries at an exercise price of ` 175.82. This exercise price was the average closing price on the stock exchange during the six months ended October 28, 2010. Of these options granted, 50% vested on April 30, 2014 and the balance 50% vested on April 30, 2015. The Board of Directors at its Meeting held on June 28, 2022, approved the adoption of Employees Stock Unit Scheme - 2022 (Scheme 2022), which was subsequently approved by the shareholders at the Annual General Meeting held on August 30, 2022. As per the Scheme, maximum of 100,000,000 Employee stock units (units), shall be granted in one or more tranches over a period of 7 years from the date of approval of the Scheme 2022 by the shareholders. The maximum number of units granted to any eligible employee shall not exceed 20,000 units in any financial year and 0.14% of the total units available for grant over a period of seven years from the date of approval of the unit scheme by the shareholders. Units granted under the Scheme 2022 shall vest not later than the maximum vesting period of 4 years. Exercise price shall be the face value of equity shares of the Bank i.e. ` 2 for each unit (as adjusted for any changes in capital structure of the Bank). Units granted under the scheme vest in a graded manner over a three-year period with 30%, 30% and 40% of the grant vesting in each year, commencing from the end of 13 months from the date of grant. Exercise period of units is five years from the date of vesting, or such shorter period as may be determined by the Board Governance, Remuneration & Nomination Committee for each grant. Annual Report 2023-24 | 187 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The weighted average fair value, based on Black-Scholes model, of options granted during the year ended March 31, 2024 was ` 340.59 (year ended March 31, 2023: ` 291.15) and of units granted during the year ended March 31, 2024 was ` 879.43. The following table sets forth, for the periods indicated, the key assumptions used to estimate the fair value of options granted. Particulars Year ended March 31, 2024 Year ended March 31, 2023 Risk-free interest rate 6.88% to 7.32% 5.99% to 7.37% Expected term 3.23 to 5.23 years 3.23 to 5.23 years Expected volatility 24.78% to 37.41% 34.79% to 38.98% Expected dividend yield 0.56% to 0.85% 0.27% to 0.72% The following table sets forth, for the periods indicated, the key assumptions used to estimate the fair value of units granted. Particulars Year ended March 31, 2024 Risk-free interest rate 6.82% to 6.94% Expected term 1.58 to 3.58 years Expected volatility 23.63% to 36.56% Expected dividend yield 0.56% Risk free interest rates over the expected term of the option/units are based on the government securities yield in effect at the time of the grant. The expected term of an option/units is estimated based on the vesting term as well as expected exercise behavior of the employees who receive the option/units. Expected exercise behavior is estimated based on the historical stock option/units exercise pattern of the Bank. Expected volatility during the estimated expected term of the option/units is based on historical volatility determined based on observed market prices of the Bank's publicly traded equity shares. Expected dividends during the estimated expected term of the option/units are based on recent dividend activity. The following table sets forth, for the periods indicated, the summary of the status of the Bank’s stock option plan. ` except number of options Particulars Stock options outstanding Year ended March 31, 2024 Year ended March 31, 2023 Number of options Weighted average exercise price Number of options Weighted average exercise price Outstanding at the beginning of the year 225,025,803 361.60 237,197,999 310.82 Add: Granted during the year 14,635,600 894.95 25,793,500 747.92 Less: Lapsed during the year, net of re‑issuance 1,410,025 728.44 3,921,340 568.36 Less: Exercised during the year 39,519,912 296.27 34,044,356 276.72 Outstanding at the end of the year 198,731,466 411.26 225,025,803 361.60 Options exercisable 159,296,026 324.55 172,938,533 289.69 188 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, the summary of stock options outstanding at March 31, 2024. Range of exercise price (` per share) Number of shares arising out of options Weighted average exercise price (` per share) Weighted average remaining contractual life (Number of years) 60-199 4,012,005 161.88 1.25 200-399 115,605,713 267.72 3.54 400-599 42,086,634 483.18 3.22 600-799 22,668,214 747.64 5.20 800-899 14,358,900 894.81 6.16 The following table sets forth, the summary of stock options outstanding at March 31, 2023. Range of exercise price (` per share) Number of shares arising out of options Weighted average exercise price (` per share) Weighted average remaining contractual life (Number of years) 60-199 7,202,993 160.84 1.85 200-399 145,129,078 267.52 4.37 400-599 48,347,432 479.32 4.15 600-799 24,274,900 747.62 6.17 800-899 71,400 862.88 6.58 The following table sets forth, for the periods indicated, the summary of the status of the Bank’s stock unit plan. ` except number of units Particulars Stock Units outstanding Year ended March 31, 2024 Year ended March 31, 2023 Number of units Weighted average exercise price Number of units Weighted average exercise price Outstanding at the beginning of the year - - - - Add: Granted during the year 4,419,670 2.00 - - Less: Lapsed during the year, net of re-issuance 228,860 2.00 - - Less: Exercised during the year - - - - Outstanding at the end of the year 4,190,810 2.00 - - Units exercisable 2,700 2.00 - - At March 31, 2024, the weighted average remaining contractual life of stock units outstanding was 6.24 years. The options were exercised regularly throughout the period and weighted average share price as per National Stock Exchange price volume data during the year ended March 31, 2024 was ` 972.60 (year ended March 31, 2023: ` 832.00). 8. Subordinated debt During the year ended March 31, 2024, the Bank has not raised subordinated debt bonds qualifying for Additional Tier-1 capital (March 31, 2023: Nil) and subordinated debt qualifying for Tier-2 capital (March 31, 2023: Nil). Annual Report 2023-24 | 189 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 9. Repurchase transactions The following tables set forth for the periods indicated, the details of securities sold and purchased under repo and reverse repo transactions respectively including transactions under Liquidity Adjustment Facility (LAF) and Marginal Standing Facility (MSF). ` in million Sr. No. Particulars Minimum outstanding balance during the Maximum outstanding balance during the Daily average outstanding balance during the Outstanding balance at March 31, 2024 Year ended March 31, 2024 Securities sold under Repo, LAF and MSF i) Government Securities - 266,852.1 139,377.7 - ii) Corporate Debt Securities - - - - iii) Any other securities - - - - Securities purchased under Reverse Repo and LAF i) Government Securities - 255,318.1 22,778.8 122,381.1 ii) Corporate Debt Securities - - - - iii) Any other securities - - - - 1. Amounts reported are based on face value of securities under Repo and Reverse repo. 2. Amounts reported are based on lending/borrowing amount under tri-party repo, LAF and MSF. ` in million Sr. No. Particulars Minimum outstanding balance during the Maximum outstanding balance during the Daily average outstanding balance during the Outstanding balance at March 31, 2023 Year ended March 31, 2023 Securities sold under Repo, LAF and MSF i) Government Securities - 244,318.8 137,385.3 - ii) Corporate Debt Securities - 1,000.0 2.7 - iii) Any other securities - - - - Securities purchased under Reverse Repo and LAF i) Government Securities - 660,560.0 101,231.3 - ii) Corporate Debt Securities - 4,250.0 88.4 - iii) Any other securities - - - - 1. Amounts reported are based on face value of securities under Repo and Reverse repo. 2. Amounts reported are based on lending/borrowing amount under tri-party repo, LAF and MSF 190 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 10. Composition of investments The following table sets forth, the composition of investments of the Bank at March 31, 2024. ` in million Investments in India Investments outside India Total Investments Government Securities Other Approved Securities Shares Debentures and Bonds Subsidiaries and/or joint ventures Others Total investments in India Government securities (including local authorities) Subsidiaries and/or joint ventures Others Total Investments outside India Held to Maturity Gross 2,937,502.4 - 54.7 - 77,176.8 4,292.0 3,019,025.9 - 19,698.9 205.6 19,904.5 3,038,930.4 Less: Provision for non- performing investments (NPI) - - 54.7 - - 3,718.6 3,773.3 - - 67.2 67.2 3,840.6 Net 2,937,502.4 - - - 77,176.8 573.4 3,015,252.5 - 19,698.9 138.3 19,837.2 3,035,089.8 Available for Sale Gross 625,156.5 - 56,075.2 185,850.8 19,976.6 206,721.3 1,093,780.4 6,770.6 - 20,848.2 27,618.8 1,121,399.2 Less: Provision for depreciation and NPI - - 30,037.6 6,426.5 - 19,730.2 56,194.2 - - 3,797.6 3,797.6 59,991.9 Net 625,156.5 - 26,037.6 179,424.4 19,976.6 186,991.1 1,037,586.2 6,770.6 - 17,050.6 23,821.2 1,061,407.3 Held for Trading Gross 193,296.5 - 758.9 293,225.0 - 2,566.6 489,847.0 33,078.6 - - 33,078.6 522,925.6 Less: Provision for depreciation and NPI - - - - - - - - - - - - Net 193,296.5 - 758.9 293,225.0 - 2,566.6 489,847.0 33,078.6 - - 33,078.6 522,925.6 Total Investments 3,755,955.3 - 56,888.8 479,075.9 97,153.4 213,579.8 4,602,653.2 39,849.3 19,698.9 21,053.8 80,602.0 4,683,255.2 Less: Provision for non- performing investments - - 54.7 - - 3,718.6 3,773.3 - - 67.2 67.2 3,840.5 Less: Provision for depreciation and NPI - - 30,037.6 6,426.5 - 19,730.2 56,194.2 - - 3,797.6 3,797.6 59,991.8 Net 3,755,955.3 - 26,796.6 472,649.4 97,153.4 190,131.0 4,542,685.7 39,849.3 19,698.9 17,188.9 76,737.1 4,619,422.7 Annual Report 2023-24 | 191 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, the composition of investments of the Bank at March 31, 2023. ` in million Investments in India Investments outside India Total Investments Government Securities Other Approved Securities Shares Debentures and Bonds Subsidiaries and/or joint ventures Others Total investments in India Government securities (including local authorities) Subsidiaries and/or joint ventures Others Total Investments outside India Held to Maturity Gross 2,462,155.4 - 54.7 - 48,937.6 4,285.7 2,515,433.4 - 19,698.9 279.5 19,978.4 2,535,411.8 Less: Provision for non- performing investments (NPI) - - 54.7 - - - 54.7 - - - - 54.7 Net 2,462,155.4 - - - 48,937.6 4,285.7 2,515,378.7 - 19,698.9 279.5 19,978.4 2,535,357.1 Available for Sale Gross 573,450.5 - 51,424.6 214,257.2 19,976.5 119,517.2 978,626.0 3,595.4 - 22,532.2 26,127.6 1,004,753.6 Less: Provision for depreciation and NPI - - 29,712.7 9,748.5 - 18,015.9 57,477.1 - - 4,045.3 4,045.3 61,522.4 Net 573,450.5 - 21,711.9 204,508.7 19,976.5 101,501.3 921,148.9 3,595.4 - 18,486.9 22,082.3 943,231.2 Held for Trading Gross 22,166.9 - - 83,585.4 - - 105,752.3 38,794.0 - 162.8 38,956.8 144,709.1 Less: Provision for depreciation and NPI - - - - - - - - - - - - Net 22,166.9 - - 83,585.4 - - 105,752.3 38,794.0 - 162.8 38,956.8 144,709.1 Total Investments 3,057,772.8 - 51,479.3 297,842.6 68,914.1 123,802.9 3,599,811.7 42,389.4 19,698.9 22,974.5 85,062.8 3,684,874.5 Less: Provision for non- performing investments - - 54.7 - - - 54.7 - - - - 54.7 Less: Provision for depreciation and NPI - - 29,712.7 9,748.5 - 18,015.9 57,477.1 - - 4,045.3 4,045.3 61,522.4 Net 3,057,772.8 - 21,711.9 288,094.1 68,914.1 105,787.0 3,542,279.9 42,389.4 19,698.9 18,929.2 81,017.5 3,623,297.4 192 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Securities kept as margin The following table sets forth, the face value of securities that are kept as margin are as under: ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 Securities kept as margin with Clearing Corporation of India towards (CCIL) i) Collateral and fund management-Securities Segment 38,500.0 26,050.0 ii) Collateral and fund management-Tri-Party Repo 351,650.0 356,050.0 iii) Default Fund-Forex Forward Segment 1,820.0 2,250.0 iv) Default Fund-Forex Settlement Segment 170.0 220.0 v) Default Fund-Rupee Derivatives (Guaranteed Settlement) Segment 820.0 1,920.0 vi) Default Fund-Securities Segment 270.0 120.0 vii) Default Fund-Tri-Party Repo Segment 150.0 150.0 Securities kept as margin with the RBI towards i) Real Time Gross Settlement (RTGS) - - ii) Repo Transactions 315,250.0 314,750.0 Securities kept with National Securities Clearing Corporation of India (NSCCIL) towards NSE Currency Derivative Segment 33,150.0 14,000.0 Securities kept with London clearing house (LCH) Clearnet Limited towards LCH Currency Derivative Segment - 9,531.7 11. Government Security lending transactions The Bank has not undertaken any government securities lending transactions during the year ended March 31, 2024 12. Movement of provisions for depreciation on investments and Investment Fluctuation Reserve The following table sets forth, for the period indicated, the movement of provisions for depreciation on investments and Investment Fluctuation Reserve of the Bank. ` in million except percentage Sr. No. Particulars At March 31, 2024 At March 31, 2023 A. Movement of provisions held towards depreciation on investments i) Opening balance 61,577.1 51,415.7 ii) Add: Provisions made during the year 9,701.3 14,688.5 iii) Less: Write-off/write-back of excess provisions during the year (7,445.9) (4,527.1) iv) Closing balance 63,832.5 61,577.1 B. Movement of Investment Fluctuation Reserve i) Opening balance 21,758.8 20,715.0 ii) Add: Amount transferred during the year 9,927.9 1,043.8 iii) Less: Drawdown - - iv) Closing balance 31,686.7 21,758.8 C. Closing balance in IFR as a percentage of closing balance of investments in AFS and HFT/Current category 2.00% 2.00% Annual Report 2023-24 | 193 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 13. Investment in securities, other than government and other approved securities (Non-SLR investments) i) Issuer composition of investments in securities, other than government and other approved securities The following table sets forth, the issuer composition of investments of the Bank in securities, other than government and other approved securities at March 31, 2024. ` in million Sr. No. Issuer Amount Extent of private placement Extent of ‘below investment grade’ securities Extent of ‘unrated’ securities2,4 Extent of ‘unlisted’ securities2,4 (a) (b) (c) (d) 1. PSUs 98,663.0 70,479.8 - - 42,070.0 2. FIs 84,963.6 60,519.6 642.8 674.2 102.9 3. Banks 99,436.3 28,915.9 1,085.2 - 2,394.1 4. Private corporates 272,182.5 225,008.6 3,595.0 1,008.9 3,404.7 5. Subsidiaries/ Joint ventures 116,852.3 5,525.3 - - - 6. Others3,4 255,202.1 213,052.6 18,634.95 - - 7. Provision held towards depreciation (63,832.4) - - - - Total 863,467.4 603,501.7 23,957.9 1,683.1 47,971.7 1. Amounts reported under columns (a), (b), (c) and (d) above are not mutually exclusive. 2. Excludes equity shares, units of equity-oriented mutual fund, units of venture capital fund, pass through certificates, security receipts, commercial papers, certificates of deposit, non-convertible debentures (NCDs) with original or initial maturity up to one year issued by corporate (including NBFC), unlisted convertible debentures and securities acquired by way of conversion of debt. 3. Includes investments in non-Indian government securities by overseas branches amounting to ` 39,849.3 million. 4. Excludes investments in non-SLR Government of India securities amounting to ` 212.2 million. 5. Represents security receipts. The following table sets forth, the issuer composition of investments of the Bank in securities, other than government and other approved securities at March 31, 2023. ` in million Sr. No. Issuer Amount Extent of private placement Extent of ‘below investment grade’ securities Extent of ‘unrated’ securities2,4 Extent of ‘unlisted’ securities2,4 (a) (b) (c) (d) 1. PSUs 34,991.4 15,118.9 - - 4,920.0 2. FIs 76,392.3 54,146.0 797.0 181.8 - 3. Banks 21,652.3 13,341.1 1,069.2 - 2,358.7 4. Private corporates 237,340.3 200,086.4 2,965.0 695.0 13,375.7 5. Subsidiaries/ Joint ventures 88,613.0 5,525.3 - - - 6. Others3,4 168,112.2 125,722.9 20,098.25 - - 7. Provision held towards depreciation (61,577.1) - - - - Total 565,524.4 413,940.6 24,929.4 876.8 20,654.4 1. Amounts reported under columns (a), (b), (c) and (d) above are not mutually exclusive. 2. Excludes equity shares, units of equity-oriented mutual fund, units of venture capital fund, pass through certificates, security receipts, commercial papers, certificates of deposit, non-convertible debentures (NCDs) with original or initial maturity up to one year issued by corporate (including NBFC), unlisted convertible debentures and securities acquired by way of conversion of debt. 3. Includes investments in non-Indian government securities by overseas branches amounting to ` 42,389.4 million 4. Excludes investments in non-SLR Government of India securities amounting to ` 81.0 million. 5. Represents security receipts. 194 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ii) Non-performing investments in securities, other than government and other approved securities The following table sets forth, for the periods indicated, the movement in gross non-performing investments in securities, other than government and other approved securities. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening balance 44,916.2 40,891.6 Additions during the year 4,007.7 10,106.1 Reduction during the year (14,172.8) (6,081.5) Closing balance 34,751.1 44,916.2 Total provision held 33,478.7 40,394.6 14. Sales and transfers of securities to/from Held to Maturity (HTM) category During the year ended March 31, 2024 and March 31, 2023, the value of sales/transfers of securities to/from HTM category did not exceed 5.0% of the book value of investments held in HTM category at the beginning of the year. Sales and transfers of securities to/from HTM category does not include one-time transfer of securities, direct sales from HTM for bringing down SLR holdings consequent to a downward revision in SLR requirements by RBI, sales to RBI under open market operation auctions and government securities acquisition programme, repurchase of government securities by Government of India and state development loans by concerned state government under buyback or switch operations and additional shifting of securities explicitly permitted by RBI. 15. Derivatives The Bank is a participant in the financial derivatives market. The Bank deals in derivatives for balance sheet management, proprietary trading and market making purposes whereby the Bank offers derivative products to its customers, enabling them to hedge their risks. Dealing in derivatives is carried out by identified groups in the treasury of the Bank based on the purpose of the transaction. Derivative transactions are entered into by the treasury front office. Treasury and Securities Service Group (TSSG) conducts an independent check of the transactions entered into by the front office and also undertakes activities such as confirmation, settlement, accounting, risk monitoring and reporting and ensures compliance with various internal and regulatory guidelines. The market making and the proprietary trading activities in derivatives are governed by the Investment policy and Derivative policy of the Bank, which lays down the position limits, stop loss limits as well as other risk limits. The Risk Management Group (RMG) lays down the methodology for computation and monitoring of risk. The Risk Committee of the Board (RCB) reviews the Bank’s risk management policy in relation to various risks including credit and recovery policy, investment policy, derivative policy, asset liability management (ALM) policy and operational risk management policy. The RCB comprises independent directors and the Executive Director of the Bank. The Bank measures and monitors risk of its derivatives portfolio using such risk metrics as Value at Risk (VaR), stop loss limits and relevant greeks for options. Risk reporting on derivatives forms an integral part of the management information system. The use of derivatives for hedging purposes is governed by the hedge policy approved by ALCO. Subject to prevailing RBI guidelines, the Bank deals in derivatives for hedging fixed rate, floating rate or foreign currency assets/liabilities. Transactions for hedging and market making purposes are recorded separately. For hedge transactions, the Bank identifies the hedged item (asset or liability) at the inception of the hedge itself. The effectiveness is assessed at the time of inception of the hedge and periodically thereafter. Based on RBI circular issued on June 26, 2019, the accounting of hedge relationships established after June 26, 2019 is in accordance with the Guidance note on Accounting for Derivative Contracts issued by ICAI. The swaps Annual Report 2023-24 | 195 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) under hedge relationships established prior to that date are accounted for on an accrual basis and are not marked to market unless their underlying transaction is marked-to-market. Gains or losses arising from hedge ineffectiveness, if any, are recognised in the profit and loss Account. The premium on option contracts is accounted for as per Foreign Exchange Dearlers Association of India (FEDAI) guidelines. Over the counter (OTC) derivative transactions are covered under International Swaps and Derivatives Association (ISDA) master agreements with the respective counter parties. The exposure on account of derivative transactions is computed as per RBI guidelines. The Board of Directors has authorised ALCO to review and approve matters, as applicable, pertaining to the LIBOR transition to alternate risk free rates. A LIBOR Working Group has been constituted which reviews the progress on the international front, and the work carried out alongside Indian Banking Association (IBA). An update on the activities on the LIBOR transition and the proceedings of the Working Group are presented quarterly to ALCO. The necessary changes were implemented in the treasury system of the Bank to handle the transition of existing trades to the alternate risk free rates. The transition was carried out for the LIBORs (GBP, JPY, EUR, CHF) that ceased on December 31, 2021 and USD LIBORs ceased on June 2023 (except for trades whose last fixing was prior to June 2023 will continue as USD LIBOR linked trades till expiry). The following tables set forth, for the periods indicated, the details of derivative positions. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 Currency derivative1 Interest rate derivative2 Currency derivative1 Interest rate derivative2 1. Derivatives (Notional principal amount) For hedging - 396,997.5 - 364,145.0 For trading 3,382,695.6 24,958,775.3 1,662,275.0 23,627,386.6 2. Marked to market positions (net)3 (25,200.9) 8,345.0 (13,368.4) 9,074.0 a) Asset (+) 28,190.6 92,915.5 36,738.3 97,204.6 b) Liability (-) (53,391.5) (84,570.5) (50,106.7) (88,130.6) 3. Credit exposure4 102,347.4 307,963.8 104,371.8 291,761.7 4. Likely impact of one percentage change in interest rate (100*PV01)5 On hedging derivatives6 - 7,648.7 - 7,813.2 On trading derivatives 849.9 11,203.5 1,467.5 10,770.6 5. Maximum and minimum of 100*PV01 observed during the period a) On hedging6 Maximum - 9,145.2 - 9,327.0 Minimum - 6,944.4 - 5,937.8 b) On trading Maximum 1,499.0 13,061.3 2,948.6 11,379.1 Minimum 849.8 10,631.0 1,416.4 1,489.8 1. Exchange traded and OTC options, cross currency interest rate swaps and currency futures are included in currency derivatives. 2. OTC interest rate options, interest rate swaps, forward rate agreements, swaptions and exchange traded interest rate derivatives are included in interest rate derivatives. 3. For trading portfolio including accrued interest. 4. Includes accrued interest and has been computed based on current exposure method. 5. Amounts given are absolute values on a net basis, excluding options. 6. The swap contracts entered into for hedging purpose would have an opposite and off-setting impact with the underlying on- balance sheet items. 196 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following tables set forth, for the periods indicated, the details of Foreign exchange contracts. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 Trading Non-trading Trading Non-trading 1. Foreign exchange contracts (Notional principal amount) 15,338,457.5 261,764.4 14,350,624.0 979,594.1 2. Marked to market positions (net) 3,888.0 312.2 467.4 (1,077.4) 1. Asset (+) 24,402.1 419.4 24,154.1 2,154.3 2. Liability (-) (20,514.1) (107.2) (23,686.7) (3,231.7) 3. Credit exposure1 373,396.2 5,654.7 366,783.1 27,480.1 4. Likely impact of one percentage change in interest rate (100*PV01)2 63.8 4.2 38.9 26.5 1. Computed as per RBI Master Circular on Exposure Norms dated July 1, 2015. 2. Amounts given are absolute values on a net basis. As per the Master circular on Basel III Capital Regulations issued by RBI on April 1, 2022 on capital adequacy computation, ‘Banks in India shall adopt the comprehensive approach, which allows fuller offset of collateral against exposures, by effectively reducing the exposure amount by the value ascribed to the collateral’. Therefore, counterparty exposure has been fully off-set against the collateral received from the counterparty. The excess collateral posted over the net MTM payable was reckoned as exposure till FY2023. Since the collateral received is counterparty-wise and not product-wise, the derivative exposure reported above has not been adjusted for the collateral received/posted. At March 31, 2024, collateral utilised against the exposure was ` 19,378.6 million (March 31, 2023: ` 11,761.9 million), excess collateral posted over the exposure was ` 63.5 million (March 31, 2023: ` 1,118.2 million) and the net credit exposure on foreign exchange and derivatives, subsequent to collateral netting, was ` 770,046.9 million (March 31, 2023: ` 779,752.9 million). The net overnight open position (NOOP) at March 31, 2024 (as per last NOOP value reported to RBI for the year ended March 31, 2024) was ` 1,980.0 million (March 31, 2023: ` 4,710.8 million). The Bank has no exposure in credit derivative instruments (funded and non-funded) including credit default swaps (CDS) and principal protected structures at March 31, 2024 (March 31, 2023: Nil). 16. Exchange traded interest rate derivatives and currency derivatives Exchange traded interest rate derivatives The following table sets forth, for the periods indicated, the details of exchange traded interest rate derivatives. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 1. Notional principal amount of exchange traded interest rate derivatives undertaken during the year -10 year Government Security Notional Bond - - 2. Notional principal amount of exchange traded interest rate derivatives outstanding - 10 year Government Security Notional Bond - - 3. Notional principal amount of exchange traded interest rate derivatives outstanding and not ‘highly effective’ N.A. N.A. 4. Mark-to-market value of exchange traded interest rate derivatives outstanding and not ‘highly effective’ N.A. N.A. Annual Report 2023-24 | 197 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Exchange traded currency derivatives The following table sets forth, for the periods indicated, the details of exchange traded currency derivatives. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 1. Notional principal amount of exchange traded currency derivatives undertaken during the year 3,188,224.8 2,582,348.5 2. Notional principal amount of exchange traded currency derivatives options outstanding 108,219.1 37,567.3 3. Notional principal amount of exchange traded currency derivatives outstanding and not ‘highly effective’ NA N.A. 4. Mark-to-market value of exchange traded currency derivatives outstanding and not ‘highly effective’ NA N.A. 17. Forward rate agreement (FRA)/Interest rate swaps (IRS)/Cross currency swaps (CCS) The Bank enters into FRA, IRS and CCS contracts for balance sheet management and market making purposes whereby the Bank offers derivative products to its customers to enable them to hedge their interest rate risk and currency risk within the prevalent regulatory guidelines. A FRA is a financial contract between two parties to exchange interest payments for ‘notional principal’ amount on settlement date, for a specified period from start date to maturity date. Accordingly, on the settlement date cash payments based on contract rate and the settlement rate, which is the agreed bench-mark/reference rate prevailing on the settlement date, are made by the parties to one another. An IRS is a financial contract between two parties exchanging or swapping a stream of interest payments for a ‘notional principal’ amount on multiple occasions during a specified period. The Bank deals in interest rate benchmarks like Mumbai Inter-Bank Offered Rate (MIBOR), Indian Government Securities Benchmark Rate (INBMK), Mumbai Inter-Bank Forward Offer Rate (MIFOR) and Alternative Reference Rates (ARR) like Sterling Overnight Index Average (SONIA), Secured Overnight Financing Rate (SOFR) and Tokyo Overnight Average Rate (TONAR) etc. A CCS is a financial contract between two parties exchanging interest payments and principal, wherein interest payments and principal in one currency would be exchanged for interest payments and principal in another currency. These contracts are subject to the risks of changes in market interest rates and currency rates as well as the settlement risk with the counterparties. The following table sets forth, for the periods indicated, the details of the FRA/IRS contracts. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 1 Notional principal of FRA/IRS 25,351,178.5 23,972,449.0 2 Losses which would be incurred if all counter parties failed to fulfil their obligations under the agreement1 92,925.4 97,127.6 3 Collateral required by the Bank upon entering into FRA/IRS - - 4 Concentration of credit risk2 4,459.9 5,112.9 5 Fair value of FRA/IRS3 1,332.7 1,963.7 1. For trading portfolio both mark-to-market and accrued interest have been considered and for hedging portfolio only accrued interest has been considered. 2. Credit risk concentration is measured as the highest net receivable under these contracts from a particular counter party. 3. Fair value represents mark- to-market including accrued interest. 198 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, for the periods indicated, the details of the CCS. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 1. Notional principal of CCS1 541,254.0 564,630.0 2. Losses which would be incurred if all counter parties failed to fulfil their obligations under the agreement2 17,721.5 30,706.1 3. Collateral required by the Bank upon entering into CCS - - 4. Concentration of credit risk3 8,491.7 11,907.4 5. Fair value of CCS4 (16,936.1) (6,157.1) 1. CCS includes cross currency interest rate swaps and currency swaps. 2. For trading portfolio both mark-to-market and accrued interest have been considered and for hedging portfolio only accrued interest has been considered. 3. Credit risk concentration is measured as the highest net receivable under these contracts from a particular counter party. 4. Fair value represents mark-to-market including accrued interest. The following tables set forth, for the periods indicated, the nature and terms of FRA and IRS. Hedging ` in million Benchmark Type At March 31, 2024 At March 31, 2023 Notional principal No. of deals Notional principal No. of deals MIBOR Fixed receivable v/s Floating payable 271,890.0 52 240,890.0 47 USD LIBOR Fixed receivable v/s Floating payable - - 123,255.0 15 USD SOFR Fixed receivable v/s Floating payable 125,107.5 15 - - Total 396,997.5 67 364,145.0 62 Annual Report 2023-24 | 199 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Trading ` in million Benchmark Type At March 31, 2024 At March 31, 2023 Notional principal No. of deals Notional principal No. of deals Bond yield Sell FRA 92,205.0 262 78,803.6 224 CADCDOR Floating receivable v/s Fixed payable 565.9 1 678.3 1 CADCDOR Fixed receivable v/s Floating payable 565.9 1 678.3 1 EURESTR Fixed receivable v/s Floating payable 53,745.5 18 38,625.8 15 EURESTR Floating receivable v/s Fixed payable 56,670.8 22 41,076.1 19 EURIBOR Fixed receivable v/s Floating payable 16,257.4 30 11,849.0 30 EURIBOR Floating receivable v/s Fixed payable 17,731.5 18 13,697.0 20 GBPSONIA Floating receivable v/s Fixed payable 4,102.2 9 8,577.5 16 GBPSONIA Fixed receivable v/s Floating payable 3,180.4 7 5,209.4 11 INBMK Floating receivable v/s Fixed payable 1,000.0 1 1,000.0 1 INBMK Fixed receivable v/s Floating payable 1,000.0 1 1,000.0 1 JPYTONAR Floating receivable v/s Fixed payable 16,141.2 10 5,396.9 7 JPYTONAR Fixed receivable v/s Floating payable 15,946.4 10 5,852.0 7 MIBOR Fixed receivable v/s Floating payable 9,969,152.6 14,945 9,624,496.5 14,850 MIBOR Floating receivable v/s Fixed payable 9,916,916.5 14,091 9,754,197.8 14,677 MIFOR Fixed receivable v/s Floating payable - - 320,642.7 446 MIFOR Floating receivable v/s Fixed payable - - 251,471.2 257 MODMIFOR Floating receivable v/s Fixed payable 373,715.9 413 101,000.0 125 MODMIFOR Fixed receivable v/s Floating payable 475,494.2 551 172,100.0 191 OTHERS Fixed receivable v/s Fixed payable 23,918.2 6 6,289.7 6 T-BILL Floating receivable v/s Fixed payable 26,066.3 9 26,257.7 9 T-BILL Fixed receivable v/s Floating payable 69.9 1 5,104.9 2 USD SOFR v/s USD LIBOR Floating receivable v/s Floating payable - - 823.9 1 USDLIBOR Fixed receivable v/s Floating payable - - 449,837.7 411 USDLIBOR Floating receivable v/s Fixed payable - - 612,120.6 532 USDLIBOR Floating receivable v/s Floating payable - - 177,610.5 40 USDSOFR Fixed receivable v/s Floating payable 1,810,583.0 954 892,093.9 354 USDSOFR Floating receivable v/s Fixed payable 2,002,544.7 1,139 1,001,813.0 418 USDSOFR Floating receivable v/s Floating payable 76,607.5 23 - - Total 24,954,181.0 32,522 23,608,304.0 32,672 200 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following tables set forth, for the periods indicated, the nature and terms of CCS. Trading ` in million Benchmark Type At March 31, 2024 At March 31, 2023 Notional principal No. of deals Notional principal No. of deals EUR ESTR v/s USD SOFR Floating receivable v/s Floating payable 6,313.5 5 1,863.0 2 EURIBOR Fixed Receivable v/s Floating payable 3,218.5 13 6,374.3 26 EURIBOR Fixed payable v/s Floating receivable 1,522.4 3 500.0 1 EURIBOR v/s USD LIBOR Floating receivable v/s Floating payable - - 19,505.6 9 EURIBOR v/s USD LIBOR Floating payable v/s Floating receivable - - 17,888.5 5 EURIBOR v/s USD SOFR Floating payable v/s Floating receivable - - 16,434.0 1 EURIBOR v/s USD SOFR Floating receivable v/s Floating payable - - 541.0 2 GBP SONIA v/s USD LIBOR Floating receivable v/s Floating payable - - 1,758.5 3 GBP SONIA v/s USD LIBOR Floating payable v/s Floating receivable - - 1,953.2 5 GBP SONIA v/s USD SOFR Floating receivable v/s Floating payable 4,297.5 3 1,971.3 2 GBP SONIA v/s USD SOFR Floating payable v/s Floating receivable 3,600.6 8 2,868.1 2 JPY TONAR v/s USD LIBOR Floating payable v/s Floating receivable - - 369.9 1 MIFOR v/s USD LIBOR Floating receivable v/s Floating payable - - 4,626.3 3 OTHERS Fixed receivable v/s Fixed payable 243,640.1 128 190,876.2 174 USD LIBOR Fixed receivable v/s Floating payable - - 135,962.5 78 USD LIBOR Floating receivable v/s Fixed payable - - 74,179.5 57 USD SOFR Fixed payable v/s Floating receivable 84,243.7 48 35,379.4 15 USD SOFR Fixed receivable v/s Floating payable 150,095.6 99 33,221.7 25 USD SOFR v/s EURIBOR Floating receivable v/s Floating payable 18,512.4 12 16,434.0 1 USD SOFR v/s EURIBOR Floating payable v/s Floating receivable 16,465.6 5 - - EUR ESTR v/s USD SOFR Floating payable v/s Floating receivable 2,995.5 3 1,922.9 1 EUR ESTR Floating receivable v/s Fixed payable 494.3 1 - - USD SOFR VS JPY TONAR Floating payable v/s Floating receivable 1,063.3 3 - - USD SOFR VS JPY TONAR Floating receivable v/s Floating payable 164.7 1 - - USD SOFR VS MOD MIFOR Floating receivable v/s Floating payable 4,626.3 3 - - Total 541,254.0 335 564,629.9 413 1. Benchmark indicates floating leg of the fixed v/s floating CCS. Annual Report 2023-24 | 201 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 18. Classification of advances and provisions held The following table sets forth, the classification of advances and provisions held at March 31, 2024. ` in million Standard Non-Performing Total Total Standard Advances Sub- standard Doubtful Loss Total Non- Performing Advances Gross Standard Advances and NPAs Opening balance 10,146,666.3 68,781.1 117,133.4 113,946.2 299,860.7 10,446,527.0 Add: Additions during the period 189,987.9 Less: Reductions during the period* (216,709.9) Closing balance 11,791,734.4 87,131.1 91,697.3 94,310.3 273,138.7 12,064,873.1 *Reductions in Gross NPAs due to: i) Upgradation (92,299.3) ii) Recoveries (excluding recoveries from upgraded accounts) (62,428.1) iii) Technical/prudential write-offs (52,669.3) iv) Write-offs other than those under (iii) above (9,313.2) Provisions (excluding floating provisions) Opening balance of provisions held 1,783.9 32,545.7 101,866.2 113,946.2 248,358.1 250,142.0 Add: Fresh provisions made during the period 118,512.2 Less: Excess provision reversed/write-off loans (147,511.5) Closing balance of provisions held 1,448.5 44,202.8 80,845.7 94,310.3 219,358.8 220,807.3 Net NPAs Opening balance 36,233.6 15,267.1 - 51,500.7 Add: Fresh additions during the period 85,465.3 Less: Reductions during the period (83,188.1) Closing balance 42,926.4 10,851.5 - 53,777.9 Floating provisions Opening balance 1.9 Add: Additional provisions made during the period - Less: Amount drawn down during the period - Closing balance of floating provisions 1.9 Technical write-offs and the recoveries made thereon Opening balance of technical/prudential written-off accounts 493,636.8 Add: Technical/prudential write-offs during the period 55,237.0 Less: Recoveries made from previously technical/prudential written-off accounts during the period (20,166.8) Less: Sacrifice made from previously technical/prudential written-off accounts during the period (6,602.6) Closing balance 522,104.4 202 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, the classification of advances and provisions held at March 31, 2023. ` in million Standard Non-Performing Total Total Standard Advances Sub- standard Doubtful Loss Total Non- Performing Advances Gross Standard Advances and NPAs Opening balance 8,523,814.1 85,308.8 177,027.7 70,612.7 332,949.2 8,856,763.3 Add: Additions during the period 183,093.8 Less: Reductions during the period* (216,182.3) Closing balance 10,146,666.3 68,781.1 117,133.4 113,946.2 299,860.7 10,446,527.0 *Reductions in Gross NPAs due to: i) Upgradation (90,629.3) ii) Recoveries (excluding recoveries from upgraded accounts) (80,341.0) iii) Technical/prudential write-offs (35,788.6) iv) Write-offs other than those under (iii) above (9,423.4) Provisions (excluding floating provisions) Opening balance of provisions held 2,920.2 39,040.1 153,984.1 70,612.7 263,636.9 266,557.1 Add: Fresh provisions made during the period 116,170.8 Less: Excess provision reversed/write-off loans (131,449.6) Closing balance of provisions held 1,783.9 32,545.7 101,866.2 113,946.2 248,358.1 250,142.0 Net NPAs Opening balance 46,266.8 23,043.6 - 69,310.4 Add: Fresh additions during the period 88,038.6 Less: Reductions during the period (105,848.3) Closing balance 36,233.6 15,267.1 - 51,500.7 Floating provisions Opening balance 1.9 Add: Additional provisions made during the period - Less: Amount drawn down during the period - Closing balance of floating provisions 1.9 Technical write-offs and the recoveries made thereon Opening balance of technical/prudential written-off accounts 476,579.1 Add: Technical/prudential write-offs during the period 50,973.4 Less: Recoveries made from previously technical/prudential written-off accounts during the period (18,348.5) Less: Sacrifice made from previously technical/prudential written-off accounts during the period (15,567.2) Closing balance 493,636.8 Annual Report 2023-24 | 203 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Following table sets forth, for the period indicated, NPA ratios of the Bank. Particulars At March 31, 2024 At March 31, 2023 Gross NPA to Gross Advances 2.26% 2.87% Net NPA to Net Advances 0.45% 0.51% Provision coverage ratio 80.3% 82.8% In accordance with RBI guidelines, the loans and advances held at the overseas branches that are identified as impaired as per host country regulations for reasons other than record of recovery, but which are standard as per the extant RBI guidelines, are classified as NPAs to the extent of amount outstanding in the host country. At March 31, 2024, the Bank has not classified any loans as NPAs at overseas branches due to host country regulations (at March 31, 2023: NPAs of ` 8,229.0 million and provision of ` 4,623.0 million which are included in the above table). 19. Divergence in asset classification and provisioning for NPAs In terms of the RBI circular no. DOR.ACC.REC.No.74/21.04.018/2022-23 dated October 11, 2022, banks are required to disclose the divergences in asset classification and provisioning consequent to RBI’s annual supervisory process in their notes to accounts to the financial statements, wherever either (a) the additional provisioning requirements assessed by RBI exceed 5% (10% till March 31, 2023) of the reported net profits before provisions and contingencies or (b) the additional gross NPAs identified by RBI exceed 5% (10% till March 31, 2023) of the published incremental gross NPAs for the reference period, or both. Based on the condition mentioned in RBI circular, no disclosure on divergence in asset classification and provisioning for NPAs is required with respect to RBI’s supervisory process for the year ended March 31, 2023 and for the year ended March 31, 2022. 20. General provision on standard assets The general provision on standard assets held by the Bank at March 31, 2024 was ` 58,631.6 million (March 31, 2023: ` 47,022.4 million). The Bank made general provision on standard assets amounting to ` 11,548.3 million during the year ended March 31, 2024 (year ended March 31, 2023: ` 5,795.6 million). General provision on standard assets is made on global loan portfolio as below: • Farm credit to agricultural activities, individual housing loans sanctioned on or after June 7, 2017 and advances to Small and Micro Enterprises (SMEs) sectors at 0.25%, advances to Commercial Real Estate sector at 1.00% and to Commercial Real Estate – Residential Housing Sector at 0.75%, all other loans and advances at 0.40% • At overseas branches, provision is made at higher of RBI and host country guidelines • Credit exposures computed as per the current marked-to-market (MTM) value of the contract arising on account of the interest rate and foreign exchange derivatives, credit default swaps and gold exposures, provision is made at the rate applicable to respective categories of advances • Loans and advances to entities with unhedged foreign currency exposures, provision is made ranging from 0.10% to 0.80% depending on likely loss due to exchange rate movement • Exposures to the wholly owned subsidiaries of the overseas subsidiaries of Indian companies at 2.00% • Standard advances to stress sectors based on evaluation of risk and stress in various sectors as per the Board approved policy of the Bank • Incremental exposure of the banking system in excess of Normally Permitted Lending Limit (NPLL) on borrowers classified as specified borrower at 3.00% 204 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 21. Priority Sector Lending Certificates (PSLCs) The following table sets forth, for the periods indicated, details of PSLCs purchased and sold by the Bank. ` in million Category Year ended March 31, 2024 Year ended March 31, 2023 Bought Sold Bought Sold General - 405,500.0 - 454,245.0 Agriculture 1,097,275.0 57,407.5 704,965.0 - Micro enterprise - 417,652.5 11,500.0 287,005.0 Total 1,097,275.0 880,560.0 716,465.0 741,250.0 22. Sale and acquisition of loans a) Details of loan not in default sold/acquired by the Bank as per Master Direction - Reserve Bank of India (Transfer of Loan Exposures) Directions, 2021 dated September 24, 2021 1. The following table sets forth, for the period indicated, details of loans not in default sold/acquired under assignment: ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Loans acquired Loans sold Loans acquired Loans sold Amount of loan 95,674.1 5,923.1 94,688.2 1,875.0 Weighted average residual maturity (in years) 7.15 9.94 5.63 0.48 Weighted average holding period of the originator (in years) 1.21 0.53 1.63 0.01 Retention of beneficial economic interest by the originator 44,799.2 22,762.0 88,563.8 1,625.0 Tangible security coverage (times) 1.37 1.33 4.04 - 1. In addition, the Bank acquired unfunded loans amounting to ` 2,754.1 million (year ended March 31, 2023: ` 3,278.4 million) and sold unfunded loans amounting to `4,265.9 million (year ended March 31, 2023: ` 6,540.0 million) for year ended March 31, 2024 through novation. 2. In addition, the bank has not acquired any loan through risk participation in secondary market 2. The following table sets forth, for the period indicated, rating-wise distribution of the loans sold/acquired under assignment: ` in million Rating Year ended March 31, 2024 Year ended March 31, 2023 Loans acquired Loans sold Loans acquired Loans sold IND A-, A, A+ 2,002.1 - 9,260.2 - Moody’s B1 4,059.0 - 5,998.4 - ICRA A-, AA-, AA 3,748.4 3,064.1 5,000.0 - Crisil A+, AA, A 2,473.2 - 6,410.0 1,875.0 Care BBB 200.0 - 838.0 - Care AAA 9,962.4 - - - 1. Excluding retail and other unrated loans. Annual Report 2023-24 | 205 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) b) Details of stressed loans sold/acquired by the Bank. 1. The following table sets forth, for the period indicated, details of stressed loans classified as NPA sold by the Bank. ` in million, except number of accounts Particulars Year ended March 31, 2024 Year ended March 31, 2023 To ARCs To permitted transferees To ARCs To permitted transferees Number of accounts 21 - 9 1 Aggregate principal outstanding of loans transferred 4,654.3 - 3,045.4 30.2 Weighted average residual tenor of the loans transferred3 - - - - Net book value of loans transferred (at the time of transfer)4 - - 123.8 - Aggregate consideration 1,861.92 - 1,606.5 15.7 Additional consideration realized in respect of accounts transferred in earlier years - - - - 1. Excess provision reversed in profit and loss account due to sale of NPAs to ARCs was ` 626.4 million, no amount was transferred to other permitted transferees (year ended March 31, 2023: ARCs ` 1,482.7 million and permitted transferees ` 15.7 million). 2. The provision continue towards SRs received as a part of consideration was ` 1,235.4 million 3. Net of write-off 4. For NPAs, the Bank issues loan recall notice and initiates legal proceedings for recovery, due to which the weighted average residual tenor is not applicable. 5. Net of write-off and provisions. 2. The Bank has not sold/acquired loan classified as Special Mention Account (SMA) during the year ended March 31, 2024 (year ended March 31, 2023: Nil). 3. The Bank has not acquired non-performing loans during the year ended March 31, 2024 (year ended March 31, 2023: Nil). 4. The following table sets forth, for the period indicated, rating-wise distribution of SRs held by the bank. ` in million Rating NAV estimate % At March 31, 2024 At March 31, 2023 RR1 Above 100% 3,355.0 4,286.0 RR2 Above 75% upto 100% - 1,615.4 RR3 Above 50% upto 75% 2,341.8 2,681.1 RR4 Above 25% upto 50% - 1,507.8 RR5 Upto 25% 7,865.8 6,002.2 Total 13,562.6 16,092.5 1. Amount represents net of provisions. 2. Additionally, the Bank holds, marked-to-market loss of ` 3,980.2 million (March 31, 2023: ` 4,627.3 million) and additional provision of ` 9,291.4 million (March 31, 2023: ` 9,353.0 million) at March 31, 2024. 206 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 23. Securitisation Following table sets forth, for the period indicated, details of securitisation of standard assets of the Bank ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 1. Number of SPVs sponsored by the bank for securitisation transactions during the year - - 2. Total a) No. and b) amount of securitised loans as per books of the SPVs sponsored by the Bank during the year - - 3. Total amount of exposures retained by the Bank to comply with Minimum Retention Requirement (MRR) during the year - - a) Off-balance sheet exposures • First loss • Others - - - - b) On-balance sheet exposures • First loss • Others - - - - 4. Amount of exposure to securitisation transactions other than MRR during the year Off-balance sheet exposures a) Exposure to own securitisation • First loss • Others b) Exposure to third party securitisation • First loss • Others - - - 217.3 - - - 941.2 On-balance sheet exposures a) Exposure to own securitisation • First loss • Others b) Exposure to third party securitisation • First loss • Others - - - - - - - - 5. Sale consideration received for the securitised assets and gain/loss on sale on account of securitisation1 - - 6. Outstanding amount of services provided by way of: • credit enhancement2 • liquidity support • post-securitisation asset servicing 2,794.0 209.7 - 3,345.9 209.7 - Annual Report 2023-24 | 207 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 7. Performance of facilities provided a) First loss credit facility • Amount paid (0.00%)4 • Repayment received (0.00%)4 • Outstanding amount b) Second loss credit facility • Amount paid • Repayment received • Outstanding amount2 c) Liquidity facility • Amount paid (0.24%)4,5 • Repayment received (0.23%)4,5 • Outstanding amount - - 734.9 - - 1,849.5 0.53 0.53 209.7 - - 734.9 - - 2611.0 0.13 0.13 209.7 8. Average default rate of portfolios observed at the year end a) MBS deals (cumulative in %) 1.4 1.4 b) ABS deals (cumulative in %) - - 9. Amount and number of additional/top up loan given on same underlying loans. a) MBS deals • Gross Amount • Count 43.5 58 56.3 86 b) ABS deals • Gross Amount • Count - - - - 10. Investor complaints (a) Directly/Indirectly received and; - - (b) Complaints outstanding - - 1. Includes gain/(loss) on deal closures, gain amortised during the year and expenses related to utilisation of credit enhancement for all the outstanding deals. 2. Includes outstanding credit enhancement in the form of guarantees for third party originated securitisation transactions amounting to ` 1,158.5 million for the year ended March 31, 2024 (for the year ended March 31, 2023: ` 1,920.0 million) 3. Insignificant amount 4. Percentage has been derived based on opening outstanding balance of the facility. 5. For the year ended March 31, 2024, amount paid: 0.002% and repayment received: 0.002%. For the year ended March 31, 2023, amount paid: 0.07% and repayment received: 0.07% 208 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 24. Accounts restructured under Micro, Small and Medium Enterprises (MSME) sector The following table sets forth, for the periods indicated, the details of accounts restructured under MSME sector under RBI guidelines issued in January 2019 and subsequent changes thereafter. ` in million, except number of accounts At March 31, 2024 At March 31, 2023 Number of accounts restructured Amount outstanding Number of accounts restructured Amount outstanding 1,335 11,506.3 1,908 19,669.8 1. Excludes cases which have been written off 25. Resolution of stressed assets During the year ended March 31, 2024, the Bank has implemented resolution plan for one borrower amounting to ` 512.4 million (March 31, 2023: seven borrowers for ` 19,286.3 million) under the prudential framework for stressed assets issued by RBI on June 7, 2019. 26. Resolution Framework for Covid-19 related Stress I. The following table sets forth, details of resolution plans implemented under the Resolution Framework for Covid-19 related stress of individuals and small borrowers as per RBI circular dated May 5, 2021 (Resolution Framework 2.0): ` in million For the six months ended March 31, 2024 Type of borrower Exposure to accounts classified as Standard consequent to implementation of resolution plan – at September 30, 2023 (A) Of (A), aggregate debt that slipped into NPA during six months ended March 31, 20241 Of (A) amount written off during six months ended March 31, 2024 Of (A) amount paid by the borrowers during six months ended March 31, 20242 Exposure to accounts classified as Standard consequent to implementation of resolution plan at March 31, 2024 Personal Loans3 15,670.5 549.8 17.8 2,080.9 13,039.8 Corporate persons4 7,975.8 - - 82.5 7,893.3 Of which MSMEs - - - - - Others 4,313.0 46.9 1.5 238.2 4,027.9 Total 27,959.3 596.7 19.3 2,401.6 24,961.0 1. Includes cases which have been written off during the period. 2. Net of increase in exposure during the period. 3. Includes various categories of retail loans. 4. As defined in Section 3(7) of the Insolvency and Bankruptcy Code, 2016. Annual Report 2023-24 | 209 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million For the six months ended September 30, 2023 Type of borrower Exposure to accounts classified as Standard consequent to implementation of resolution plan – at March 31, 2023 (A) Of (A), aggregate debt that slipped into NPA during six months ended September 30, 20231 Of (A) amount written off during six months ended September 30, 2023 Of (A) amount paid by the borrowers during six months ended September 30, 20232 Exposure to accounts classified as Standard consequent to implementation of resolution plan at September 30, 2023 Personal Loans3 19,607.8 1,119.8 49.8 2,817.5 15,670.5 Corporate persons4 8,109.0 - - 133.2 7,975.8 Of which, MSMEs - - - - - Others 5,687.6 422.0 25.9 952.6 4,313.0 Total 33,404.4 1,541.8 75.7 3,903.3 27,959.3 1. Includes cases which have been written off during the period. 2. Net of increase in exposure during the period. 3. Includes various categories of retail loans. 4. As defined in Section 3(7) of the Insolvency and Bankruptcy Code, 2016. ` in million For the six months ended March 31, 2023 Type of borrower Exposure to accounts classified as Standard consequent to implementation of resolution plan – at September, 2022 (A) Of (A), aggregate debt that slipped into NPA during six months ended March 31, 20231 Of (A) amount written off during six months ended March 31, 2023 Of (A) amount paid by the borrowers during six months ended March 31, 20232 Exposure to accounts classified as Standard consequent to implementation of resolution plan at March 31, 2023 Personal Loans3 24,422.2 1,707.7 75.9 3,106.7 19,607.8 Corporate persons4 17,499.5 7,887.3 - 1,503.2 8,109.0 Of which, MSMEs - - - - - Others 6,113.0 226.2 10.3 199.2 5,687.6 Total 48,034.7 9,821.2 86.2 4,809.1 33,404.4 1. Includes cases which have been written off during the period. 2. Net of increase in exposure during the period. 3. Includes various categories of retail loans. 4. As defined in Section 3(7) of the Insolvency and Bankruptcy Code, 2016. 210 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 27. Concentration of Deposits, Advances, Exposures and NPAs (I) Concentration of deposits, advances, exposures and NPAs ` in million except percentage Concentration of deposits At March 31, 2024 At March 31, 2023 Total deposits of 20 largest depositors 486,043.2 410,099.2 Deposits of 20 largest depositors as a percentage of total deposits of the Bank 3.44% 3.47% ` in million except percentage Concentration of advances1 At March 31, 2024 At March 31, 2023 Total advances to 20 largest borrowers (including banks) 1,977,053.9 2,023,084.9 Advances to 20 largest borrowers as a percentage of total advances of the Bank 8.59% 10.28% 1. Represents credit exposure (funded and non-funded) including derivatives exposures as per RBI guidelines on exposure norms. ` in million except percentage Concentration of exposures1 At March 31, 2024 At March 31, 2023 Total exposure to 20 largest borrowers/customers (including banks) 2,112,920.7 2,069,491.6 Exposures to 20 largest borrowers/customers as a percentage of total exposure of the Bank 8.86% 10.22% 1. Represents credit and investment exposures as per RBI guidelines on exposure norms. ` in million except percentage Concentration of NPAs At March 31, 2024 At March 31, 2023 Total exposure1 to top 20 NPA accounts 115,431.9 159,988.5 Exposure of 20 largest NPA as a percentage of total Gross NPAs. 34.4% 42.71% 1. Represents credit and investment exposures as per RBI guidelines on exposure norms. Annual Report 2023-24 | 211 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) (II) Sector-wise advances ` in million, except percentages S No. Particulars At March 31, 2024 Outstanding advances Gross NPAs1 % of gross NPAs1 to total advances in that sector A. Priority sector 1. Agriculture and allied activities 829,107.0 35,889.6 4.33% 2. Advances to industries sector eligible as priority sector 1,020,024.4 7,796.7 0.76% 3. Services of which: Wholesale trade Transport operators 1,517,544.0 324,234.0 202,597.2 16,750.4 4,915.1 2,413.2 1.10% 1.52% 1.19% 4. Personal loans of which: Housing 415,885.8 397,949.7 7,707.6 7,329.8 1.85% 1.84% Sub-total (A) 3,782,561.2 68,144.3 1.80% B. Non-priority sector 1. Agriculture and allied activities - - - 2. Advances to industries sector of which: Infrastructure 1,555,107.4 454,290.1 112,834.5 14,141.1 7.26% 3.11% 3. Services of which: Commercial real estate Financial Intermediation Wholesale trade 1,989,264.7 767,356.3 633,744.5 321,761.4 32,014.1 13,797.5 215.0 5,904.4 1.61% 1.80% 0.03% 1.84% 4. Personal loans2 of which: Housing Vehicle/Auto Loans Credit Card Receivables 4,737,939.8 1,884,493.0 474,727.9 522,876.8 60,145.8 18,198.1 7,759.9 9,673.6 1.27% 0.97% 1.63% 1.85% Sub-total (B) 8,282,311.9 204,994.3 2.48% Total (A)+(B) 12,064,873.1 273,138.7 2.26% 1. Represents loans and advances. 2. Excludes commercial business loans and dealer funding. 3. Sub-sectors have been disclosed where advances exceed 10% of total advances in that sector at reporting date. 212 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) (II) Sector-wise advances ` in million, except percentages S No. Particulars At March 31, 2023 Outstanding advances Gross NPAs1 % of gross NPAs1 to total advances in that sector A. Priority sector 1. Agriculture and allied activities 630,585.6 29,272.7 4.64% 2. Advances to industries sector eligible as priority sector 758,377.7 5,991.2 0.79% 3. Services of which: Transport operators Wholesale trade 1,038,753.5 150,076.4 234,252.1 12,951.7 2,642.6 2,972.6 1.25% 1.76% 1.27% 4. Personal loans of which: Housing 414,876.7 402,748.5 6,486.0 6,427.1 1.56% 1.60% Sub-total (A) 2,842,593.5 54,701.7 1.92% B. Non-priority sector 1. Agriculture and allied activities - - - 2. Advances to industries sector of which: Infrastructure 1,699,823.5 480,462.6 157,301.1 34,621.6 9.25% 7.21% 3. Services of which: Wholesale Trade Commercial real estate Financial Intermediation 1,878,763.6 256,179.9 620,974.9 764,400.9 36,837.5 6,881.6 13,921.0 744.1 1.96% 2.69% 2.24% 0.10% 4. Personal loans2 of which: Housing Vehicle/Auto Loans 4,025,346.4 1,759,930.0 434,159.6 51,020.5 17,044.0 6,465.4 1.27% 0.97% 1.49% Sub-total (B) 7,603,933.5 245,159.1 3.22% Total (A)+(B) 10,446,527.0 299,860.7 2.87% 1. Represents loans and advances. 2. Excludes commercial business loans and dealer funding. 3. Sub-sectors have been disclosed where advances exceed 10% of total advances in that sector at reporting date. Annual Report 2023-24 | 213 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) (III) Overseas assets, NPAs1 and revenue ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Total assets2 680,079.6 731,796.0 Total NPAs (net) 395.1 3,790.9 Total revenue2 46,075.1 32,912.3 1. Represents loans and advances. 2. Represents the total assets and total revenue of foreign operations as reported in Schedule 18 of the financial statements, note no. 5 on information about business and geographical segments. (IV) Off-balance sheet special purpose vehicles (SPVs) sponsored (which are required to be consolidated as per accounting norms) for the year ended March 31, 2024 1. The following table sets forth, the names of SPVs/trusts sponsored by the Bank/subsidiaries which are consolidated. Sr. No. Name of the SPVs sponsored1 A. Domestic 1. ICICI Strategic Investments Fund2 2. India Advantage Fund-III2 3. India Advantage Fund-IV2 B. Overseas None 1. SPVs/Trusts which are consolidated and set-up/sponsored by the Bank/subsidiaries of the Bank. 2. The nature of business of the above entities is venture capital fund. 2. There are no SPVs/trusts which are not sponsored by the Bank/subsidiaries and are consolidated. 28. Intra-group exposure The following table sets forth, for the periods indicated, the details of intra-group exposure. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 1. Total amount of intra-group exposures 155,779.7 176,612.2 2. Total amount of top 20 intra-group exposures 155,779.6 176,612.2 3. Percentage of intra-group exposure to total exposures of the Bank on borrowers/customers 0.65% 0.87% 4. Details of breach of limits on intra-group exposures and regulatory action thereon, if any Nil Nil 214 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 29. Exposure to sensitive sectors The Bank has exposure to sectors, which are sensitive to asset price fluctuations. The sensitive sectors include capital markets and real estate. The following table sets forth, for the periods indicated, the position of exposure to capital market sector. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 1. Direct investment in equity shares, convertible bonds, convertible debentures and units of equity-oriented mutual funds, the corpus of which is not exclusively invested in corporate debt 76,338.6 48,803.9 2. Advances against shares/bonds/debentures or other securities or on clean basis to individuals for investment in shares (including IPOs/ESOPs), convertible bonds, convertible debentures and units of equity-oriented mutual funds 1,296.2 1,394.3 3. Advances for any other purposes where shares or convertible bonds or convertible debentures or units of equity oriented mutual funds are taken as primary security 30,405.2 23,224.9 4. Advances for any other purposes to the extent secured by the collateral security of shares or convertible bonds or convertible debentures or units of equity oriented mutual funds i.e. where the primary security other than shares/convertible bonds/convertible debentures/units of equity oriented mutual funds does not fully cover the advances - - 5. Secured and unsecured advances to stockbrokers and guarantees issued on behalf of stock brokers and market makers 355,802.51 162,337.0 6. All exposures to venture capital funds (both registered and unregistered) 14,608.8 14,440.7 7. Others - - Total exposure to capital market2 478,451.3 250,200.8 1. At March 31, 2024, included intra-day exposures amounting to ` 163,051.6 million. Corresponding exposure at March 31, 2023: ` 122,204.0 million. 2. At March 31, 2024, excludes investment in equity shares of ` 25,888.8 million (March 31, 2023: ` 22,588.5 million) exempted from the regulatory ceiling, out of which investments of ` 7,978.4 million (March 31, 2023: ` 4,650.0 million) were acquired due to conversion of debt to equity during restructuring process under RBI circular dated June 7, 2019 on “Prudential Framework for Resolution of Stressed Assets” and investments of ` 16,327.0 million (March 31, 2023: ` 16,330.2 million) were acquired under other resolution schemes of RBI. Annual Report 2023-24 | 215 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, for the periods indicated, the summary of exposure to real estate sector. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 I Direct exposure 5,115,338.0 4,405,419.9 1. Residential mortgages 3,898,373.6 3,434,920.2 of which: individual housing loans eligible for priority sector advances 412,150.5 418,496.4 2. Commercial real estate1 1,152,820.6 940,828.6 3. Investments in Mortgage Backed Securities (MBS) and other securitised exposure 64,143.8 29,671.1 a. Residential 58,551.7 25,420.4 b. Commercial real estate 5,592.1 4,250.7 II Indirect exposure 153,521.8 191,342.0 Fund based and non-fund based exposures on National Housing Bank (NHB) and Housing Finance Companies (HFCs) 153,521.8 191,342.0 Total exposure to real estate sector 5,268,859.8 4,596,761.9 1. Commercial real estate exposure includes loans to individuals against non-residential premises, loans given to land and building developers for construction, corporate loans for development of special economic zone, loans to borrowers where servicing of loans is from a real estate activity and exposures to mutual funds/venture capital funds/private equity funds investing primarily in the real estate companies. 30. Factoring business At March 31, 2024, the outstanding receivables acquired by the Bank under factoring business were ` 109,134.0 million (March 31, 2023: ` 54,281.8 million) which are reported under ‘Bills purchased and discounted’ in Schedule 9 – Advances of the balance sheet. 31. Risk category-wise country exposure As per the extant RBI guidelines, the country exposure of the Bank is categorised into various risk categories listed in the following table. The funded country exposure (net) of the Bank as a percentage of total funded assets for United States of America was 1.50% (March 31, 2023: 2.74%). As the net funded exposure to United States of America at March 31, 2024, exceeded 1% of total funded assets (March 31, 2023: United States of America), the Bank held a provision of ` 280.0 million on country exposure at March 31, 2024 (March 31, 2023: ` 365.0 million) based on RBI guidelines. The following table sets forth, for the periods indicated, the details of exposure (net) and provision held by the bank. ` in million Risk category Exposure (net) at March 31, 2024 Provision held at March 31, 2024 Exposure (net) at March 31, 2023 Provision held at March 31, 2023 Insignificant 823,260.5 280.0 1,023,324.6 365.0 Low 309,763.9 - 225,028.2 - Moderately Low 123,670.0 - 30,962.3 - Moderate 12,562.2 - 1,522.5 - Moderately High 11,796.3 - 10,899.2 - High 0.5 - 118.0 - Very High 135.2 - - - Total 1,281,188.6 280.0 1,291,854.8 365.0 216 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 32. Unsecured advances against intangible assets The Bank has not made advances against intangible collaterals of the borrowers, which are classified as ‘Unsecured’ in the financial statements at March 31, 2024 (March 31, 2023: Nil). 33. Revaluation of fixed assets The Bank follows the revaluation model for its premises (land and buildings) other than improvements to leasehold property as per AS 10 – ‘Property, Plant and Equipment’. As per the Bank’s policy, annual revaluation is carried out through external valuers, using methodologies such as direct sales comparison method and income capitalisation method and the incremental amount has been taken to revaluation reserve. The revalued amount at March 31, 2024 was ` 54,451.1 million (March 31, 2023: ` 54,723.8 million) as compared to the historical cost less accumulated depreciation of ` 23,608.2 million (March 31, 2023: ` 24,099.2 million). The revaluation reserve is not available for distribution of dividend. 34. Fixed Assets The following table sets forth, for the periods indicated, the movement in software acquired by the Bank, as included in fixed assets. ` in million Particulars At March 31, 2024 At March 31, 2023 At cost at March 31 of preceding year 31,434.6 29,157.1 Additions during the year 5,863.2 4,466.7 Deductions during the year (463.3) (2,189.2) Depreciation to date (26,573.8) (22,631.2) Net block 10,260.7 8,803.4 35. Debt assets swap transactions During the year ended March 31, 2024, the Bank did not acquire any non-banking assets under debt-asset swap transactions (year ended March 31, 2023: Nil). During the year ended March 31, 2024, the Bank has sold one non-banking asset having book value of ` 827.7 million for consideration of ` 691.5 million (year ended March 31, 2023: Nil). Assets amounting to ` 2.6 million were transferred from banking assets to non-banking asset during the year ended March 31, 2024 (year ended March 31, 2023: Nil). The net book value of non-banking assets acquired in satisfaction of claims by the Bank outstanding at March 31, 2024 amounted to Nil (March 31, 2023: Nil), net of provision held of ` 28,189.9 million (March 31, 2023: ` 29,011.8 million). Annual Report 2023-24 | 217 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 36. Lease I. Assets taken under operating lease Operating leases primarily comprise office premises which are renewable at the option of the Bank. i. The following table sets forth, for the periods indicated, the details of liability for premises taken on non- cancellable operating leases. ` in million Particulars At March 31, 2024 At March 31, 2023 Not later than one year 380.5 298.9 Later than one year and not later than five years 304.3 180.0 Later than five years 13.4 7.1 Total 698.2 486.0 ii. Total of non-cancellable lease payments recognised in the profit and loss account for the year ended March 31, 2024 is ` 931.3 million (year ended March 31, 2023: ` 552.6 million). II. Assets taken under finance lease The following table sets forth, for the periods indicated, the details of assets taken on finance leases. ` in million Particulars At March 31, 2024 At March 31, 2023 1. Total Minimum lease payments outstanding Not later than one year 249.8 271.3 Later than one year and not later than five years 359.9 596.1 Later than five years 0.2 14.9 Total 609.9 882.3 2. Interest cost payable Not later than one year 42.6 70.0 Later than one year and not later than five years 41.1 83.3 Later than five years - 0.5 Total 83.7 153.8 3. Present value of minimum lease payments payable(A-B) Not later than one year 207.2 201.3 Later than one year and not later than five years 318.8 512.8 Later than five years 0.2 14.4 Total 526.2 728.5 218 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 37. Description of contingent liabilities The following table describes the nature of contingent liabilities of the Bank. Sr. no. Contingent liability Brief Description 1. Claims against the Bank, not acknowledged as debts This item represents demands made in certain tax and legal matters against the Bank in the normal course of business and customer claims arising in fraud cases. In accordance with the Bank’s accounting policy and AS 29, the Bank has reviewed and classified these items as possible obligations based on legal opinion/judicial precedents/ assessment by the Bank. 2. Liability for partly paid investments This item represents amounts remaining unpaid towards liability for partly paid investments. These payment obligations of the Bank do not have any profit/loss impact. 3. Liability on account of outstanding forward exchange contracts The Bank enters into foreign exchange contracts in the normal course of its business, to exchange currencies at a pre-fixed price at a future date. This item represents the notional principal amount of such contracts. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, and hence a large value of gross notional principal of the portfolio, while the net market risk is lower. 4. Guarantees given on behalf of constituents, acceptances, endorsements and other obligations This item represents the guarantees and documentary credits issued by the Bank in favour of third parties on behalf of its customers, as part of its trade finance banking activities with a view to augment the customers’ credit standing. Through these instruments, the Bank undertakes to make payments for its customers’ obligations, either directly or in case the customers fail to fulfill their financial or performance obligations. 5. Currency swaps, interest rate swaps, currency options and interest rate futures This item represents the notional principal amount of various derivative instruments which the Bank undertakes in its normal course of business. The Bank offers these products to its customers to enable them to transfer, modify or reduce their foreign exchange and interest rate risks. The Bank also undertakes these contracts to manage its own interest rate and foreign exchange positions. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, and hence a large value of gross notional principal of the portfolio, while the net market risk is lower. 6. Other items for which the Bank is contingently liable Other items for which the Bank is contingently liable primarily include the amount of government securities bought/sold and remaining to be settled on the date of financial statements. This also includes amount transferred to RBI under the Depositor Education and Awareness Fund, commitment towards contribution to venture fund, the amount that the Bank is obligated to pay under capital contracts and letter of undertaking and indemnity letters. Capital contracts are job orders of a capital nature which have been committed. Annual Report 2023-24 | 219 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 38. Insurance business The following table sets forth, for the periods indicated, the break-up of income derived from insurance business. ` in million Sr. No. Particulars Year ended March 31, 2024 Year ended March 31, 2023 1. Income from selling life insurance policies 3,161.4 3,821.2 2. Income from selling non-life insurance policies 1,250.6 1,030.6 39. Marketing & Distribution The following table sets forth, for the periods indicated, income received from marketing and distribution function. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Income received in respect of the marketing and distribution 5,427.5 4,928.2 1. Includes referral fees, commission and fees received on distribution/cross selling of various products including mutual funds. 40. Employee benefits Pension The following tables set forth, for the periods indicated, movement of the present value of the defined benefit obligation, fair value of plan assets and other details for pension benefits. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening obligations 18,429.1 18,661.0 Service cost 114.8 151.7 Interest cost 1,314.0 1,150.6 Actuarial (gain)/loss (11.5) 758.2 Past Service Cost 306.91 - Liabilities extinguished on settlement (2,137.9) (2,192.6) Benefits paid (95.5) (99.8) Obligations at the end of year 17,919.9 18,429.1 Opening plan assets, at fair value 18,190.2 19,843.3 Expected return on plan assets 1,361.0 1,522.0 Actuarial gain/(loss) 439.5 (682.0) Assets distributed on settlement (2,375.4) (2,436.2) Contributions 401.7 42.9 Benefits paid (95.5) (99.8) Closing plan assets, at fair value 17,921.5 18,190.2 Fair value of plan assets at the end of the year 17,921.5 18,190.2 Present value of the defined benefit obligations at the end of the year (17,919.9) (18,429.1) Amount not recognised as an asset (limit in Para 59(b) of AS 15 on ‘employee benefits’) - - Asset/(liability) 1.6 (238.9) 220 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Cost2 Service cost 114.8 151.7 Interest cost 1,314.0 1,150.6 Expected return on plan assets (1,361.0) (1,522.0) Actuarial (gain)/loss (451.0) 1,440.2 Past service cost 306.91 - Curtailments & settlements (gain)/loss 237.5 243.6 Effect of the limit in para 59(b) of AS 15 on ‘employee benefits’ - (401.9) Net cost 161.2 1,062.2 Actual return on plan assets 1,800.5 840.0 Expected employer’s contribution next year 400.0 1,000.0 Investment details of plan assets Government of India securities 41.46% 41.74% Corporate bonds 46.59% 48.30% Equity securities in listed companies 9.35% 7.08% Others 2.60% 2.87% Assumptions Discount rate 7.20% 7.30% Salary escalation rate: On Basic pay 1.50% 1.50% On Dearness relief 8.00% 8.00% Estimated rate of return on plan assets 7.50% 7.50% 1. Represents impact towards dearness allowance neutralization as per IBA notification dated October 16, 2023 2. Included in line item ‘Payments to and provision for employees’ of Schedule-16 Operating expenses. Estimated rate of return on plan assets is based on the expected average long-term rate of return on investments of the Fund during the estimated term of the obligations. Experience adjustment ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2022 Year ended March 31, 2021 Year ended March 31, 2020 Fair value of plan assets 17,921.5 18,190.2 19,843.3 21,162.2 16,972.1 Defined benefit obligations (17,919.9) (18,429.1) (18,661.0) (20,265.6) (19,914.3) Amount not recognised as an asset (limit in para 59(b) of AS 15 on ‘employee benefits’) - - (401.9) (304.8) - Surplus/(deficit) 1.6 (238.9) 780.4 591.8 (2,942.2) Experience adjustment on plan assets 439.5 (682.0) (331.9) 521.9 741.1 Experience adjustment on plan liabilities (227.0) 805.8 809.0 613.4 2,186.1 Annual Report 2023-24 | 221 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Gratuity The following tables set forth, for the periods indicated, movement of the present value of the defined benefit obligation, fair value of plan assets and other details for gratuity benefits. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening obligations 15,566.4 13,590.0 Add: Adjustment for exchange fluctuation on opening obligations 2.4 12.2 Adjusted opening obligations 15,568.8 13,602.2 Service cost 1,606.4 1,342.3 Interest cost 1,184.7 963.0 Actuarial (gain)/loss 996.8 1,178.0 Past service cost - - Liability transferred from/to other companies (40.7) 34.5 Benefits paid (1,304.0) (1,553.6) Obligations at the end of the year 18,012.0 15,566.4 Opening plan assets, at fair value 13,920.3 13,577.4 Expected return on plan assets 1,025.6 985.5 Actuarial gain/(loss) 744.2 (499.4) Contributions 3,586.2 1,375.9 Asset transferred from/to other companies (40.7) 34.5 Benefits paid (1,304.0) (1,553.6) Closing plan assets, at fair value 17,931.6 13,920.3 Fair value of plan assets at the end of the year 17,931.6 13,920.3 Present value of the defined benefit obligations at the end of the year (18,012.0) (15,566.4) Amount not recognised as an asset (limit in Para 59(b) of AS 15 on ‘employee benefits’) - - Asset/(liability) (80.4) (1,646.1) Cost1 Service cost 1,606.4 1,342.3 Interest cost 1,184.7 963.0 Expected return on plan assets (1,025.6) (985.5) Actuarial (gain)/loss 252.7 1,677.4 Past service cost - - Exchange fluctuation loss/(gain) 2.4 12.2 Effect of the limit in para 59(b) of AS 15 on ‘employee benefits’ - - Net cost 2,020.6 3,009.4 Actual return on plan assets 1,769.7 486.1 Expected employer’s contribution next year 1,500.0 1,500.0 Investment details of plan assets Insurer managed funds - - Government of India securities 39.33% 33.40% Corporate bonds 44.67% 47.63% Equity 14.37% 16.71% Others 1.63% 2.26% Assumptions Discount rate 7.20% 7.35% Salary escalation rate 8.00% 8.00% Estimated rate of return on plan assets 7.50% 7.50% 1. Included in line item ‘Payments to and provision for employees’ of Schedule-16 Operating expenses. Estimated rate of return on plan assets is based on the expected average long-term rate of return on investments of the Fund during the estimated term of the obligations. 222 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Experience adjustment ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2022 Year ended March 31, 2021 Year ended March 31, 2020 Plan assets 17,931.6 13,920.3 13,577.4 12,934.8 10,877.1 Defined benefit obligations (18,012.0) (15,566.4) (13,590.0) (12,842.8) (11,938.7) Amount not recognised as an asset (limit in para 59(b) of AS 15 on ‘employee benefits’) - - - - - Surplus/(deficit) (80.4) (1,646.1) (12.6) 92.0 (1,061.6) Experience adjustment on plan assets 744.2 (499.4) (64.9) 720.2 (125.0) Experience adjustment on plan liabilities 1,007.9 731.6 368.0 (484.5) 181.3 The estimates of future salary increases, considered in actuarial valuation, take into consideration inflation, seniority, promotion and other relevant factors. Provident Fund (PF) As there is no liability towards interest rate guarantee on exempt provident fund on the basis of actuarial valuation, the Bank has not made any provision for the year ended March 31, 2024 (year ended March 31, 2023: Nil). The following tables set forth, for the periods indicated, movement of the present value of the defined benefit obligation, fair value of plan assets and other details for provident fund. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening obligations 49,069.7 43,128.7 Service cost 3,066.3 2,458.4 Interest cost 3,762.0 3,024.7 Actuarial (gain)/loss 741.2 862.8 Employees contribution 5,126.2 4,163.2 Liability transferred from/to other companies 1,312.8 934.6 Benefits paid (5,276.7) (5,502.7) Obligations at end of the year 57,801.5 49,069.7 Opening plan assets 49,805.1 44,339.6 Expected return on plan assets 4,135.5 3,741.0 Actuarial gain/(loss) 1,216.4 (329.0) Employer contributions 3,066.3 2,458.4 Employees contributions 5,126.2 4,163.2 Asset transferred from/to other companies 1,312.8 934.6 Benefits paid (5,276.7) (5,502.7) Closing plan assets 59,385.6 49,805.1 Plan assets at the end of the year 59,385.6 49,805.1 Present value of the defined benefit obligations at the end of the year (57,801.5) (49,069.7) Amount not recognised as asset (limit in para 59(b) of AS-15 on ‘employee benefits’)1 (1,584.1) (735.4) Asset/(liability) - - Annual Report 2023-24 | 223 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Cost2 Service cost 3,066.3 2,458.4 Interest cost 3,762.0 3,024.7 Expected return on plan assets (4,135.5) (3,741.0) Actuarial (gain)/loss (475.2) 1,191.8 Effect of the limit in Para 59(b)1 848.6 (475.5) Net cost 3,066.2 2,458.4 Actual return on plan assets 5,351.9 3,412.0 Expected employer's contribution next year 3,311.6 2,655.0 Investment details of plan assets Government of India securities 54.31% 55.17% Corporate bonds 33.88% 35.12% Special deposit scheme 0.91% 1.08% Others 10.90% 8.63% Assumption Discount rate 7.20% 7.35% Expected rate of return on assets 7.84% 7.97% Discount rate for the remaining term to maturity of investments 7.20% 7.40% Average historic yield on the investment 7.84% 8.01% Guaranteed rate of return 8.25% 8.15% 1. Pursuant to revised Guidance Note 29 on “Valuation of Interest Rate Guarantees on Exempt Provident Funds under AS15 (Revised)” issued by the Institute of Actuaries of India on February 16, 2022, plan assets held by the PF Trust have been fair valued. The amount represents the fair value gain on plan assets. 2. Included in line item ‘Payments to and provision for employees’ of Schedule-16 Operating expenses. Experience adjustment ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2022 Year ended March 31, 2021 Year ended March 31, 2020 Plan assets 59,385.6 49,805.1 44,339.6 39,349.2 33,424.3 Defined benefit obligations (57,801.5) (49,069.7) (43,128.7) (39,349.2) (33,424.3) Amount not recognised as an asset (limit in para 59(b) of AS 15 on ‘employee benefits’)1 (1,584.1) (735.4) (1,210.9) - - Surplus/(deficit) - - - - - Experience adjustment on plan assets 1,216.4 (329.0) 246.3 530.5 (626.7) Experience adjustment on plan liabilities 300.3 476.1 (812.5) 1,467.8 (171.5) 1. Pursuant to revised Guidance Note 29 on “Valuation of Interest Rate Guaranatees on Exempt Provident Funds under AS15 (Revised)” issued by the Institute of Actuaries of India on February 16, 2022, plan assets held by the PF Trust have been fair valued. The amount represents the fair value gain on plan assets. 224 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The Bank has contributed `4,837.6 million to provident fund for the year ended March 31, 2024 (year ended March 31, 2023: ` 3,846.1 million), which includes compulsory contribution made towards employee pension scheme under Employees Provident Fund and Miscellaneous Provisions Act, 1952. Superannuation Fund The Bank has contributed ` 334.3 million for the year ended March 31, 2024 (year ended March 31, 2023: ` 302.0 million) to Superannuation Fund for employees who had opted for the scheme. National Pension Scheme (NPS) The Bank has contributed ` 349.3 million for the year ended March 31, 2024 (year ended March 31, 2023: ` 279.8 million) to NPS for employees who had opted for the scheme. Compensated absence The following table sets forth, for the periods indicated, movement in provision for compensated absence. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Total actuarial liability 3,715.8 3,079.8 Cost1 1,350.4 694.0 Assumptions Discount rate 7.20% 7.35% Salary escalation rate 8.00% 8.00% 1. Included in line item ‘Payments to and provision for employees’ of Schedule-16 Operating expenses. 41. Movement in provision for credit cards/debit cards/savings accounts and direct marketing agents reward points The following table sets forth, for the periods indicated, movement in provision for credit cards/debit cards/savings accounts reward points. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening provision for reward points 4,725.5 3,278.3 Provision for reward points made during the year 16,612.2 12,377.7 Utilisation/write-back of provision for reward points (14,686.6) (10,930.5) Closing provision for reward points1 6,651.1 4,725.5 1. The closing provision is based on the actuarial valuation of accumulated credit cards/debit cards/savings accounts reward points. The following table sets forth, for the periods indicated, movement in provision for reward points to direct marketing agents. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening provision for reward points 199.7 248.0 Provision for reward points made during the year 51.3 103.3 Utilisation/write-back of provision for reward points (132.9) (151.6) Closing provision for reward points 118.1 199.7 Annual Report 2023-24 | 225 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 42. Provisions and contingencies The following table sets forth, for the periods indicated, the break-up of provisions and contingencies included in profit and loss account. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Provisions for depreciation of investments1 6,887.9 12,995.4 Provision towards non-performing and other assets2 9,447.9 (6,222.9) Provision towards income tax 1. Current 120,506.5 102,544.8 2. Deferred 15,489.1 2,702.5 Other provisions and contingencies3,4 20,093.4 59,883.3 Total provisions and contingencies 172,424.8 171,903.1 1. During the year ended March 31, 2024, the Bank made a provision of ` 5,104.1 million against its investments in Alternate Investment Funds (AIFs) as per RBI circular dated December 19, 2023. 2. Includes provision towards NPA (net of write off, recoveries) amounting to ` 14,798.5 million (March 31, 2023: ` 10,166.1 million). 3. No contingency provision was made during the year ended March 31, 2024 (March 31, 2023: provision made ` 56,500.0 million). 4. Includes general provision made towards standard assets, provision on fixed assets acquired under debt-asset swap and non- fund based facilities. The Bank has assessed its obligations arising in the normal course of business, including pending litigations, proceedings pending with tax authorities and other contracts including derivative and long term contracts. In accordance with the provisions of AS 29 on ‘Provisions, Contingent Liabilities and Contingent Assets’, the Bank recognises a provision for material foreseeable losses when it has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. In cases where the available information indicates that the loss on the contingency is reasonably possible or the amount of loss cannot be reasonably estimated, a disclosure to this effect is made as contingent liabilities in the financial statements. The Bank does not expect the outcome of these proceedings to have a materially adverse effect on its financial results. The following table sets forth, for the periods indicated, the movement in provision for legal and fraud cases, operational risk and other contingencies. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening provision 41,291.0 43,991.3 Movement during the year (net) 6,210.6 (2,700.3) Closing provision 47,501.6 41,291.0 1. Excludes provision towards sundry expenses. 43. Provision for income tax The provision for income tax (including deferred tax) for the year ended March 31, 2024 amounted to ` 135,995.6 million (March 31, 2023: ` 105,247.3 million). The Bank has a comprehensive system of maintenance of information and documents required by transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. The Bank is of the opinion that all transactions with international related parties and specified transactions with domestic related parties are primarily at arm's length so that the above legislation does not have material impact on the financial statements. 226 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 44. Deferred tax At March 31, 2024, the Bank has recorded net deferred tax assets of ` 59,546.3 million (March 31, 2023: ` 75,034.5 million), which have been included in other assets. The following table sets forth, for the periods indicated, the break-up of deferred tax assets and liabilities into major items. ` in million Particulars At March 31, 2024 At March 31, 2023 Deferred tax assets Provision for bad and doubtful debts 93,946.8 104,040.7 Provision for operating expenses 4,026.9 4,026.9 Provision/MTM on investment 6,912.1 5,643.8 Provision for expense allowed on payment basis 4,183.3 3,262.5 Foreign currency translation reserve2 148.0 (615.0) Others 63.6 67.4 Total deferred tax assets 109,280.7 116,426.3 Deferred tax liabilities Special reserve deduction 44,338.6 36,735.9 Depreciation on fixed assets 4,953.9 4,449.7 Interest on refund of taxes2 441.9 206.2 Total deferred tax liabilities 49,734.4 41,391.8 Total net deferred tax assets/(liabilities) 59,546.3 75,034.5 1. Tax rate of 25.168% is applied based on Finance Act 2020. 2. These items are considered in accordance with the requirements of Income Computation and Disclosure Standards (ICDS). 45. Details of provisioning pertaining to fraud accounts The following table sets forth, for the periods indicated, the details of provisioning pertaining to fraud accounts. ` in million, except number of frauds Particulars Year ended March 31, 2024 Year ended March 31, 2023 Number of frauds reported 29,9932 6,642 Amount involved in frauds 8,166.1 3,853.9 Provision made1 2,423.6 1,570.8 Unamortised provision debited from balance in profit and loss account under ‘Reserves and Surplus’ - - 1. Excludes amount written off and interest reversal. 2. Includes digital payment related frauds as per RBI advisory issued on January 13,2024 46. Proposed dividend on equity shares The Board of Directors at its meeting held on April 27, 2024 has recommended a dividend of ` 10 per equity share for the year ended March 31, 2024 (year ended March 31, 2023: ` 8 per equity share). The declaration and payment of dividend is subject to requisite approvals. Annual Report 2023-24 | 227 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 47. Related party transactions The Bank has transactions with its related parties comprising subsidiaries, associates/joint ventures/other related entities, key management personnel and relatives of key management personnel. I. Related parties Subsidiaries, associates/joint ventures/other related entities Sr. No. Name of the entity Nature of relationship 1. ICICI Bank Canada Subsidiary 2. ICICI Bank UK PLC Subsidiary 3. ICICI Home Finance Company Limited Subsidiary 4. ICICI International Limited Subsidiary 5. ICICI Investment Management Company Limited Subsidiary 6. ICICI Lombard General Insurance Company Limited Subsidiary1 7. ICICI Prudential Asset Management Company Limited Subsidiary 8. ICICI Prudential Life Insurance Company Limited Subsidiary 9. ICICI Prudential Pension Funds Management Company Limited Subsidiary 10. ICICI Prudential Trust Limited Subsidiary 11. ICICI Securities Holdings Inc. Subsidiary 12. ICICI Securities Inc. Subsidiary 13. ICICI Securities Limited Subsidiary 14. ICICI Securities Primary Dealership Limited Subsidiary 15. ICICI Trusteeship Services Limited Subsidiary 16. ICICI Venture Funds Management Company Limited Subsidiary 17. I-Process Services (India) Private Limited Subsidiary2 18. Arteria Technologies Private Limited Associate 19. India Advantage Fund-III Associate 20. India Advantage Fund-IV Associate 21. India Infradebt Limited Associate 22. ICICI Merchant Services Private Limited Associate 23. NIIT Institute of Finance, Banking and Insurance Training Limited Associate 24. ICICI Strategic Investments Fund Consolidated as per Accounting Standard (‘AS’) 21 25. Comm Trade Services Limited Other related entity 26. ICICI Foundation for Inclusive Growth Other related entity 27. Cheryl Advisory Private Limited Other related entity 1. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. 2. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and became a wholly-owned subsidiary of the Bank w.e.f March 22, 2024. 228 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) Key management personnel Sr. no. Name of the Key management personnel Relatives of the Key management personnel 1. Mr. Sandeep Bakhshi • Ms. Mona Bakhshi • Mr. Shivam Bakhshi • Ms. Aishwarya Bakhshi • Ms. Esha Bakhshi • Ms. Minal Bakhshi • Mr. Sameer Bakhshi • Mr. Ritwik Thakurta • Mr. Ashwin Pradhan • Ms. Radhika Bakhshi 2. Mr. Anup Bagchi (Upto April 30, 2023) • Ms. Mitul Bagchi • Mr. Aditya Bagchi • Mr. Shishir Bagchi • Mr. Arun Bagchi 3. Mr. Sandeep Batra • Mr. Pranav Batra • Ms. Arushi Batra • Mr. Vivek Batra • Ms. Veena Batra 4. Mr. Rakesh Jha (w.e.f. September 2, 2022) • Mr. Narendra Kumar Jha • Mr. Navin Ahuja • Mr. Sharad Bansal • Ms. Aparna Ahuja • Ms. Apoorva Jha Bansal • Ms. Pushpa Jha • Ms. Sanjali Jha • Ms. Swati Jha 5. Ms. Vishakha Mulye (upto May 31, 2022) • Mr. Vivek Mulye • Ms. Vriddhi Mulye • Mr. Vighnesh Mulye • Dr. Gauresh Palekar • Ms. Shalaka Gadekar • Dr. Nivedita Palekar 6. Mr. Ajay Kumar Gupta (w.e.f March 15, 2024) • Dr. Shabnam Gupta • Mr. Akhil Gupta • Mr. Aneesh Gupta • Mr. Ashok Gupta • Mr. Vinay Gupta • Ms. Aparna Gupta • Ms. Madhu Gupta • Ms. Rita Agarwal • Ms. Shanti Gupta • Shyam Lall Gupta HUF Annual Report 2023-24 | 229 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) II. Transactions with related parties The following table sets forth, for the periods indicated, the significant transactions between the Bank and its related parties. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Interest income 847.7 884.6 Subsidiaries 484.8 448.8 Associates/joint ventures/others 362.0 432.6 Key management personnel 0.9 3.2 Income from services rendered 6,701.2 6,709.3 Subsidiaries 5,256.6 5,365.9 Associates/joint ventures/others 1,444.4 1,343.4 Key management personnel 0.0 0.0 Relatives of key management personnel 0.2 0.0 Gain/(loss) on forex and derivative transactions (net)2 101.1 (49.0) Subsidiaries 39.5 (99.8) Associates/joint ventures/others 61.6 50.8 Dividend income 20,729.1 17,845.6 Subsidiaries 18,146.2 15,498.5 Associates/joint ventures/others 2,582.9 2,347.1 Insurance claims received 2,330.6 1,809.4 Subsidiaries 2,293.3 1,650.0 Associates/joint ventures/others 37.3 159.4 Income from shared services 2,394.4 2,568.6 Subsidiaries 2,185.2 2,279.4 Associates/joint ventures/others 209.2 289.2 Interest expense 687.9 387.8 Subsidiaries 586.7 303.0 Associates/joint ventures/others 77.5 64.9 Key management personnel 14.4 15.3 Relatives of key management personnel 9.3 4.6 Expenses for services received 15,350.8 16,446.3 Subsidiaries 2,331.7 745.0 Associates/joint ventures/others 13,019.1 15,701.3 Insurance premium paid 9,572.7 9,521.8 Subsidiaries 6,971.4 6,717.7 Associates/joint ventures/others 2,601.3 2,804.1 Expenses for shared services and other payments 1,115.5 646.9 Subsidiaries 1,115.5 646.9 CSR related reimbursement of expenses 5,170.0 4,441.1 Associates/joint ventures/others 5,170.0 4,441.1 230 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Volume of fixed deposits placed 18,489.0 15,554.4 Subsidiaries 6,702.6 8,490.7 Associates/joint ventures/others 11,718.6 6,916.7 Key management personnel 37.2 121.2 Relatives of key management personnel 30.6 25.8 Volume of call/reverse repo/term money lent 1,021,540.0 444,200.0 Subsidiaries 1,021,540.0 444,200.0 Purchase of investments 33,904.2 16,750.8 Subsidiaries 33,904.2 16,750.8 Investments in the securities issued by related parties 19,455.9 - Subsidiaries 2,200.0 - Associates/joint ventures/others 17,255.9 - Capital Infusion - 2,649.9 Subsidiaries - 2,649.9 Sale of investments 36,060.1 56,799.5 Subsidiaries 23,420.8 41,334.4 Associates/joint ventures/others 12,639.3 15,465.1 Redemption/buyback of investments by Bank - 50.0 Subsidiaries - 50.0 Redemption/buyback of investments by related parties 2,500.0 - Associates/joint ventures/others 2,500.0 - Purchase of loans 39,196.7 20,574.6 Subsidiaries 39,196.7 20,574.6 Loan given3 2,000.0 1,250.0 Subsidiaries 2,000.0 1,250.0 Funded/Unfunded risk participation 4,802.5 - Subsidiaries 4,802.5 - Purchase of fixed assets 1.7 4.9 Subsidiaries - 1.5 Associates/joint ventures/others 1.7 3.4 Forex/swaps/derivatives and forwards transactions entered (notional value) 146,228.2 140,654.5 Subsidiaries 139,288.4 134,034.7 Associates/joint ventures/others 6,939.8 6,619.8 Guarantees/letters of credit given by the Bank 258.7 91.5 Subsidiaries 258.6 86.5 Associates/joint ventures/others 0.1 5.0 Guarantees/letters of credit given by the related parties 680.3 83.4 Subsidiaries 680.3 83.4 Annual Report 2023-24 | 231 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Remuneration to wholetime directors4 287.0 336.6 Key management personnel 287.0 336.6 Dividend paid 5.0 3.8 Key management personnel 4.2 3.1 Relatives of key management personnel 0.8 0.7 Value of employee stock options exercised 56.5 290.6 Key management personnel 56.5 290.6 Sale of fixed assets 1.5 0.2 Subsidiaries 1.5 - Key management personnel - 0.2 1. 0.0 represents insignificant amount. 2. The Bank undertakes derivative transactions with its subsidiaries, associates, joint ventures and other related entities. The Bank manages its foreign exchange and interest rate risks arising from these transactions by covering them in the market. While the Bank, within its overall position limits covers these transactions in the market, the above amounts represent only the transactions with its subsidiaries, associates, joint ventures and other related entities and not the offsetting/covering transactions. 3. Represents disbursement of term loan. Related parties also avail working capital facilities, intra-day facility and derivative facility, which are revolving in nature. Volume of these facilities cannot be ascertained and outstanding balance, if any, are reported suitably. 4. Excludes the perquisite value on employee stock options exercised and includes performance bonus paid during the period. III. Material transactions with related parties The following table sets forth, for the periods indicated, the material transactions between the Bank and its related parties. A specific related party transaction is disclosed as a material related party transaction wherever it exceeds 10% of all related party transactions in that category. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Interest income 1 India Infradebt Limited 348.2 419.0 2 ICICI Securities Primary Dealership Limited 287.8 116.6 3 ICICI Home Finance Company Limited 167.0 317.0 Income from services rendered 1 ICICI Prudential Life Insurance Company Limited 3,274.8 3,927.8 2 ICICI Lombard General Insurance Company Limited 1,451.0 1,192.5 3 ICICI Securities Limited 1,091.1 858.2 Gain/(loss) on forex and derivative transactions (net) 1 ICICI Lombard General Insurance Company Limited 73.8 50.8 2 ICICI Securities Primary Dealership Limited 15.4 124.2 3 ICICI Bank Canada 8.0 (11.1) 4 ICICI Home Finance Company Limited 0.0 (211.3) 232 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Dividend income 1 ICICI Prudential Asset Management Company Limited 7,535.2 6,220.8 2 ICICI Securities Limited 5,135.1 5,437.2 3 ICICI Lombard General Insurance Company Limited 2,476.4 2,240.5 4 ICICI Bank Canada 2,139.5 1,061.6 Insurance claims received 1 ICICI Prudential Life Insurance Company Limited 2,287.9 1,650.0 Income from shared services 1 ICICI Bank UK PLC 682.7 540.8 2 ICICI Securities Limited 461.1 536.4 3 ICICI Bank Canada 361.6 326.8 4 ICICI Prudential Life Insurance Company Limited 162.5 384.0 Interest expense 1 ICICI Securities Limited 562.5 289.8 Expenses for services received 1 I-Process Services (India) Private Limited 11,895.6 10,406.5 2 ICICI Merchant Services Private Limited 2,060.9 5,225.3 Insurance premium paid 1 ICICI Prudential Life Insurance Company Limited 6,721.7 6,717.7 2 ICICI Lombard General Insurance Company Limited 2,851.0 2,804.1 Expenses for shared services and other payments 1 ICICI Home Finance Company Limited 1,047.2 599.6 CSR related reimbursement of expenses 1 ICICI Foundation for Inclusive Growth 5,170.0 4,441.1 Volume of fixed deposits placed 1 I-Process Services (India) Private Limited 6,122.9 4,548.7 2 ICICI Securities Limited 6,035.5 7,478.8 3 ICICI Merchant Services Private Limited 5,330.0 2,000.0 Volume of call/reverse repo/term money lent 1 ICICI Securities Primary Dealership Limited 1,021,540.0 444,200.0 Purchase of investments 1 ICICI Securities Primary Dealership Limited 28,947.2 16,246.1 2 ICICI Prudential Life Insurance Company Limited 4,706.8 504.8 Investments in the securities issued by related parties 1 India Infradebt Limited 17,255.9 - 2 ICICI Home Finance Company Limited 2,200.0 - Capital Infusion 1 ICICI Home Finance Company Limited - 2,500.0 Annual Report 2023-24 | 233 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Sale of investments 1 ICICI Prudential Life Insurance Company Limited 10,617.5 19,408.7 2 ICICI Securities Primary Dealership Limited 10,585.7 21,625.8 3 India Infradebt Limited 7,617.1 7,019.7 4 ICICI Lombard General Insurance Company Limited 7,239.8 8,445.4 Redemption/buyback of investments by Bank 1 ICICI Securities Limited - 50.0 Redemption/buyback of investments by related parties 1 India Infradebt Limited 2,500.0 - Purchase of loans 1 ICICI Home Finance Company Limited 39,196.7 19,290.7 Loan given 1 ICICI Home Finance Company Limited 2,000.0 1,250.0 Funded/Unfunded risk participation 1 ICICI Bank UK PLC 4,802.5 - Purchase of fixed assets 1 Arteria Technologies Private Limited 1.7 3.2 2 ICICI Home Finance Company Limited - 1.3 Forex/swaps/derivatives and forwards transactions entered (notional value) 1 ICICI Bank UK PLC 89,253.0 81,534.0 2 ICICI Bank Canada 41,389.6 18,916.5 3 ICICI Home Finance Company Limited 5.3 24,151.2 Guarantees/letters of credit given by the Bank 1 ICICI Prudential Asset Management Company Limited 100.0 - 2 ICICI Bank Canada 88.5 31.2 3 ICICI Bank UK PLC 69.5 54.2 Guarantees/letters of credit given by the related parties 1 ICICI Bank UK PLC 659.4 83.4 Remuneration to wholetime directors 1 Mr. Sandeep Bakhshi 99.7 95.7 2 Mr. Sandeep Batra 86.7 85.3 3 Mr. Rakesh Jha 84.0 45.9 4 Mr. Anup Bagchi 13.7 86.5 5 Mr. Ajay Kumar Gupta 2.9 N.A. 6 Ms. Vishakha Mulye N.A. 23.2 Dividend paid 1 Mr. Sandeep Bakhshi 2.2 1.7 2 Mr. Sandeep Batra 1.4 0.6 234 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 3 Mr. Rakesh Jha 0.6 0.7 4 Mr. Shivam Bakhshi 0.3 0.4 Value of employee stock options exercised 1 Mr. Sandeep Bakhshi 4.7 27.2 2 Mr. Sandeep Batra 13.3 6.4 3 Mr. Rakesh Jha 38.5 - 4 Mr. Anup Bagchi - 183.2 5 Ms. Vishakha Mulye N.A. 73.8 Sale of fixed assets 1 ICICI Prudential Life Insurance Company Limited 1.5 - 2 Mr. Rakesh Jha - 0.1 3 Ms. Vishakha Mulye N.A. 0.1 1. 0.0 represents insignificant amount. IV. Related party outstanding balances The following table sets forth, for the periods indicated, the balances payable to/receivable from related parties. ` in million Particulars At March 31, 2024 At March 31, 2023 Deposits accepted 24,444.3 24,829.0 Subsidiaries 21,987.1 21,913.1 Associates/joint ventures/others 2,023.2 2,603.0 Key management personnel 294.7 224.6 Relatives of key management personnel 139.3 88.3 Investments of related parties in the Bank 2.3 1.2 Key management personnel 2.1 1.0 Relatives of key management personnel 0.2 0.2 Payables1 4,174.7 3,860.5 Subsidiaries 1,017.4 142.1 Associates/joint ventures/others 3,156.3 3,717.0 Key management personnel 0.2 0.4 Relatives of key management personnel 0.8 1.0 Deposits placed by the Bank 2,122.4 1,519.9 Subsidiaries 2,122.4 1,519.9 Call/term money lent by the Bank - 6,000.0 Subsidiaries - 6,000.0 Investments of the Bank 121,270.7 94,344.5 Subsidiaries 111,327.0 69,772.9 Associates/joint ventures/others 9,943.7 24,571.6 Annual Report 2023-24 | 235 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars At March 31, 2024 At March 31, 2023 Advances by the Bank 3,267.6 3,280.6 Subsidiaries 3,075.0 3,003.2 Associates/joint ventures/others 123.0 191.3 Key management personnel 68.8 85.7 Relatives of key management personnel 0.8 0.4 Receivables1 3,804.3 3,633.8 Subsidiaries 3,577.7 2,190.4 Associates/joint ventures/others 226.6 1,443.4 Guarantees/letters of credit/indemnity given by the Bank 1,148.0 1,370.4 Subsidiaries 1,087.8 1,307.3 Associates/joint ventures/others 60.2 63.1 Guarantees/letters of credit/indemnity issued by related parties 927.1 806.5 Subsidiaries 927.1 806.5 Swaps/forward contracts (notional amount) 12,646.1 10,648.9 Subsidiaries 12,646.1 10,648.9 Funded/Unfunded risk participation 806.3 953.3 Subsidiaries 806.3 953.3 1. Excludes mark-to-market on outstanding derivative transactions. V. Related party maximum balances The following table sets forth, for the periods indicated, the maximum balances payable to/receivable from related parties. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Deposits accepted Subsidiaries 31,501.6 27,024.5 Associates/joint ventures/others 6,815.5 7,119.8 Key management personnel 295.1 384.6 Relatives of key management personnel 139.3 258.6 Investments of related parties in the Bank1 Subsidiaries - 48.8 Key management personnel 2.1 1.8 Relatives of key management personnel 0.2 0.3 Payables1,2 Subsidiaries 1,017.4 169.8 Associates/joint ventures/others 6,628.1 6,028.6 Key management personnel 0.3 0.4 Relatives of key management personnel 0.9 1.0 Deposits placed by the Bank Subsidiaries 6,522.9 3,461.2 236 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Call/term money lent by the Bank Subsidiaries 10,563.3 11,083.0 Investments of the Bank Subsidiaries 111,327.0 69,772.9 Associates/joint ventures/others 42,350.7 27,932.0 Advances by the Bank Subsidiaries 16,369.2 9,608.9 Associates/joint ventures/others 224.0 195.3 Key management personnel 85.7 139.2 Relatives of key management personnel 2.5 2.3 Receivables1,2 Subsidiaries 8,414.3 3,930.7 Associates/joint ventures/others 2,302.1 2,181.0 Guarantees/letters of credit/indemnity given by the Bank Subsidiaries 1,469.2 2,487.1 Associates/joint ventures/others 63.1 63.1 Guarantees/letters of credit/indemnity issued by related parties1 Subsidiaries 1,483.9 859.1 Swaps/forward contracts (notional amount) Subsidiaries 16,750.2 55,163.8 Funded/Unfunded risk participation1 Subsidiaries 2,292.1 959.7 1. Maximum balance is determined based on comparison of the total outstanding balances at each quarter end during the financial year. 2. Excludes mark-to-market on outstanding derivative transactions. VI. Letters of comfort The Bank issues letters of comfort (LoCs) on behalf of its subsidiaries. As required by Reserve Bank of India, the Bank has carried out an annual financial assessment of LoCs issued on behalf of its subsidiaries, and there is no financial impact arising from the outstanding LoCs at March 31, 2024 as detailed below. The Bank has issued a LoC on behalf of its banking subsidiary ICICI Bank UK PLC to Financial Services Authority, UK (now split into two separate regulatory authorities, the Prudential Regulation Authority and the Financial Conduct Authority) to confirm that the Bank intends to financially support ICICI Bank UK PLC in ensuring that it meets all of its financial obligations as they fall due. There was no financial impact of this LoC on the Bank at March 31, 2024. The Bank has issued a LoC on behalf of its banking subsidiary ICICI Bank Canada to the Office of the Superintendent of Financial Institutions (OSFI), Canada to confirm that it shall provide an ongoing financial, managerial and operational support to ICICI Bank Canada. There was no financial impact of this LoC on the Bank at March 31, 2024. Annual Report 2023-24 | 237 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The Bank has issued an undertaking on behalf of ICICI Securities Inc. Singapore for Singapore dollar 10.0 million (currently equivalent to ` 617.4 million) (March 31, 2023: ` 617.9 million) to the Monetary Authority of Singapore (MAS) and has also executed seven (March 31, 2023: six) indemnity agreements on behalf of ICICI Bank Canada to its independent directors for a sum not exceeding Canadian dollar 2.5 million each (currently equivalent to ` 153.2 million), aggregating to Canadian dollar 17.5 million [currently equivalent to ` 1,072.2 million (March 31, 2023: ` 910.0 million)]. The aggregate amount of ` 1,689.5 million at March 31, 2024 (March 31, 2023: ` 1,527.9 million) is included in the contingent liabilities. At the time of demerger of general insurance business of Bharti AXA General Insurance Co. Ltd. to ICICI Lombard General Insurance Co. Ltd. (ICICI General), and subsequently in relation to increase of Bank’s shareholding in ICICI General upto 4% in multiple tranches, the Bank had issued undertakings to Insurance Regulatory and Development Authority of India (IRDAI) that it shall infuse capital, if required by ICICI General, in proportion to its shareholding in ICICI General at the relevant time to meet its business and/or solvency requirements. There was no financial impact of these LoCs on the Bank at March 31, 2024. In addition to the above, the Bank has also issued LoCs in the nature of letters of awareness on behalf of its non- banking financial subsidiaries ICICI Prudential Life Insurance Co. Ltd. and ICICI Home Finance Co. Ltd. for other incidental business purposes, to maintain ownership stake and to give information about the ownership and management. These letters of awareness are in the nature of factual statements or confirmation of facts and do not create any financial impact on the Bank. 48. Details of amount transferred to The Depositor Education and Awareness Fund (the Fund) of RBI The following table sets forth, for the periods indicated, the movement in amount transferred to the Fund. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening balance 16,270.6 14,398.8 Add: Amounts transferred during the year 2,266.4 2,150.6 Less: Amounts reimbursed by the Fund towards claims during the year (840.7) (278.8) Closing balance 17,696.3 16,270.6 1. Amount transferred to DEAF is included under "Schedule 12 - Contingent Liabilities - Other items". 49. Details of payment of DICGC insurance premium The following table sets forth, for the periods indicated, the payment of insurance premium and arrears. ` in million Sr. No. Particulars Year ended March 31, 2024 Year ended March 31, 2023 1. Payment of DICGC Insurance Premium1 14,532.6 12,673.7 2. Arrears in payment of DICGC premium - - 1. Excludes goods and service tax. 238 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 50. Small and micro enterprises The following table sets forth, for the periods indicated, details relating to enterprises covered under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006. ` in million Sr. No. Particulars At March 31, 2024 At March 31, 2023 Principal Interest Principal Interest 1. The Principal amount and the interest due thereon remaining unpaid to any supplier - - - - 2. The amount of interest paid by the buyer in terms of Section 16, along with the amount of the payment made to the supplier beyond the due date - - - - 3. The amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the due date during the year) but without adding the interest specified under MSMED Act, 2006 - 0.2 - 0.1 4. The amount of interest accrued and remaining unpaid - 0.2 - 0.1 5. The amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid to the small enterprise, for the purpose of disallowed as a deductible expenditure under Section 23 - - - - 51. Penalties/fines imposed by RBI and other banking regulatory bodies RBI imposed a penalty of ` 121.9 million on October 17, 2023 based on the deficiency observed in regulatory compliance with the Banking Regulation Act, during statutory inspection for supervision evaluation (ISE 2020 and ISE 2021) of the Bank conducted by RBI (year ended March 31, 2023: Nil). 52. Disclosure on Remuneration Compensation policy and practices (A) Qualitative Disclosures a) Bodies that oversee remuneration. • Name, composition and mandate of the main body overseeing remuneration The Board Governance, Remuneration and Nomination Committee (BGRNC/ Committee) is the body which oversees the remuneration aspects. The functions of the Committee include recommending appointments of Directors to the Board, identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down and recommending to the Board their appointment and removal, formulate a criteria for the evaluation of the performance of the whole time/ independent Directors and the Board and to extend or continue the term of appointment of independent Directors on the basis of the report of performance evaluation of independent Directors, recommending to the Board a policy relating to the remuneration for the Directors, Key Managerial Personnel, Material Risk takers (MRTs) and other employees, recommending to the Board the remuneration (including performance bonus, share-linked instruments and perquisites) to wholetime Directors (WTDs) and senior management, approving the policy for and quantum of variable pay payable to members of the staff including senior management, key managerial personnel, material risk takers and formulating the criteria for determining qualifications, Annual Report 2023-24 | 239 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) positive attributes and independence of a Director, framing policies on Board diversity, framing guidelines for the Employees Stock Option Scheme, Employees Stock Unit Scheme and deciding on the grant of the Bank’s stock options/ units to employees and WTDs of the Bank and its subsidiary companies, as applicable. • External consultants whose advice has been sought, the body by which they were commissioned, and in what areas of the remuneration process. During the year ended March 31, 2024, the Bank employed the services of a reputed consulting firm for market benchmarking in the area of compensation, including executive compensation. • Scope of the Bank’s remuneration policy (eg. by regions, business lines), including the extent to which it is applicable to foreign subsidiaries and branches The Compensation Policy of the Bank, as last amended by the BGRNC and the Board at their Meetings held on February 17, 2024 and February 15-17, 2024. The Policy covers all employees of the Bank, including those in overseas branches of the Bank. In addition to the Bank’s Compensation Policy guidelines, the overseas branches also adhere to relevant local regulations. • Type of employees covered and number of such employees All employees of the Bank are governed by the Compensation Policy. The total number of permanent employees of the Bank at March 31, 2024 was 135,900. b) Design and structure of remuneration processes • Key features and objectives of remuneration policy The Bank has under the guidance of the Board and the BGRNC, followed compensation practices intended to drive performance within the framework of prudent risk management. This approach has been incorporated in the Compensation Policy, the key elements of which are given below. o Effective governance of compensation: The BGRNC has oversight over compensation. The Committee defines Key Performance Indicators (KPIs) for WTDs and equivalent positions and the organisational performance norms for variable pay based on the financial and strategic plan approved by the Board. The KPIs include both quantitative and qualitative aspects defined with sub parameters. The BGRNC assesses organisational performance and based on its assessment, it makes recommendations on variable pay for employees. It also recommends to the Board the compensation for WTDs & equivalent positions and senior management subject to necessary approvals, wherever applicable. • Alignment of compensation philosophy with prudent risk taking: The Bank seeks to achieve a prudent mix of fixed and variable pay, with a higher proportion of variable pay at senior levels and no guaranteed bonuses. Compensation is sought to be aligned to both financial and non- financial indicators of performance including aspects like risk management, other assurance areas like compliance & audit functions and customer service. The Bank’s performance management framework is based on the "One Bank, One Team" approach emphasising the overall performance of the Bank, within the guardrails of risk and compliance. The Bank’s Employees stock option scheme and Employees stock unit scheme aim at aligning compensation to long-term performance through grants that vest over a period of time. Compensation of staff in audit, compliance and risk control functions is independent of the business areas they oversee. Changes, if any, made by the remuneration committee in the firm’s remuneration policy during the past year, and if so, an overview of any changes that were made. 240 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) During the year ended March 31, 2024, the Bank’s Compensation Policy was reviewed by the BGRNC and Board as below: BGRNC date Board date Overview of Changes April 21, 2023 April 22, 2023 • Incorporating appropriate delegation on the basis of organization structure. • Employees receiving both Performance linked retention pay (PLRP) and share-linked instruments to be covered under clawback • Change in the criteria for determining MRTs Circular resolution dated November 17, 2023 November 24, 2023 • To capture the treatment of variable pay (cash and share- linked instruments) in case of retirement or resignation. To align with the amendments in the New York Stock Exchange (NYSE) Listed Company Manual (U.S. Securities Regulations). February 17, 2024 February 15-17, 2024 • In order to align the policy in line with the RBI guidelines dated February 9, 2024 relating to compensation for non- executive Directors (other than part-time non-executive Chairman) • Process followed by the Bank to ensure that the risk and compliance employees are remunerated independently of the businesses they oversee:  The compensation of staff engaged in assurance functions like Audit, Risk and Compliance depends on their performance, which is based on achievement of the key goals of their respective functions. They are not assessed on business targets. c) Ways in which current and future risks are taken into account in the remuneration processes. • Key risks that the Bank takes into account when implementing remuneration measures The Board approves the Enterprise Risk Management framework (ERM) and Risk Appetite Framework (RAF) for the Bank. The business activities of the Bank are undertaken within this framework. The RAF includes the definition of risk capacity, risk appetite statements and drill down of the same into limits/thresholds for various risk categories. The Bank’s KPIs which are applicable to WTDs & equivalent positions as well as employees (excluding assurance functions), incorporated relevant risk management related aspects. For example, in FY2024, in addition to performance indicators in areas such as Profit before tax excluding treasury gains, performance indicators included aspects such as asset quality, risk management framework, stakeholder relationships, customer service and leadership development. The BGRNC takes into consideration all the above aspects while assessing organisational performance and making compensation-related recommendations to the Board. • Nature and type of key measures used to take account of these risks, including risk difficult to measure. The annual Key Performance Indicators and performance evaluation incorporated both qualitative and quantitative aspects including, risk management framework, stakeholder relationships, timely compliance and closure of audit issues, customer service and leadership development. • Ways in which these measures affect remuneration Every year, the financial plan/targets are formulated in conjunction with a risk framework with limit structures for various areas of risk/lines of business, within which the Bank operates. To ensure Annual Report 2023-24 | 241 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) effective alignment of compensation with prudent risk taking, the BGRNC takes into account adherence to the risk framework in conjunction with which the financial plan/targets have been formulated. The Bank’s KPIs which are applicable to WTDs and equivalent positions as well as employees (excluding assurance functions), incorporated relevant risk management related aspects and regulatory compliance. For example, in FY2024, in addition to profit before tax excluding treasury gains, performance indicators also included aspects such as asset quality, risk management framework, stakeholder relationships, customer service and leadership development. The BGRNC takes into consideration all the above aspects while assessing organisational performance and making compensation-related recommendations to the Board. • The nature and type of these measures that have changed over the past year and reasons for the changes, as well as the impact of changes on remuneration. The nature and type of these measures have not changed over the past year and hence, there is no impact on remuneration. d) Ways in which the Bank seeks to link performance during a performance measurement period with levels of remuneration • Main performance metrics for Bank, top level business lines and individuals The main performance metrics for FY2024 included profit before tax excluding treasury gains, regulatory compliance, risk management processes, stakeholder relationships, customer service and leadership development. • Methodology followed whereby individual remuneration is linked to the Bank-wide and individual performance The BGRNC takes into consideration above mentioned aspects while assessing performance and making compensation-related recommendations to the Board regarding the performance assessment of WTDs and equivalent positions. • The measures that the Bank will in general implement to adjust remuneration in the event that performance metrics are weak, including the Bank’s criteria for determining ‘weak’ performance metrics The Bank’s Compensation Policy outlines the measures the Bank will implement in the event of a reasonable evidence of deterioration in financial performance. Should such an event occur in the manner outlined in the policy, the BGRNC may decide to apply malus/clawback on none, part or all of the relevant variable compensation. e) Ways in which the Bank seeks to adjust remuneration to take account of the longer term performance • The Bank’s policy on deferral and vesting of variable remuneration and, if the fraction of variable remuneration that is deferred differs across employees or groups of employees, a description of the factors that determine the fraction and their relative importance The variable compensation is in the form of share-linked instruments or cash or a mix of cash and share-linked instruments. The quantum of variable pay for an employee does not exceed a certain percentage (as stipulated in the compensation policy) of the total fixed pay in a year. The proportion of variable pay to total compensation is higher at senior levels and lower at junior levels. At least 50% of the compensation is variable for WTDs, CEO and MRTs as a design. However, they can earn lesser variable pay based on various performance criteria. For WTDs, CEO and MRTs, a minimum of 60% of the total variable pay is under deferral arrangement (deferment). Additionally, at least 50% of the cash component of the variable pay is under deferment. If the cash component is under ` 2.5 million, the deferment is not applicable. 242 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) • The Bank’s policy and criteria for adjusting deferred remuneration before vesting and (if permitted by national law) after vesting through claw back arrangements The deferred portion of variable pay pertaining to the assessment year or previous year/s (as defined in the policy) is subject to malus, under which the Bank prevents vesting of all or part or none of the unvested variable pay in the event of the assessed divergence in the Bank’s provisioning for NPAs or in the event of a reasonable evidence of deterioration in financial performance or in the event of gross misconduct and/or other acts as mentioned in the policy. In such cases (other than assessed divergence), variable pay already paid out may also be subjected to clawback arrangements, as defined in the compensation policy. f) Different forms of variable remuneration that the Bank utilises and the rationale for using these different forms • Forms of variable remuneration offered. A discussion of the use of different forms of variable remuneration and, if the mix of different forms of variable remuneration differs across employees or group of employees, a description of the factors that determine the mix and their relative importance The variable compensation is in the form of share-linked instruments or cash or a mix of cash and share-linked instruments. The Bank pays performance linked retention pay (PLRP) to its front-line staff and junior management. PLRP aims to reward front line and junior managers, mainly on the basis of skill maturity attained through experience and continuity in role which is a key differentiator for customer service. The Bank pays performance bonus and share-linked instruments to relevant employees in its middle and senior management. The variable pay payout schedules are sensitive to the time horizon of risks as defined in the policy. The Bank ensures higher proportion of variable pay at senior levels and lower variable pay for front- line staff and junior management levels (B) Quantitative disclosures: The following table sets forth, for the period indicated, the details of quantitative disclosure for remuneration of WTDs (including MD & CEO) and other Material Risk Takers. ` in million except numbers Particulars Year ended March 31, 2024 Year ended March 31, 2023 1. Number of meetings held by the BGRNC during the financial year 7 5 Remuneration paid to its members during the financial year (sitting fees) 2.1 1.5 2. Number of employees having received a variable remuneration award during the financial year1 52 48 3. Number and total amount of sign-on/joining bonus made during the financial year - - 4. Details of severance pay, in addition to accrued benefits, if any - - Annual Report 2023-24 | 243 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) ` in million except numbers Particulars Year ended March 31, 2024 Year ended March 31, 2023 5. Breakdown of amount of remuneration awards for the financial year Fixed2 Variable3 - Deferred - Non-deferred Share-linked instruments3 (nos.) - Deferred (nos.) - Non-deferred (nos.) 1,067.4 510.8 247.9 262.9 3,731,800 3,731,800 - 1,142.9 485.6 246.6 239.0 4,277,800 4,277,800 - 6. Total amount of deferred remuneration paid out during the year - Bonus4 - Share-linked instruments4 (nos.) 146.3 5,628,640 68.0 8,015,135 7. Total amount of outstanding deferred remuneration Cash5 Shares (nos.) Shares-linked instruments5 (nos.) Other 474.7 - 8,368,690 - 381.8 - 10,311,910 - 8. Total amount of outstanding deferred remuneration and retained remuneration exposed to ex-post explicit and/or implicit adjustments - Bonus - Share-linked instruments (nos.) 474.7 8,368,690 381.8 10,311,910 9. Total amount of reductions during the year due to ex-post explicit adjustments6 N.A. N.A. 10. Total amount of reductions during the year due to ex-post implicit adjustments N.A. N.A. 11. Number of MRTs identified7 43 42 12. Number of cases where malus has been exercised - - Number of cases where clawback has been exercised6 - - Number of cases where malus and clawback have been exercised - - 13. The mean pay for the bank as a whole (excluding sub-staff) and the deviation of the pay of each of its WTDs from the mean pay (in `) Mean pay of the bank8 Deviation - MD&CEO9 Deviation - WTD19 Deviation - WTD29 Deviation - WTD39 8,57,602 70,278,131 63,484,688 63,180,904 34,907,850 790,345 74,214,867 52,075,390 67,836,208 65,872,493 1. Includes MD & CEO, WTDs and other Material Risk Takers (MRTs) based on the revised criteria given by RBI in its guideline dated November 4, 2019. Also includes MRTs who have resigned, retired or transferred to group companies (separated) and were paid bonus or stock options granted/vested during the year. Variable remuneration includes cash bonus and stock options (as per RBI guideline dated November 4, 2019) that are paid/ granted/ vested during the year. 2. Fixed pay includes basic salary, supplementary allowances, superannuation, and contribution to provident fund, gratuity fund and value of perquisites. The value of perquisites is calculated as cost to the Bank. The salaries of separated MRTs have been considered for the period they were in service with the Bank during the fiscal year. For FY2023, the remuneration approved for FY2022 (as paid during FY2023) has been considered for MD & CEO and WTDs. 244 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 3. Variable and share-linked instruments represent amounts/ options awarded for the year ended March 31, 2022 and March 31, 2023 as per RBI approvals wherever applicable. 4. Includes deferred bonus/options that was paid/vested during the year. 5. Includes outstanding bonus/options at the end of the financial year. 6. Excludes ` 74.1 million variable pay to the former MD & CEO for past years which has been directed for claw-back in respect of which the Bank has filed a recovery suit against the former MD & CEO. 7. Includes MD & CEO/WTDs/and other active MRT based on the revised criteria given by RBI in its guidelines dated November 4, 2019. 8. Mean pay is computed on annualised fixed pay that includes basic salary, supplementary allowances, superannuation, contribution to provident fund, gratuity fund and value of perquisites. The value of perquisite is calculated as cost to the Bank. 9. Incumbents are different for FY2024 and FY2023. Payment of compensation in the form of remuneration to the Non-Executive Directors For the year ended March 31, 2024, fixed remuneration of ` 14.2 million has been paid to Non-Executive Directors/ Independent Directors (other than part-time chairman). Mr. Girish Chandra Chaturvedi (part-time Chairman) was paid a remuneration of ` 3.5 million during FY2024 excluding sitting fees. Pursuant to RBI circular dated February 9, 2024, each Non-Executive Directors/Independent Directors (other than part-time chairman) will be paid a remuneration of ` 3.0 million per annum on a pro-rata basis with effect from February 10, 2024, subject to approval of the shareholders. During the year ended March 31, 2024, provision of ` 1.1 million has been made for making payment for the difference on account of the enhancement on receipt of shareholders approval. For the year ended March 31, 2023, fixed remuneration of ` 14.0 million had been paid to Non-Executive Directors/ Independent Directors (other than part-time chairman) and Mr. Girish Chandra Chaturvedi (part-time Chairman) was paid a remuneration of ` 3.5 million excluding sitting fees. 53. CORPORATE SOCIAL RESPONSIBILITY The Corporate Social Responsibility (CSR) spending obligation for the Bank during the year ended March 31, 2024 was ` 5,172.6 million (March 31, 2023: ` 4,078.4 million). ` in million Particulars As at March 31, 2024 As at March 31, 2023 Total CSR obligation for the financial year1 5,172.6 4,078.4 Amount of expenditure incurred1 3,684.7 4,766.5 Amount in unspent CSR account/ yet to be paid in cash at the end of the year2 1,504.0 - Details of related party transactions (ICICI Foundation for Inclusive Growth)3 5,170.0 4,441.1 1. Includes spends from surplus generated from CSR activities that was transferred to the Unspent CSR Account and spent within stipulated timeline, as required by law (FY2024: ` 171.2 million; FY2023: ` 139.9 million). 2. ` 1,500.0 million was budgeted in FY2024 for ongoing project with Tata Memorial Centre but remained unspent. The amount was transferred to the Unspent CSR Account in April 2024 and would be spent over three years, as per CSR rules. 3. Includes spends from surplus generated from CSR activities that was transferred to unspent CSR account and spent through ICICI Foundation within stipulated timeline, as required by law (FY2024: ` 171.2 million; FY2023: ` 40.0 million). Annual Report 2023-24 | 245 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) CSR activities during FY2024 were in the areas of affordable and accessible healthcare, environmental and ecological projects like afforestation and rainwater harvesting, livelihood projects and social interventions. The following table sets forth, for the periods indicated, the amount spent by the Bank on CSR related activities. ` in million Sr. No. Particulars Year ended March 31, 2024 Year ended March 31, 2023 In cash Yet to be paid in cash Total In cash Yet to be paid in cash Total 1. Construction/ acquisition of any asset - - - - - - 2. On purposes other than (1) above1 3,684.7 1,504.0 5,188.7 4,626.6 - 4,626.6 1. For the year ended March 31, 2024, out of the amount (yet to be paid in cash), as required under the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021, ` 1,500.0 million budgeted in FY2024 for ongoing project with Tata Memorial Centre but which remained unspent, was transferred to the Unspent CSR Account in April, 2024 and would be spent over three years, as per CSR rules. Balance ` 4.0 million pertains to provision made for CSR expenses of FY2024 and amount is yet to be paid. The following table sets forth, for the periods indicated, the details of movement in provision pertaining to CSR related activities ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening balance of provision - 24.9 Add: Provision for expenses during the year 1,504.0 - Less: Payment out of opening balance - 24.9 Closing balance of provision 1,504.0 - 54. Green deposits The Bank has not yet offered green deposits to its customers. 55. Disclosure of customer complaints The following table sets forth, for the periods indicated, the movement of complaints received by the Bank from its customers. Particulars Year ended March 31, 2024 Year ended March 31, 2023 a. No. of complaints pending at the beginning of the year 14,429 10,401 b. No. of complaints received during the year 346,314 248,337 c. No. of complaints disposed during the year 338,204 244,309 3a. Of which, number of complaints rejected by the Bank 149,458 101,227 d. No. of complaints pending at the end of the year 22,539 14,429 1. Complaints do not include complaints redressed by the Bank within one working day. 246 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, for the periods indicated, the summary of overall complaints. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 (A) Total number of complaints 534,414 418,992 (B) Complaints redressed by the Bank within one working day 188,100 170,655 (C) Net reported complaints (A-B) 346,314 248,337 The following table sets forth, for the periods indicated, the details of maintainable complaints received. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 i. Number of maintainable complaints received by the Bank from Office of Banking Ombudsmans (OBOs)1 14,284 12,114 Of (i), number of complaints resolved in favour of the Bank by Banking Ombudsmans (BOs) 7,407 5,627 Of (i), number of complaints resolved through conciliation/ mediation/advisories issued by BOs2 6,877 6,487 Of (i), number of complaints resolved after passing of Awards by BOs against the Bank - - ii. Number of Awards unimplemented within the stipulated time (other than those appealed) - - 1. Maintainable complaints are as per data received from RBI. 2. For year ended March 31, 2024: 683 complaints (March 31, 2023: 432 complaints) were resolved based on advisories received from BOs. The following table sets forth, top five grounds of complaints received by the Bank from customers for the year ended March 31, 2024. Grounds of complaints No. of complaints pending at the beginning of the year No. of complaints received during the year % increase/ (decrease) in the no. of complaints received over previous year No. of complaints pending at the end of the year Of 5, No. of complaints pending beyond 30 days 1 2 3 4 5 6 Credit Cards 2,618 129,690 84.7% 8,557 1,299 Internet/Mobile/ Electronic Banking 9,109 81,332 53.4% 10,607 4,693 ATM/Debit Cards 1,343 71,166 (6.4)% 1,025 104 Loans and advances 211 11,426 3.6% 308 23 Account opening/ difficulty in operation of accounts 184 9,879 28.2% 329 7 Others 964 42,821 41.2% 1,713 190 Total 14,429 346,314 39.5% 22,539 6,316 Annual Report 2023-24 | 247 Integrated Report Statutory Reports Financial Statements FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) The following table sets forth, top five grounds of complaints received by the Bank from customers for the year ended March 31, 2023. Grounds of complaints No. of complaints pending at the beginning of the year No. of complaints received during the year % increase/ (decrease) in the no. of complaints received over previous year No. of complaints pending at the end of the year Of 5, No. of complaints pending beyond 30 days 1 2 3 4 5 6 ATM/Debit Cards 3,655 76,049 (50.4%) 1,343 148 Credit Cards 3,312 70,225 (49.1%) 2,618 367 Internet/Mobile/ Electronic Banking 2,018 53,011 25.9% 9,109 3,546 Loans and advances 270 11,026 (30.3%) 211 3 Account opening/ difficulty in operation of accounts 144 7,708 (27.4%) 184 5 Others 1,002 30,318 (39.3%) 964 56 Total 10,401 248,337 (39.4%) 14,429 4,125 56. Drawdown from reserves The Bank has not drawn any amount from reserves during the year ended March 31, 2024 (year ended March 31, 2023: Nil). 57. Investor Education and Protection Fund The unclaimed dividend amount, due for transfer to the Investor Education and Protection Fund (IEPF) during the year ended March 31, 2024 and March 31, 2023, has been transferred without any delay. 58. Implementation of IFRS converged Indian Accounting Standards In January 2016, the Ministry of Corporate Affairs issued the roadmap for implementation of new Indian Accounting Standards (Ind AS), converged with International Financial Reporting Standards (IFRS), for scheduled commercial banks, insurance companies and non-banking financial companies (NBFCs). However, currently the implementation of Ind AS for banks has been deferred by RBI till further notice pending the consideration of some recommended legislative amendments by the Government of India. The Bank is in an advanced stage of preparedness for implementation of Ind AS, as and when these are made applicable to the Indian banks. Further, there may be new regulatory guidelines and clarifications in some critical areas of Ind AS application, which the Bank will need to suitably incorporate in its implementation. During FY2023, Reserve Bank of India, through its discussion paper on “Introduction of Expected Credit Loss framework for provisioning by banks” has proposed to adopt an expected credit loss framework based on the approach as per Indian Accounting Standard (Ind AS) 109, supplemented by regulatory backstops wherever necessary. Further, during FY2024, the Reserve Bank of India (RBI) issued a master direction on classification, valuation and operation of investment portfolio of commercial banks (Directions), 2023, which became effective from April 1, 2024. The revised master direction brings the classification and accounting of investments closer to Ind AS. The Bank has implemented the required changes as per the master direction with effect from April 1, 2024. 248 | Annual Report 2023-24 FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULES forming part of the Accounts (Contd.) 59. Disclosure on lending and borrowing activities The Bank, as part of its normal banking business, grants loans and advances, makes investment, provides guarantees to and accept deposits and borrowings from its customers, other entities and persons. These transactions are part of Bank’s normal banking business, which is conducted ensuring adherence to all regulatory requirements. Other than the transactions described above, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank to or in any other persons or entities, including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Bank (Ultimate Beneficiaries). The Bank has also not received any fund from any parties (Funding Party) with the understanding that the Bank shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security, or the like on behalf of the Ultimate Beneficiaries. 60. Comparative Figures Figures of the previous year have been re-grouped to conform to the current year presentation. Signatures to Schedules 1 to 18 As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 Annual Report 2023-24 | 249 Integrated Report Statutory Reports Financial Statements INDEPENDENT AUDITOR’S REPORT To the Members of ICICI Bank Limited Report on the Audit of the Consolidated Financial Statements Opinion 1. We have audited the accompanying consolidated financial statements of ICICI Bank Limited (hereinafter referred to as the ‘Bank’ or ‘Holding Company’) and its subsidiaries (Holding Company and its subsidiaries together referred to as ‘the Group’), and its associates, which comprise the Consolidated Balance Sheet as at 31 March 2024, the Consolidated Profit and Loss account, and the Consolidated Cash Flow Statement for the year then ended, and notes to the Consolidated Financial Statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as ‘the consolidated financial statements’). 2. In our opinion and to the best of our information and according to the explanations given to us, and based on consideration of the reports of the other auditors on separate financial statements and the other financial information of subsidiaries and associates, the aforesaid consolidated financial statements give the information required by the Banking Regulation Act, 1949 as well as the Companies Act, 2013 (‘the Act’), and circulars and guidelines issued by the Reserve Bank of India (‘RBI’) from time to time (‘RBI guidelines’) in the manner so required for banking companies and give a true and fair view in conformity with the Accounting Standards prescribed under Section 133 of the Act read with the Companies (Accounting Standards) Rules, 2021 and other and other accounting principles generally accepted in India, of the consolidated state of affairs of the Group and its associates as at 31 March 2024, and their consolidated profit, and their consolidated cash flows for the year then ended. Basis for Opinion 3. We conducted our audit in accordance with the Standards on Auditing (‘SAs’) specified under section 143(10) of the Act. Our responsibilities under those SAs are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group and its associates in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in India in terms of the Code of Ethics issued by Institute of Chartered Accountant of India (‘ICAI’), and the relevant provisions of the Act and the rules thereunder and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained along with the consideration of audit reports of other auditors referred to in the ‘Other Matters’ paragraph below is sufficient and appropriate to provide a basis for our opinion on the Consolidated Financial Statements. Key Audit Matters 4. Key audit matters are those matters that, in our professional judgment, and based on the consideration of the reports of the other auditors on separate financial statements and other financial information of the subsidiaries and associates, as referred to in paragraph 17 below, were of most significance in our audit of the consolidated financial statements of the current year. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. 250 | Annual Report 2023-24 5. We have determined the matters described below to be the key audit matters to be communicated in our report. Key Audit Matter How the matter was addressed in our audit Identification and provisioning of non-performing advances (NPA): Total Loans and Advances (Net of Provision) as at 31 March 2024: ` 12,607,762,029 (in ‘000s) Provision for NPA as at 31 March 2024: ` 222,697,569 (in ‘000s) of which Total Loans and Advances (Net of Provision) as at 31 March 2024: ` 11,844,063,894 (in ‘000s)* & Provision for NPA as at 31 March 2024: ` 219,358,846 (in ‘000s)* relates to Bank. (Refer Schedule 9, Schedule 17(14)) * the amounts relating to the Bank are before consolidation adjustments including intercompany eliminations, if any. The Reserve Bank of India’s (“RBI”) guidelines on Income recognition and asset classification & Provisioning (“IRAC”) and other circulars and directives issued by the RBI from time to time, which prescribe the prudential norms for identification and classification of performing & non-performing assets (“NPA”) and the minimum provision required for such assets. The Bank is required to have Board approved policy as per IRAC guidelines for NPA identification & classification of advances and provision thereon. The provision on NPA is estimated based on ageing and classification of NPAs, recovery estimates, nature of loan product, value of security and other qualitative factors and is subject to the minimum provisioning norms specified by RBI and approved policy of the Bank in this regard. The Bank is also required to apply its judgement to determine the identification and provision required against NPAs by applying quantitative as well as qualitative factors. The risk of identification of NPAs is affected by factors like stress and liquidity concerns in certain sectors. Additionally, the Bank makes provisions on exposures that are not classified as NPA including advances to certain sectors and identified advances or group advances. These are classified as contingency provisions. Since the identification of NPAs and provisioning for advances require significant level of estimation and given its significance to the overall audit including possible observation by RBI which could result into disclosure in the financial statements, we have ascertained identification and provisioning for NPAs as a key audit matter. Our audit procedures with respect to this matter included: Tested the design and operating effectiveness of key controls over approval, recording, monitoring and recovery of loans, monitoring overdue / stressed accounts, identification of NPA, provision for NPA and valuation of security and collateral on a test check basis. Further obtained an understanding of the contingency provision carried by the Bank and verified the underlying assumptions used by the Bank for such estimate. Tested application controls included test of automated controls, reports and system reconciliations. Reviewed existence and effectiveness of monitoring mechanisms such as Internal Audit, Systems Audit, and Concurrent Audit as per the policies and procedures of the Bank; Evaluated the governance process and review controls over calculations of provision of non-performing advances, basis of provisioning in accordance with the Board approved policy. Selected a sample of borrowers based on quantitative and qualitative risk factors for their assessment of appropriate identification & classification as NPA including computation of overdue ageing to assess its correct classification and provision amount as per extant IRAC norms and the Bank policy. Performed other substantive procedures included and not limited to the following:  Selected samples of performing loans and assessed independently as to whether those should be classified as NPA;  For samples selected, reviewed the collateral valuations, financial statements and other qualitative information INDEPENDENT AUDITOR’S REPORT (Contd.) Annual Report 2023-24 | 251 Integrated Report Statutory Reports Financial Statements Key Audit Matter How the matter was addressed in our audit  Considered the accounts reported by the Bank and other Banks as Special Mention Accounts (“SMA”) in RBI’s Central Repository of Information on Large Credits (CRILC)/ Centralised Information Management System (CIMS) to identify stress.  For selected samples, assessed independently, the accounts that can potentially be classified as NPA.  Inquired with the credit and risk departments to ascertain if there were indicators of stress or an occurrence of an event of default in a particular loan account or any product category which needed to be considered as NPA.  Examined the accounts under watchlist report provided by the risk department.  Discussed with the management of the Bank on sectors where there is a perceived credit risk and the steps taken to mitigate the risks to identified sectors.  Selected and tested samples for accounts which are restructured as per RBI Master Circular - Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances; and  Assessed appropriateness & the adequacy of disclosures against the relevant accounting standards and RBI requirements relating to NPAs. Evaluation of Litigations included in Contingent Liabilities As at 31 March 2024, the Group has reported ‘Claims against the Group not acknowledged as debts’ of ` 110,275,158 (in ‘000s) (31 March 2023 – ` 88,006,837 (in ‘000s)), of which the following relate to the Bank: (Included under contingent liabilities) (in ‘000) Particulars As at 31 March 2024 As at 31 March 2023 Legal Cases 3,829,177 3,027,295 Taxes 89,463,903 78,935,723 Total Claims against Bank not acknowledged as Debt 93,293,080 81,963,018 (Refer Schedule 12 and Schedule 17(11)) The Bank has material open tax litigations including matters under dispute which involve significant judgement to determine the possible outcome of these disputes. Significant management judgement is needed in determining whether an obligation exists and whether Our Audit procedures with respect to this matter included: Tested the design and operating effectiveness of the Bank’s key controls over the estimation, monitoring and disclosure of provisions and contingent liabilities on test check basis. INDEPENDENT AUDITOR’S REPORT (Contd.) 252 | Annual Report 2023-24 Key Audit Matter How the matter was addressed in our audit a provision should be recognised as at the reporting date, in accordance with the accounting criteria set under Accounting Standard 29 - Provisions, Contingent Liabilities and Contingent Assets (‘AS 29’), or whether it needs to be disclosed as a contingent liability. Further, significant judgements are also involved in measuring such obligations, the most significant of which are:  Assessment of Liability: Judgement is involved in determination of whether outflow in respect of identified material matters are probable and can be estimated reliably.  Adequacy of provisions: The appropriateness of assumption and judgements used in estimation of significant provisions; and  Adequacy of disclosures of provision for liabilities and charges, and contingent liabilities. The Bank’s assessment is supported by the facts of matter, their own judgement, experience, and advises from legal and independent tax consultants wherever considered necessary. Since the assessment of these open litigations requires significant level of judgement in interpretation of law, we have included this as a key audit matter. Our substantive audit procedures included and were not limited to the following:  Obtained an understanding of Bank’s process for determining tax liabilities, tax provisions and contingent liabilities pertaining to legal and taxation matters;  Obtained a list of cases /matters in respect of which the litigations were outstanding as at reporting date:  For significant legal matters, we obtained external confirmations and corroborated with management’s documented conclusions on the assessment of outstanding litigations against the Bank;  For significant taxation matters, we involved our tax specialists to gain an understanding of status of the litigations including understanding of various orders/ notices received by the Bank and management’s grounds of appeals before the relevant appellate authorities.  Evaluated the merit of the subject matter under consideration with reference to the grounds presented therein and available independent legal / tax advice;  Inquired with appropriate level of the management including status update, expectation of outcomes with the basis, and the future course of action contemplated by the Bank;  Reviewed minutes of meetings with Board, and Audit committee in this regard  Agreed underlying tax balances to supporting documentation including correspondence with the Tax authorities; and  Assessed the appropriateness & adequacy of disclosures within the standalone financial statements in accordance with the applicable accounting standards and requirements of RBI in this regard. INDEPENDENT AUDITOR’S REPORT (Contd.) Annual Report 2023-24 | 253 Integrated Report Statutory Reports Financial Statements Key Audit Matter How the matter was addressed in our audit Information Technology (‘IT’) systems and controls impacting financial controls The Bank has a complex IT architecture to support its day-to-day business operations. High volume of transactions is processed and recorded on single or multiple applications. The reliability and security of IT systems plays a key role in the business operations of the Bank. Since large volume of transactions are processed daily, the IT controls are required to ensure that applications process data as expected and that changes are made in an appropriate manner. Appropriate IT general controls and application controls are required to ensure that such IT systems are able to process the data, as required, completely, accurately and consistently for reliable financial reporting. We have identified ‘IT systems and controls’ as key audit matter because of the high level automation, significant number of systems being used by the management and the complexity of the IT architecture and its impact on the financial reporting system. Our Audit procedures with respect to this matter included: For testing the IT general controls, application controls and IT dependent manual controls, we involved IT specialists as part of the audit. The team also assisted in testing the accuracy of the information produced by the Bank’s IT systems. Obtained a comprehensive understanding of IT applications landscape implemented at the Bank. It was followed by process understanding, mapping of applications to the same and understanding financial risks posed by people-process and technology. Key IT audit procedures includes testing design and operating effectiveness of key controls operating over user access management (which includes user access provisioning, de-provisioning, access review, password configuration review, segregation of duties and privilege access), change management (which include change release in production environment are compliant to the defined procedures and segregation of environment is ensured), program development (which include review of data migration activity), computer operations (which includes testing of key controls pertaining to, backup, Batch processing (including interface testing), incident management and data centre security), System interface controls. This included testing that requests for access to systems were appropriately logged, reviewed, and authorized. In addition to the above, the design and operating effectiveness of certain automated controls, that were considered as key internal system controls over financial reporting were tested. Using various techniques such as inquiry, review of documentation / record / reports, observation, and re-performance. We also tested few controls using negative testing technique. Tested compensating controls and performed alternate procedures, where necessary. In addition, understood where relevant changes made to the IT landscape during the audit period. INDEPENDENT AUDITOR’S REPORT (Contd.) 254 | Annual Report 2023-24 INDEPENDENT AUDITOR’S REPORT (Contd.) The joint auditors of ICICI Prudential Life Insurance Company Limited, vide their audit report dated 23 April 2024, have expressed an unmodified opinion on the financial statements. Based on consideration of their report, the following Key Audit Matter was included in the audit report. Key Audit Matter How the matter was addressed in our audit Information Technology (IT) systems relating to financial reporting process relating to ICICI Prudential Life Insurance Company Limited The Company is highly dependent on its complex IT infrastructure comprising hardware, software, multiple applications, automated interfaces and controls in systems for recording, storing and reporting of financial transactions. The Company's key financial accounting and reporting processes such as premium income, commission, benefits paid, investments amongst others are highly dependent on IT systems including automated controls, to process and record large volume of transactions on daily basis as part of its operations, such that there exists a risk that gaps in the IT control environment could result in the financial accounting and reporting records being materially misstated. Due to the pervasive nature, complexity and importance of the impact of the IT systems and related control environment on the Company's financial statements, we have identified testing of such IT systems and related control environment as a key audit matter for the current year audit. Involvement of IT specialists in assessment of the IT systems and controls with respect to financial statements, which included, but were not limited to the following:  Obtained an understanding of the Company's General IT Control (GITC) over key financial accounting and reporting systems, and supporting control systems (referred to as in-scope systems);  On the in-scope systems, tested the design and operating effectiveness of key IT general controls. This included evaluation of entity's controls to ensure segregation of duties and access rights are based on duly approved requests, access for exit cases being revoked in a timely manner and access of all users being re- certified during the period of audit, evaluation of password policies. Further, controls related to program change were evaluated to verify whether the changes were approved, tested in an environment that was segregated from production and moved to production by appropriate users;  Evaluated the design and tested the operating effectiveness for the audit period over the in-scope systems around system interfaces, reconciliations and system processing relevant to the audit of premium income, commission expense, benefits paid and investments, for evaluating completeness and accuracy;  Evaluated policies and strategies adopted by the Company in relation to security of key information infrastructure, data and client information management and monitoring;  Where deficiencies, if any, were identified, tested compensating controls or performed alternative procedures; and  Obtained written representations from management on whether IT general controls and automated IT controls are designed and were operating effectively during the year. Annual Report 2023-24 | 255 Integrated Report Statutory Reports Financial Statements INDEPENDENT AUDITOR’S REPORT (Contd.) Key Audit Matter How the matter was addressed in our audit Valuation and Impairment determination of Investments relating to ICICI Prudential Life Insurance Company Limited 31 March 2024 : ` 2,897,360,953 (in ‘000s) (31 March 2023 : ` 2,482,204,207 (in ‘000s))* (Refer Schedule 8, Schedule 17(13)) * the amounts relating to ICICI Prudential Life Insurance Company Limited are before consolidation adjustments including intercompany eliminations, if any. The Company's investment portfolio consists of Policyholders investments (unit linked and non- linked) and Shareholders investments. Total investment portfolio represents around 99% of the Company's total assets as at 31 March 2024. Investments are valued in accordance with the Board approved investment policy framed by the Company as per the provisions of the Insurance Act, the IRDA Financial Statements Regulations, IRDAI (Investment) Regulations, 2016 as the applicable orders/ directions/ circulars issued by IRDAI. Investments in unit linked portfolio of ` 1,648,424,014 (in ‘000) are valued based on observable inputs as per their accounting policy and gains/losses are recognized in Revenue account. These unit linked portfolio investments do not represent higher risk of material misstatement however, are considered to be a key audit matter due to their materiality to the standalone financial statements. Investments in non-linked and shareholders portfolio of ` 1,248,936,939 (in ‘000) are valued as per their accounting policy, based on which:  the unrealized gains/ losses arising due to changes in fair value of listed equity shares and mutual fund units are recorded in the "Fair Value Change Account" in the Balance Sheet; and  debt securities and unlisted equity shares are valued at historical cost. Further, investments in the non-linked and shareholders portfolio are assessed for impairment as per the Company's investment policy which involves significant management judgement. There is increased economic stress on account of external factors, which may impact the valuation of these investments. Accordingly, valuation of investments (including impairment assessment) was considered to be one of the areas which required significant auditor attention and was one of the matter of most significance in the standalone financial statements. Audit procedures for this area included but were not limited to the following:  Obtained an understanding of the Company's process and controls over the valuation of investments. The understanding was obtained by performance of walkthroughs, which included inspection of documents produced by the Company and discussion with those involved in the pertinent process;  Evaluated and tested the design, implementation and operating effectiveness of key controls over the valuation process, including the Company's assessment and approval of assumptions used for the valuation including key authorisation and data input controls thereof;  Obtained independent external confirmations for investments as at balance sheet date from the Custodians and Depository Participants appointed by the Company to confirm the units of securities for the purpose of valuation re-computation;  On a test check basis, recomputed valuation of different class of investments to assess appropriateness of valuation methodologies with reference to IRDAI Investment Regulations along with the Company's Board approved valuation policy;  Examined movement and appropriateness of accounting in Fair Value Change account for specific investments. Further, in case of revaluation done for investment properties, examined the underlying valuation report for valuation for testing the reasonableness and also recomputed the movement in "Revaluation reserve".  Ensured the appropriateness and reasonableness of methodology, assumptions and judgements used by management with reference to the valuation and impairment of investments as per the Company's Board approved valuation and impairment policy. Obtained third party valuation price reports as per the Company's policy as relevant and understood such methodology to conclude on the reasonableness.  Obtained written representations from management on compliance of valuation of investments with the regulations and adequacy of impairment recorded for the year. 256 | Annual Report 2023-24 INDEPENDENT AUDITOR’S REPORT (Contd.) The joint auditors of ICICI Lombard General Insurance Company Limited, vide their audit report dated 17 April 2024, have expressed an unmodified opinion on the financial statements. Based on consideration of their report, the following Key Audit Matter was included in the audit report. Key Audit Matter How the matter was addressed in our audit Information Technology Systems and Controls (IT Controls) related to financial reporting relating to ICICI Lombard General Insurance Company Limited The Company is highly dependent on its complex IT architecture comprising hardware, software, multiple applications, automated interfaces and controls in systems for recording, storing and reporting financial transactions. A number of independent and inter- dependent IT systems are used by the Company for processing and recording the large volume of transactions on daily basis as part of its operations, which impacts key financial accounting and reporting items such as premium income, claims, commission expenses and investments amongst others. There exists a risk that, gaps in the IT control environment could result in the financial accounting and reporting records being materially misstated. The controls implemented by the Company in its IT environment determine the integrity, accuracy, completeness, and the validity of the data that is processed by the applications and is ultimately used for financial reporting. These controls contribute to mitigating risk of potential misstatements caused by fraud or errors. Our audit approach relies on automated controls and therefore, procedures are designed to test. Controls over IT systems, segregation of duties, interface and system application controls over key financial accounting and reporting systems. Due to, complexity and pervasive impact of the IT system and related control environment on the Company’s financial statements, identified testing of such IT systems and related control environment as a key audit matter for the current year audit. Key audit procedures included but were not limited to the following: Involvement of IT specialists to perform procedures which included, but were not limited to the following:  Obtained an understanding of the Company’s IT related control environment, IT applications and databases. Furthermore, conducted a risk assessment and identified IT applications, databases that are relevant for the Company’s financial reporting.  For the IT systems relevant to reporting of financial information, tested design and operative effectiveness of key IT general controls over the key IT systems that are critical to financial reporting. This included evaluation of entity’s controls to ensure segregation of duties and access rights being provisioned/modified based on duly approved requests, access for exit cases being revoked in a timely manner and access of all users being re- certified during the period of audit. Further, controls related to program change were evaluated to verify whether the changes were approved, tested in an environment that was segregated from production and moved to production by appropriate users. Where deficiencies were identified, tested compensating controls and/or performed additional substantive audit procedures as required to mitigate any risk of material misstatement with respect to related financial statement line item.  Evaluated the design and tested the operating effectiveness of critical and key automated controls within various business processes around the software systems. This included testing the integrity of system interfaces, report logic for system generated reports relevant to the audit of premium Income, commission expense, claims and Investments, for evaluating completeness and accuracy. Annual Report 2023-24 | 257 Integrated Report Statutory Reports Financial Statements Key Audit Matter How the matter was addressed in our audit  Reviewed the Information System Audit Reports and Key audit findings of Internal Audit to assess the impact of observations and management’s response if any on financial reporting.  Obtained written representations from management on whether IT general controls and automated IT controls are designed and were operating effectively during the year. Investments of ICICI Lombard General Insurance Company Limited The Company's investment portfolio consists of Policyholders investments and Shareholders investments. Total Investment portfolio represents 77% of the assets as at 31 March 2024 which are valued in accordance with accounting policy framed as per the extant regulatory guidelines. The valuation of all investments is as per the investment policy framed by the Company as per the requirements contained in with IRDAI (Investment) Regulations, 2016, and the IRDA Preparation of Financial Statement Regulations. The valuation methodology specified in these aforesaid regulations is applied by the Company for each class of investment which includes various measurement techniques such as amortised cost, fair value etc. The Company has a policy framework for Valuation and impairment of Investments. The Company performs an impairment review of its investments at each balance sheet date and recognizes impairment charge when the investments meet the trigger/s for impairment provision as per the criteria set out in the investment policy of the Company. Such assessment of impairment involves significant management judgment. The valuation of these investments was considered one of the matters of material significance in the financial statements due to the materiality of the total value of investments to the financial statements and thereby identified as a key audit matter for current year audit. Audit procedures on Investments included the following:  Understood Company's process and controls to ensure proper investments valuation and impairment process.  Tested the design, implementation, management oversight and operating effectiveness of key controls over the valuation process of investments including impairment.  Obtained independent external confirmations for investments as at balance sheet date from the Custodians and Depository Participants appointed by the Company to confirm the units of securities for the purpose of valuation re-computation.  On a test check basis, recomputed valuation of different class of Investments to assess appropriateness of the valuation methodologies with reference to IRDAI Investment Regulations along with Company's own investment policy.  Examined movement and appropriateness of accounting in Fair Value Change account for specific investments.  Reviewed the Company's impairment policy and assessed the adequacy of its impairment charge on investments outstanding at the year end.  Examined the rating downgrades by credit rating agencies and assessed the adequacy of impairments to various investments.  Evaluated appropriateness and reasonableness of methodology, assumptions and judgements used by management with reference to the Company's investment valuation and impairment assessment as per policy.  Obtained written representations from management on compliance of valuation of investments with the regulations and adequacy of impairment recorded for the year. INDEPENDENT AUDITOR’S REPORT (Contd.) 258 | Annual Report 2023-24 Information Other than the Consolidated Financial Statements and Auditor’s Report Thereon 6. The Holding Company’s Board of Directors are responsible for the other information. The other information comprises the information included in the Annual Report but does not include the consolidated financial statements and our auditor’s report thereon. The Annual Report is expected to be made available to us after that date of this auditor’s report. Our opinion on the Consolidated Financial Statements does not cover the other information and we will not express any form of assurance conclusion thereon. In connection with our audit of the Consolidated Financial Statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the Consolidated Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. When we read the Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and take appropriate action as applicable under the relevant laws and regulations. Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements 7. The Holding Company’s Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation and presentation of these consolidated financial statements that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group including its associates in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act read with the Companies (Accounting Standard) Rules, 2021, provisions of Section 29 of the Banking Regulation Act, 1949 and circulars and guidelines issued by the Reserve Bank of India (‘RBI’) from time to time (‘RBI guidelines’). The respective Board of Directors of the Holding Company and the subsidiary companies included in the Group and of its associate companies are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act and the RBI guidelines for safeguarding of the assets of the Group and of its associates and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring accuracy and completeness of the accounting records, relevant to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the Management and Directors of the Bank, as aforesaid. 8. In preparing the consolidated financial statements, the respective Board of Directors of the companies included in the Group and of its associates are responsible for assessing the ability of the respective companies included in the Group and of its associates to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the respective Board of Directors either intends to liquidate the companies included in the Group and its associates or to cease operations, or has no realistic alternative but to do so. 9. The respective Board of Directors of the companies included in the Group and of its associates are also responsible for overseeing the financial reporting process of the subsidiary companies included in the Group and of its associates. INDEPENDENT AUDITOR’S REPORT (Contd.) Annual Report 2023-24 | 259 Integrated Report Statutory Reports Financial Statements INDEPENDENT AUDITOR’S REPORT (Contd.) Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements 10. Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. 11. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control; • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Bank has adequate internal financial controls with reference to consolidated financial statements in place and the operating effectiveness of such controls; • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Management; • Conclude on the appropriateness of Management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Group and its associates to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group and its associates to cease to continue as a going concern; • Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation; • Obtain sufficient appropriate audit evidence regarding the financial information of the entities within the Group and its associates to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the audit of the financial statements of such entities included in the consolidated financial statements of which we are the independent auditors. For the other entities included in the consolidated financial statements, which have been audited by other auditors, such other auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion. 12. We communicate with those charged with governance of the Bank and such other entities included in the consolidated financial statements of which we are the independent auditors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. 260 | Annual Report 2023-24 INDEPENDENT AUDITOR’S REPORT (Contd.) 13. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. 14. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Other Matters 15. The joint statutory auditors of ICICI Prudential Life Insurance Company Limited (‘ICICI Life’), vide their audit report dated 23 April 2024 have expressed an unmodified opinion and have reported in the ‘Other Matter’ section that ‘The actuarial valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at 31 March 2024 is the responsibility of the Company’s Appointed Actuary (the “Appointed Actuary”). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at 31 March 2024 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Authority. Accordingly, the joint auditors have relied upon the Appointed Actuary’s certificate in this regard for forming their opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists in the standalone financial statements of the Company’. Our opinion is not modified in respect of this matter based on the opinion expressed by the joint statutory auditors of ICICI Life. 16. The joint statutory auditors of ICICI Lombard General Insurance Company Limited (‘ICICI General’), vide their audit report dated 17 April 2024, have expressed an unmodified opinion and have reported in the ‘Other Matter’ section that, ‘The actuarial valuation of liabilities in respect of Incurred But Not Reported (‘IBNR’), Incurred But Not Enough Reported (‘IBNER’) and the Premium Deficiency Reserve (‘PDR’) is the responsibility of the Company’s Appointed Actuary (the ‘Appointed Actuary’). The actuarial valuation of these liabilities, that are estimated using statistical methods as at 31 March 2024 has been duly certified by the Appointed Actuary and in his opinion, the assumptions considered by him for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with IRDAI. The joint auditors have relied upon the Appointed Actuary’s certificate in this regard for forming their opinion on the valuation of liabilities for outstanding claims reserves and the PDR contained exists in the financial statements of the Company’. Our opinion is not modified in respect of this matter based on the opinion expressed by the joint statutory auditors of ICICI General. 17. We did not audit the financial Statement of sixteen subsidiaries (including ICICI Lombard General Insurance Company Limited from 29 February 2024 and I-Process Services (India) Private Limited from 20 March 2024), whose financial statements reflect total assets of ` 4,689,114,347 (in ‘000s) (before consolidation adjustments) as at 31 March 2024, total revenue of ` 713,613,428 (in ‘000s) (before consolidation adjustments), total net profit after tax of ` 57,346,248 (in ‘000s) (before consolidation adjustments) and total cash inflows (net) of ` 51,998,091 (in ‘000s) for the year ended 31 March 2024, which have been audited by their respective independent auditors. The consolidated financial statement includes the Group's share of net profit of ` 10,493,322 (in ‘000s) (before consolidation adjustments) for year ended 31 March 2024 in respect of five associates (including ICICI Lombard General Insurance Company Limited till 28 February 2024 and I-Process Services (India) Private Limited till 19 March 2024) whose financial statements have not been audited by us. These financial statements have been audited by other auditors whose reports have been furnished to us by the management and our opinion on the Consolidated Financial Statements, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries and associates, and our report Annual Report 2023-24 | 261 Integrated Report Statutory Reports Financial Statements in terms of section 143(3) of the Act, in so far as it relates to the aforesaid subsidiaries and associates, is based solely on the reports of the other auditors. Further, of these subsidiaries, two subsidiaries are located outside India whose financial statements have been prepared in accordance with accounting principles generally accepted in their respective country and which have been audited by their respective auditors under generally accepted auditing standards applicable in their respective countries. Our audit report in so far as it relates to the balances and affairs of such subsidiaries located outside India, is based on the report of other auditors. According to the information and explanations given to us by the management, the financial statements of these subsidiaries are not material to the Group. Our opinion is not modified in respect of these matters. 18. Further, one subsidiary company whose financial statement reflects total assets of ` 167,418 (in ‘000s) (before consolidation adjustments) as at 31 March 2024 and total revenues of ` 8,842 (in ‘000s) (before consolidation adjustments) and total net profit after tax of ` 7,601 (in ‘000s) (before consolidation adjustments) for the year ended 31 March 2024 respectively and the total cash inflows (net) of ` 33 (in ‘000s) for the year ended 31 March 2024, as considered in the Statement has been audited by M S K A & Associates, one of the joint auditors of the Bank. Accordingly, the conclusion of KKC & Associates LLP (formerly Khimji Kunverji & Co LLP), the other joint auditor of the Bank, in so far as it relates to the amounts and disclosures included in respect of this subsidiary, is based solely on the audit report issued by the joint auditors of the subsidiary company and the procedures performed as stated in paragraph 11 above. Our opinion is not modified in respect of these matters. 19. We did not audit the financial Statement of one subsidiary, whose financial statements reflect total assets of `  361,001,808 (in ‘000s) (before consolidation adjustments), total revenue of ` 19,330,122 (in ‘000s) (before consolidation adjustments), total net profit after tax of ` 4,500,705 (in ‘000s) (before consolidation adjustments) and total cash inflows (net) of ` (2,439,495) (in ‘000s) for the year ended 31 March 2024. Further, this subsidiary is located outside India whose financial statements have been prepared in accordance with accounting principles generally accepted in their respective country. The Statement also includes the Group's share of net profit of ` 244,338 (in ‘000s) (before consolidation adjustments) for the year ended 31 March 2024 respectively in respect of three associates whose financial statements have not been audited. These financial statements / financial information are unaudited and have been furnished to us by the management and our opinion on the Consolidated Financial Statements, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries and associates and our report in terms of section 143(3) of the Act in so far as it relates to the aforesaid subsidiaries and associates, is based solely on such unaudited financial statements / financial information. In our opinion and according to the information and explanations given to us by the Management, this financial statements / financial information are not material to the Group. Our opinion is not modified in respect of these matters. 20. Our opinion on the Consolidated Financial Statements, and our report on Other Legal and Regulatory Requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors and the financial statements / financial information certified by the management. Report on Other Legal and Regulatory Requirements 21. The Consolidated Balance Sheet and the Consolidated Profit and Loss Account have been drawn up in accordance with the provisions of section 29 of the Banking Regulation Act, 1949 and section 133 of the Act and the relevant rules issued thereunder. 22. In our opinion and according to the information and explanation given to us and based on reports of the statutory auditors of such subsidiary companies and associates companies incorporated in India which were not audited by us, the remuneration paid during the current year by the subsidiaries and associate companies incorporated in India to its directors is in accordance with the provisions of and the limits laid down under section 197 read with Schedule V of the Act. Further, for three associates, as referred to in paragraph 19 above, whose financial statements/information have not been audited, in absence of reporting of such entities with respect to compliance of INDEPENDENT AUDITOR’S REPORT (Contd.) 262 | Annual Report 2023-24 the provisions of section 197 read with Schedule V of the Act during the year ended 31 March 2024, we are unable to comment on such compliance for the said entities as required to be reported by us under section 197(16) of the Act. Further, since the Holding Company is a banking company, as defined under Banking Regulation Act, 1949, the reporting under section 197(16) in relation to whether the remuneration paid by the Bank is in accordance with the provisions of section 197 of the Act and whether any excess remuneration has been paid in accordance with the aforesaid section, is not applicable. 23. As required by Section 143(3) of the Act, based on our audit and on the consideration of report of the other auditor on separate financial statements and the other financial information of the subsidiaries and associates we report, to the extent applicable, that: a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid consolidated financial statements. b. In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated financial statements have been kept so far as it appears from our examination of those books and the reports of the other auditors except the matters stated in the paragraph 23(h)(vi) below relating to the general insurance subsidiary on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014. c. The Consolidated Balance Sheet, the Consolidated Profit and Loss Account, and the Consolidated Cash Flow Statement dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated financial statements. d. In our opinion, the aforesaid consolidated financial statements comply with the Accounting Standards specified under Section 133 of the Act read with relevant rules issued thereunder, to the extent they are not inconsistent with the guidelines prescribed by RBI. e. The observation relating to the maintenance of accounts and other matters connected therewith relating to the general insurance subsidiary as stated in the paragraph 23(b) above on reporting under Section 143(3)(b) of the Act and paragraph 23(h)(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014. f. On the basis of the written representations received from the directors of the Bank as on 31 March 2024 taken on record by the Board of Directors of the Bank and the reports of the statutory auditors of its subsidiary companies and associate companies incorporated in India, none of the directors of the Group companies and its associate companies incorporated in India are disqualified as on 31 March 2024 from being appointed as a director in terms of Section 164 (2) of the Act. g. With respect to the adequacy of internal financial controls with reference to consolidated financial statements of the Group and its associates and the operating effectiveness of such controls, refer to our separate report in “Annexure A”. h. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditor’s) Rules, 2014 as amended, in our opinion and to the best of our information and according to the explanations given to us based on our audit and on the consideration of report of the other auditor on separate financial statements of such subsidiaries and associates as noted in the ‘Other Matters’ paragraph: i. The consolidated financial statements disclose the impact of pending litigations as at 31 March 2024 on the consolidated financial position of the Group and its associates. (Refer Schedule 12, Schedule 17(11) and Schedule 18(6) to the consolidated financial statements) INDEPENDENT AUDITOR’S REPORT (Contd.) Annual Report 2023-24 | 263 Integrated Report Statutory Reports Financial Statements ii. Provision has been made in the consolidated financial statements as at 31 March 2024, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts – (Refer Schedule 17(11) and Schedule 18(6) to the consolidated financial statements), in respect of such items as it relates to the Group and its associates and the Group’s share of net profit in respect of its associates. iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Bank and its subsidiary companies, associate companies incorporated in India. iv. (1) The respective Managements of the Bank, subsidiaries and its associates which are companies incorporated in India whose financial statements have been audited under the Act have represented to us, and the other auditors of such subsidiaries and associates respectively that, to the best of their knowledge and belief, as disclosed in schedule 18(16) to the consolidated financial statements, no funds (which are material either individually or in the aggregate) have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank or any of such subsidiaries and associates to or in any other person(s) or entity(ies), including foreign entities (‘Intermediaries’), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Bank or any of such subsidiaries and associates (‘Ultimate Beneficiaries’) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; (2) The respective Managements of the Bank, its subsidiaries and associate which are companies incorporated in India whose financial statements have been audited under the Act have represented to us and the other auditors of such subsidiaries and associates respectively that, as disclosed in schedule 18(16) to the consolidated financial statements, to the best of their knowledge and belief, no funds (which are material either individually or in the aggregate) have been received by the Company or any of such subsidiaries and associates from any person(s) or entity(ies), including foreign entities (‘Funding Parties’), with the understanding, whether recorded in writing or otherwise, that the Bank or any of such subsidiaries and associates shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (‘Ultimate Beneficiaries’) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. (3) Based on the audit procedures, that which we have has been considered reasonable and appropriate in the circumstances, performed by us and those performed by the auditors of the subsidiaries and associates which are companies incorporated in India whose financial statements have been audited under the Act, nothing has come to our or other auditor’s notice that has caused us or the other auditors to believe that the representations under sub-clause (1) and (2) of Rule 11 (e) contain any material misstatement. v. In our opinion and according to the information and explanations given to us, the dividend declared and / or paid during the year the Group and its associates is in compliance with Section 123 of the Act. vi. Based on our examination, which included test checks, and that performed by the respective auditors of the subsidiaries and associates which are companies incorporated in India whose financial statements have been audited under the Act, except for the instances mentioned below, the Bank, subsidiaries and associates have used an accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit, we and respective auditors of the above referred subsidiaries and associates did not come across any instance of audit trail feature being tampered with. INDEPENDENT AUDITOR’S REPORT (Contd.) 264 | Annual Report 2023-24 In respect of the general insurance subsidiary, the auditors have reported that they were not able to test the audit trail feature for one accounting software used for maintaining policy and claim records related to the insurance business demerged from Bharti Axa General Insurance Company Limited, since its usage was discontinued w.e.f. 31 October 2023 and another accounting software which is used for maintenance of commission and reinsurance records at the database level where the audit trail feature was enabled w.e.f. 15 March 2024. For M S K A & Associates Chartered Accountants ICAI Firm Registration No. 105047W For KKC & Associates LLP Chartered Accountants (Formerly Khimji Kunverji & Co LLP) ICAI Firm Registration No.105146W/W100621 Tushar Kurani Partner Membership Number.: 118580 UDIN: 24118580BKFLYB7746 Vinit Jain Partner Membership Number.: 145911 UDIN: 24145911BKFXMQ1407 Place: Mumbai Date: 27 April 2024 Place: Mumbai Date: 27 April 2024 INDEPENDENT AUDITOR’S REPORT (Contd.) Annual Report 2023-24 | 265 Integrated Report Statutory Reports Financial Statements Annexure A to the Independent Auditors’ Report on the Consolidated Financial Statements Of ICICI Bank Limited for the year ended 31 March 2024 (Referred to in paragraph “23g” under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date) Report on the Internal Financial Controls with reference to the aforesaid Consolidated Financial Statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”) Opinion 1. In conjunction with our audit of the consolidated financial statements of the Bank as of and for the year ended 31 March 2024, we have audited the internal financial controls with reference to consolidated financial statements of ICICI Bank Limited (“the Holding Company”) and its subsidiary companies and its associate companies, which are companies incorporated in India, as of that date. 2. In our opinion, and based on the consideration of the reports of the other auditors on internal financial controls with reference to the consolidated financial statements, to the best of our information and according to the explanations given to us, the Holding Company, its subsidiary companies and its associate companies, which are companies incorporated in India, have, in all material respects, an adequate internal financial controls with reference to consolidated financial statements and such internal financial controls with reference to consolidated financial statements were operating effectively as at 31 March 2024, based on the internal control with reference to consolidated financial statements criteria established by the respective companies considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (“the ICAI”). Responsibilities of Management and Those Charged with Governance for Internal Financial Controls 3. The respective Board of Directors of the Holding Company, its subsidiary companies and its associate companies, to whom reporting under clause (i) of sub-section 143 of the Act in respect of adequacy of the internal control with reference to financial statements is applicable, which are companies incorporated in India, are responsible for establishing and maintaining internal financial controls based on the internal control with reference to consolidated financial statements criteria established by the respective companies considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (‘the Guidance Note’) issued by the ICAI. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective Bank’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act. Auditor’s Responsibility for the Audit of the Internal Financial Controls with Reference to Consolidated Financial Statements 4. Our responsibility is to express an opinion on the internal financial controls with reference to consolidated financial statements of the Holding Company, its subsidiary companies and its associate companies, which are companies incorporated in India, based on our audit. We conducted our audit in accordance with the Guidance Note issued by the ICAI and the Standards on Auditing prescribed under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to consolidated financial statements were established and maintained and if such controls operated effectively in all material respects. 5. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to consolidated financial statements and their operating effectiveness. Our audit of internal financial controls with reference to consolidated financial statements included obtaining an understanding of such internal financial controls with reference to consolidated financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. 266 | Annual Report 2023-24 6. We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors in terms of their reports referred to in the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the internal financial controls with reference to consolidated financial statements of the Holding Company, its subsidiary companies and its associate companies, which are companies incorporated in India. Meaning of Internal Financial Controls with Reference to the Consolidated Financial Statements 7. A Bank's internal financial control with reference to the consolidated financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles. A Bank's internal financial control with reference to consolidated financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Bank; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Bank are being made only in accordance with authorizations of management and directors of the Bank; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Bank's assets that could have a material effect on the consolidated financial statements. Inherent Limitations of Internal Financial Controls with Reference to the Consolidated Financial Statements 8. Because of the inherent limitations of internal financial controls with reference to consolidated financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to consolidated financial statements to future periods are subject to the risk that the internal financial controls with reference to consolidated financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Other Matters 9. The auditors of ICICI Prudential Life Insurance Company Limited have reported, ‘The actuarial valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at 31 March 2024 has been certified by the Appointed Actuary as per the IRDA Financial Statements Regulations, and has been relied upon by us, as mentioned in “Other Matters” of our audit report on the standalone financial statements for the year ended 31 March 2024. Accordingly, our opinion on the internal financial controls with reference to standalone financial statements does not include reporting on the design and operating effectiveness of the management’s internal controls over the valuation and accuracy of the aforesaid actuarial valuation’. 10. The auditors of ICICI Lombard General Insurance Company Limited have reported, ‘The actuarial valuation of liabilities in respect of Incurred But Not Reported (the "IBNR"), Incurred But Not Enough Reported (the "IBNER") and Premium Deficiency Reserve (the "PDR") is the responsibility of the Company's Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities, that are estimated using statistical methods as at 31 March 2024 has been duly certified by the Appointed Actuary and in his opinion, the assumptions considered by him for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the IRDAI. The said actuarial valuations of liabilities for outstanding claims reserves and the PDR have been relied upon by us as mentioned in Other Matters paragraph in our Audit Report on the financial statements for the year ended 31 March 2024. Accordingly, our opinion on the internal financial controls with reference to financial statements does not include reporting on the adequacy and operating effectiveness of the internal controls over the valuation and accuracy of the aforesaid actuarial liabilities’. Annexure A (Contd.) Annual Report 2023-24 | 267 Integrated Report Statutory Reports Financial Statements Annexure A (Contd.) 11. Our aforesaid report under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls system with reference to the Consolidated Financial Statements in so far as it relates to twelve subsidiary companies and one associate company, which are companies incorporated in India, is based on the corresponding reports of the auditors of such subsidiaries and associates incorporated in India. Our opinion is not modified in respect of the matters with respect to our reliance on the work done by and on the reports of the other auditors. For M S K A & Associates Chartered Accountants ICAI Firm Registration No. 105047W For KKC & Associates LLP Chartered Accountants (Formerly Khimji Kunverji & Co LLP) ICAI Firm Registration No.105146W/W100621 Tushar Kurani Partner Membership Number.: 118580 UDIN: 24118580BKFLYB7746 Vinit Jain Partner Membership Number.: 145911 UDIN: 24145911BKFXMQ1407 Place: Mumbai Date: 27 April 2024 Place: Mumbai Date: 27 April 2024 268 | Annual Report 2023-24 CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED CONSOLIDATED BALANCE SHEET at March 31, 2024 ` in ‘000s Schedule At 31.03.2024 At 31.03.2023 CAPITAL AND LIABILITIES Capital 1 14,046,790 13,967,750 Employees stock options outstanding 1A 14,053,180 7,608,859 Reserves and surplus 2 2,533,338,376 2,123,401,284 Minority interest 2A 138,884,162 66,867,526 Deposits 3 14,435,799,524 12,108,321,521 Borrowings 4 2,074,280,008 1,890,618,073 Liabilities on policies in force 2,813,183,300 2,388,673,665 Other liabilities and provisions 5 1,617,044,935 985,446,292 TOTAL CAPITAL AND LIABILITIES 23,640,630,275 19,584,904,970 ASSETS Cash and balances with Reserve Bank of India 6 899,430,231 686,489,413 Balances with banks and money at call and short notice 7 728,258,795 678,075,515 Investments 8 8,271,625,050 6,395,519,671 Advances 9 12,607,762,029 10,838,663,147 Fixed assets 10 132,402,763 109,690,036 Other assets 11 976,409,788 875,453,870 Goodwill on consolidation 24,741,619 1,013,318 TOTAL ASSETS 23,640,630,275 19,584,904,970 Contingent liabilities 12 57,578,163,337 50,359,511,032 Bills for collection 1,007,917,603 864,576,684 Significant accounting policies and notes to accounts 17 & 18 The Schedules referred to above form an integral part of the Consolidated Balance Sheet. As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 Annual Report 2023-24 | 269 Integrated Report Statutory Reports Financial Statements CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED CONSOLIDATED PROFIT AND LOSS ACCOUNT for the year ended March 31, 2024 ` in ‘000s Schedule Year ended 31.03.2024 Year ended 31.03.2023 I. INCOME Interest earned 13 1,595,159,252 1,210,668,098 Other income 14 765,218,020 651,119,912 TOTAL INCOME 2,360,377,272 1,861,788,010 II. EXPENDITURE Interest expended 15 741,081,627 505,433,879 Operating expenses 16 977,827,922 824,390,232 Provisions and contingencies (refer note 18.6) 191,400,276 187,333,629 TOTAL EXPENDITURE 1,910,309,825 1,517,157,740 III. PROFIT/(LOSS) Net profit for the year (before share in profit of associates and minority interest) 450,067,447 344,630,270 Add: Share of profit in associates 10,737,680 9,982,876 Net profit for the year before minority interest 460,805,127 354,613,146 Less: Minority interest 18,241,392 14,246,738 Net profit for the year after minority interest 442,563,735 340,366,408 Profit brought forward 656,386,769 508,988,514 TOTAL PROFIT/(LOSS) 1,098,950,504 849,354,922 IV. APPROPRIATIONS/TRANSFERS Transfer to Statutory Reserve 102,221,000 79,742,000 Transfer to Capital Reserve 332,500 878,200 Transfer to/(from) Investment Fluctuation Reserve 9,927,900 1,043,810 Transfer to Special Reserve 31,353,000 26,254,000 Transfer to/(from) Revenue and other reserves 872,340 50,255,680 Dividend paid during the year 55,985,964 34,794,463 Balance carried over to balance sheet 898,257,800 656,386,769 TOTAL 1,098,950,504 849,354,922 Significant accounting policies and notes to accounts 17 & 18 Earnings per share (refer note 18.1) Basic (`) 63.19 48.86 Diluted (`) 61.96 47.84 Face value per share (`) 2.00 2.00 The Schedules referred to above form an integral part of the Consolidated Profit and Loss Account. As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 270 | Annual Report 2023-24 ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 Cash flow from/(used in) operating activities Profit/(loss) before taxes 596,839,961 458,300,782 Adjustments for: Depreciation and amortisation 19,958,856 16,351,038 Net (appreciation)/depreciation on investments 16,172,037 27,053,455 Provision in respect of non-performing and other assets 9,635,716 (3,653,501) General provision for standard assets 11,658,491 4,898,941 Provision for contingencies & others 8,780,202 54,236,861 (Profit)/loss on sale of fixed assets (144,093) (542,579) Employees stock options expense 7,029,081 5,180,508 (i) 669,930,251 561,825,505 Adjustments for: (Increase)/decrease in investments 167,355,354 (158,286,285) (Increase)/decrease in advances (1,782,646,848) (1,638,931,648) Increase/(decrease) in deposits 2,329,930,107 1,194,663,589 (Increase)/decrease in other assets 18,818,794 (165,971,353) Increase/(decrease) in other liabilities and provisions 302,893,172 277,742,529 (ii) 1,036,350,579 (490,783,168) Refund/(payment) of direct taxes (iii) (133,436,047) (108,754,258) Net cash flow from/(used in) operating activities (i)+(ii)+(iii) (A) 1,572,844,783 (37,711,921) Cash flow from/(used in) investing activities Purchase of fixed assets (36,785,464) (24,676,808) Proceeds from sale of fixed assets 698,893 2,874,176 (Purchase)/sale of held to maturity securities (1,423,224,353) (658,250,590) Net cash flow from/(used in) investing activities (B) (1,459,310,924) (680,053,222) Cash flow from/(used in) financing activities Proceeds from issue of share capital (including ESOPs) 11,708,675 9,420,691 Proceeds from long-term borrowings 391,968,191 417,361,966 Repayment of long-term borrowings (391,468,771) (268,917,978) Net proceeds/(repayment) of short-term borrowings 181,423,005 124,836,960 Dividend paid (55,985,964) (34,794,463) Net cash flow from/(used in) financing activities (C) 137,645,136 247,907,176 Effect of exchange fluctuation on translation reserve (D) 4,234,435 3,163,063 Net increase/(decrease) in cash and cash equivalents (A) + (B) + (C) + (D) 255,413,430 (466,694,904) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED CONSOLIDATED CASH FLOW STATEMENT for the year ended March 31, 2024 Annual Report 2023-24 | 271 Integrated Report Statutory Reports Financial Statements CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED CONSOLIDATED CASH FLOW STATEMENT for the year ended March 31, 2024 (Contd.) ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 Cash and cash equivalents at beginning of the year 1,364,564,928 1,831,259,832 Add: Addition of ICICI Lombard General Insurance Company Limited and I-Process Services (India) Private Limited as a subsidiary in consolidation during the year 7,710,668 - Cash and cash equivalents at end of the year 1,627,689,026 1,364,564,928 1. Cash and cash equivalents include cash in hand, foreign currency notes, balances with RBI, balances with other banks and money at call and short notice. As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 272 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 1 - CAPITAL Authorised capital 12,500,000,000 equity shares of ` 2 each (March 31, 2023: 12,500,000,000 equity shares of ` 2 each) 25,000,000 25,000,000 Equity share capital Issued, subscribed and paid-up capital 6,982,815,731 equity shares of ` 2 each (March 31, 2023: 6,948,771,375 equity shares) 13,965,631 13,897,543 Add: 39,519,912 equity shares of ` 2 each (March 31, 2023: 34,044,356 equity shares) issued during the year 79,040 68,088 14,044,671 13,965,631 Add: Forfeited equity shares1 2,119 2,119 TOTAL CAPITAL 14,046,790 13,967,750 1. On account of forfeiture of 266,089 equity shares of ` 10 each. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 1A - EMPLOYEES STOCK OPTIONS OUTSTANDING Opening balance 7,608,859 2,664,141 Additions during the year1 7,028,323 5,172,383 Deductions during the year2 (584,002) (227,665) Closing balance 14,053,180 7,608,859 1. Represents cost of employee stock options/units recognised during the year. 2. Represents amount transferred to securities premium on account of exercise of employee stock options and to general reserve on lapses of employee stock options. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 2 - RESERVES AND SURPLUS I. Statutory reserve Opening balance 435,778,519 356,036,519 Additions during the year 102,221,000 79,742,000 Deductions during the year - - Closing balance 537,999,519 435,778,519 II. Special Reserve Opening balance 160,232,000 133,978,000 Additions during the year 31,353,000 26,254,000 Deductions during the year - - Closing balance 191,585,000 160,232,000 III. Securities premium Opening balance 507,229,514 497,645,058 Additions during the year1 12,206,924 9,584,456 Deductions during the year - - SCHEDULES forming part of the Consolidated Balance Sheet CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Annual Report 2023-24 | 273 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) ` in ‘000s At 31.03.2024 At 31.03.2023 Closing balance 519,436,438 507,229,514 IV. Investment reserve account Opening balance - - Additions during the year - - Deductions during the year - - Closing balance - - V. Investment fluctuation reserve2 Opening balance 21,758,809 20,714,999 Additions during the year 9,927,900 1,043,810 Deductions during the year - - Closing balance 31,686,709 21,758,809 VI. Capital reserve Opening balance 150,662,553 149,784,353 Additions during the year3 690,995 878,200 Deductions during the year - - Closing balance4 151,353,548 150,662,553 VII. Capital redemption reserve Opening balance 3,500,000 3,500,000 Additions during the year - - Deductions during the year - - Closing balance 3,500,000 3,500,000 VIII. Foreign currency translation reserve Opening balance 15,594,494 12,431,431 Additions during the year5 4,234,435 3,163,063 Deductions during the year - - Closing balance 19,828,929 15,594,494 IX. Revaluation reserve Opening balance 30,918,416 32,284,975 Additions during the year6 1,174,473 839,517 Deductions during the year7 (980,148) (2,206,076) Closing balance 31,112,741 30,918,416 X. Revenue and other reserves Opening balance 141,340,210 88,597,221 Additions during the year 7,381,788 52,798,858 Deductions during the year (144,306) (55,869) Closing balance8,9,10 148,577,692 141,340,210 XI. Balance in profit and loss account 898,257,800 656,386,769 TOTAL RESERVES AND SURPLUS 2,533,338,376 2,123,401,284 1. Includes ` 12,206.2 million (March 31, 2023 : ` 9,576.3 million) on exercise of employee stock options. 2. Represents amount transferred by the Bank to Investment Fluctuation Reserve (IFR) on net profit on sale of AFS and HFT investments during the period. The amount not less than the lower of net profit on sale of AFS and HFT category investments during the period or net profit for the period less mandatory appropriations is required to be transferred to IFR, until the amount of IFR is at least 2% of the HFT and AFS portfolio. CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 274 | Annual Report 2023-24 3. Represents appropriations made by the Bank for profit on sale of investments in held-to-maturity category and profit on sale of land and buildings, net of taxes and transfer to statutory reserve. 4. Includes capital reserve on initial/subsequent investment on subsidiaries and associates amounting to ` 437.6 million (March 31, 2023: ` 79.1 million). 5. Includes transfer of accumulated translation loss of ` 3,396.6 million related to closure of Bank’s Offshore Banking Unit, SEEPZ Mumbai, to profit and loss account in terms of Accounting Standard 11 - The Effects of Changes in Foreign Exchange Rates. 6. Represents gain on revaluation of premises carried out by the Bank and ICICI Home Finance Company Limited. 7. Includes amount transferred from revaluation reserve to general reserve on account of incremental depreciation charge on revaluation and revaluation surplus on premises sold. Also includes the amount of loss on revaluation of certain assets which were held for sale. 8. Includes ` 6,841.3 million towards fair value change account of insurance subsidiaries (March 31, 2023: ` 1,435.9 million). 9. Includes unrealised profit/(loss), net of tax, of ` 20.1 million (March 31, 2023: ` 161.5 million) pertaining to the investments in the available-for-sale category of ICICI Bank UK PLC. 10. Includes unrealised profit/(loss) pertaining to the investments of venture capital funds. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 2A - MINORITY INTEREST Opening minority interest 66,867,526 59,808,935 Subsequent increase/(decrease) during the year1 72,016,636 7,058,591 CLOSING MINORITY INTEREST 138,884,162 66,867,526 1. At March 31, 2024, includes minority interest relating to ICICI Lombard General Insurance Company Limited amounting to ` 63,102.1 million on becoming a subsidiary. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 3 - DEPOSITS A. I. Demand deposits i) From banks 47,613,641 49,978,962 ii) From others 1,940,571,390 1,608,349,299 II. Savings bank deposits 4,060,887,215 3,848,298,564 III. Term deposits i) From banks 208,627,693 113,475,314 ii) From others 8,178,099,585 6,488,219,382 TOTAL DEPOSITS 14,435,799,524 12,108,321,521 B. I. Deposits of branches in India 13,954,785,283 11,638,079,242 II. Deposits of branches/ subsidiaries outside India 481,014,241 470,242,279 TOTAL DEPOSITS 14,435,799,524 12,108,321,521 SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Annual Report 2023-24 | 275 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 4 - BORROWINGS I. Borrowings in India i) Reserve Bank of India1 26,186,900 18,899,200 ii) Other banks 104,714,012 71,911,178 iii) Financial institutions2 661,840,505 608,942,331 iv) Borrowings in the form of a) Deposits 38,106,055 36,624,470 b) Commercial paper 172,960,808 98,022,849 c) Bonds and debentures (excluding subordinated debt) 525,303,878 506,782,072 v) Capital instruments a) Innovative Perpetual Debt Instruments (IPDI) (qualifying as additional Tier 1 capital) - 51,400,000 b) Unsecured redeemable debentures/bonds (subordinated debt included in Tier 2 capital) 48,594,148 53,206,653 TOTAL BORROWINGS IN INDIA 1,577,706,306 1,445,788,753 II. Borrowings outside India i) Capital instruments Unsecured redeemable debentures/bonds (subordinated debt included in Tier 2 capital) 4,135,575 5,962,274 ii) Bonds and notes 133,372,570 133,419,412 iii) Other borrowings 359,065,557 305,447,634 TOTAL BORROWINGS OUTSIDE INDIA 496,573,702 444,829,320 TOTAL BORROWINGS 2,074,280,008 1,890,618,073 1. Represents borrowings made by the Group under Liquidity Adjustment Facility (LAF) and Standing Liquidity Facility (SLF). 2. Includes borrowings made by the Group under repo and refinance. 3. Secured borrowings in I and II above amounting to ` 266,868.8 million (March 31, 2023: ` 239,969.1 million) other than the borrowings under collateralised borrowing and lending obligation, market repurchase transactions (including tri-party repo) with banks and financial institutions and transactions under liquidity adjustment facility and marginal standing facility. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 5 - OTHER LIABILITIES AND PROVISIONS I. Bills payable 128,193,100 136,037,076 II. Inter-office adjustments (net) 420,905 3,228,016 III. Interest accrued 38,985,508 33,390,137 IV. Sundry creditors 639,120,659 242,830,603 V. General provision for standard assets 61,602,061 49,946,771 VI. Unrealised loss on foreign exchange and derivative contracts 176,519,175 183,764,747 VII. Others (including provisions)1 572,203,527 336,248,942 TOTAL OTHER LIABILITIES AND PROVISIONS 1,617,044,935 985,446,292 1. Includes contingency provision of the Bank amounting to ` 131,000.0 million (March 31, 2023: ` 131,000.0 million) and specific provision for standard loans amounting to ` 9,795.3 million (March 31, 2023: ` 14,946.9 million) of the Bank. CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 276 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 6 - CASH AND BALANCES WITH RESERVE BANK OF INDIA I. Cash in hand (including foreign currency notes) 89,558,463 86,812,982 II. Balances with Reserve Bank of India 809,871,768 599,676,431 (a) in current account 625,031,768 480,256,431 (b) in other accounts1 184,840,000 119,420,000 TOTAL CASH AND BALANCES WITH RESERVE BANK OF INDIA 899,430,231 686,489,413 1. Represents lending made by the Group under Liquidity Adjustment Facility (LAF) and Standing Deposit Facility (SDF). ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 7 - BALANCES WITH BANKS AND MONEY AT CALL AND SHORT NOTICE I. In India i) Balances with banks a) In current accounts 3,553,758 3,103,280 b) In other deposit accounts 125,802,157 107,287,660 ii) Money at call and short notice a) With banks 4,170,250 8,217,000 b) With other institutions1 180,191,880 59,652,392 TOTAL 313,718,045 178,260,332 II. Outside India i) In current accounts 218,885,291 310,635,743 ii) In other deposit accounts 80,151,629 26,782,094 iii) Money at call and short notice 115,503,830 162,397,346 TOTAL 414,540,750 499,815,183 TOTAL BALANCES WITH BANKS AND MONEY AT CALL AND SHORT NOTICE 728,258,795 678,075,515 1. Includes lending made by the Group under reverse repo. SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Annual Report 2023-24 | 277 Integrated Report Statutory Reports Financial Statements ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 8 - INVESTMENTS I. Investments in India [net of provisions] i) Government securities 5,055,928,340 3,960,623,208 ii) Other approved securities - - iii) Shares (includes equity and preference shares) 219,751,396 127,225,123 iv) Debentures and bonds (including commercial paper and certificate of deposits) 967,627,791 526,539,870 v) Assets held to cover linked liabilities of life insurance business1 1,648,424,014 1,440,580,565 vi) Investment in associates2 15,102,339 64,140,775 vii) Others (mutual fund units, pass through certificates, security receipts and other related investments) 222,672,130 128,457,645 TOTAL INVESTMENTS IN INDIA 8,129,506,010 6,247,567,186 II. Investments outside India [net of provisions] i) Government securities 79,489,098 89,972,472 ii) Others (equity shares, bonds and certificate of deposits) 62,629,942 57,980,013 TOTAL INVESTMENTS OUTSIDE INDIA 142,119,040 147,952,485 TOTAL INVESTMENTS 8,271,625,050 6,395,519,671 A. Investments in India Gross value of investments1 8,133,543,306 6,275,011,504 Less: Aggregate of provision/depreciation/(appreciation) 4,037,296 27,444,318 Net investments 8,129,506,010 6,247,567,186 B. Investments outside India Gross value of investments 146,627,653 153,368,477 Less: Aggregate of provision/depreciation/(appreciation) 4,508,613 5,415,992 Net investments 142,119,040 147,952,485 TOTAL INVESTMENTS 8,271,625,050 6,395,519,671 1. Includes net appreciation amounting to ` 384,547.0 million (March 31, 2023: ` 169,588.6 million) on investments held to cover linked liabilities of life insurance business. 2. Includes goodwill on consolidation of associates amounting to ` 163.1 million (March 31, 2023: ` 221.9 million). SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 278 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 9 - ADVANCES [net of provisions] A. i) Bills purchased and discounted1 500,789,314 497,557,667 ii) Cash credits, overdrafts and loans repayable on demand 3,577,416,833 2,866,747,206 iii) Term loans 8,529,555,882 7,474,358,274 TOTAL ADVANCES 12,607,762,029 10,838,663,147 B. i) Secured by tangible assets (includes advances against book debts) 9,000,168,618 7,713,019,424 ii) Covered by bank/government guarantees 91,804,264 159,202,710 iii) Unsecured 3,515,789,147 2,966,441,013 TOTAL ADVANCES 12,607,762,029 10,838,663,147 C. I. Advances in India i) Priority sector 3,739,060,521 2,807,812,582 ii) Public sector 510,801,139 516,152,443 iii) Banks 16,359,843 7,698,171 iv) Others 7,598,518,682 6,769,499,593 TOTAL ADVANCES IN INDIA 11,864,740,185 10,101,162,789 II. Advances outside India i) Due from banks 14,422,000 8,076,480 ii) Due from others a) Bills purchased and discounted 116,325,237 152,553,948 b) Syndicated and term loans 257,939,039 245,267,859 c) Others 354,335,568 331,602,071 TOTAL ADVANCES OUTSIDE INDIA 743,021,844 737,500,358 TOTAL ADVANCES 12,607,762,029 10,838,663,147 1. Net of bills re-discounted amounting to ` 5,000.0 million (March 31, 2023: ` 10,000.0 million). SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Annual Report 2023-24 | 279 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 10 - FIXED ASSETS I. Premises Gross block At cost at March 31 of preceding year 94,340,437 94,345,827 Additions during the year1,4 9,806,147 2,793,216 Deductions during the year (1,171,073) (2,798,606) Closing balance 102,975,511 94,340,437 Depreciation At March 31 of preceding year 25,545,325 23,514,011 Charge during the year2,4 3,196,062 2,486,973 Deductions during the year (641,864) (455,659) Total depreciation 28,099,523 25,545,325 Net block3 74,875,988 68,795,112 II. Other fixed assets (including furniture and fixtures) Gross block At cost at March 31 of preceding year 111,002,632 98,784,940 Additions during the year5,6 42,594,957 18,437,437 Deductions during the year (4,553,076) (6,219,745) Closing balance 149,044,513 111,002,632 Depreciation At March 31 of preceding year 73,174,464 66,817,309 Charge during the year5,6 25,873,227 12,459,081 Deductions during the year (4,663,727) (6,101,926) Total depreciation 94,383,964 73,174,464 Net block 54,660,549 37,828,168 III. Lease assets Gross block At cost at March 31 of preceding year 17,902,406 17,890,746 Additions during the year 530 11,660 Deductions during the year (2,650) - Closing balance7 17,900,286 17,902,406 Depreciation At March 31 of preceding year 14,835,650 14,636,086 Charge during the year 199,375 199,564 Deductions during the year (965) - Total depreciation, accumulated lease adjustment and provisions 15,034,060 14,835,650 Net block 2,866,226 3,066,756 TOTAL FIXED ASSETS 132,402,763 109,690,036 1. Includes net revaluation gain amounting to ` 1,194.7 (March 31, 2023: ` 811.7 million) on account of revaluation carried out by the Bank and its housing finance subsidiary. 2. Including depreciation charge on account of revaluation of ` 812.5 million for the year ended March 31, 2024 (year ended March 31, 2023: ` 755.2 million). 3. Includes assets amounting to ` 8.8 million of the Bank (March 31, 2023: ` 428.8 million) which are held for sale. 4. Includes premises cost amounting to ` 3,723.1 million and accumulated depreciation amounting to ` 305.5 million pertaining to ICICI Lombard General Insurance Company Limited on becoming a subsidiary w.e.f. February 29, 2024. 5. Includes other fixed assets cost amounting to ` 12,054.0 million and accumulated depreciation amounting to ` 9,567.3 million pertaining to ICICI Lombard General Insurance Company Limited on becoming a subsidiary w.e.f. February 29, 2024. 6. Includes other fixed assets cost amounting to ` 47.5 million and accumulated depreciation amounting to ` 43.8 million pertaining to I-Process Services (India) Private Limited on becoming a subsidiary w.e.f. March 20, 2024. 7. Includes assets taken on lease by the Bank amounting to ` 1,185.7 million (March 31, 2023: ` 1,187.8 million). CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 280 | Annual Report 2023-24 ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 11 - OTHER ASSETS I. Inter-office adjustments (net) - - II. Interest accrued 208,551,090 151,100,647 III. Tax paid in advance/tax deducted at source (net) 12,595,878 20,372,701 IV. Stationery and stamps 251,899 379,124 V. Non-banking assets acquired in satisfaction of claims1,2 - - VI. Advance for capital assets 8,831,572 9,009,963 VII. Deposits 72,688,283 54,892,587 VIII. Deferred tax asset (net) (refer note 18.9) 63,115,807 76,194,441 IX. Deposits in Rural Infrastructure and Development Fund 200,918,559 216,216,187 X. Unrealised gain on foreign exchange and derivative contracts 169,989,164 178,022,993 XI. Others 239,467,536 169,265,227 TOTAL OTHER ASSETS 976,409,788 875,453,870 1. Assets amounting to ` 2.6 million were transferred from banking assets to non banking asset by the Bank during the year ended March 31, 2024 (year ended March 31, 2023: Nil). Assets amounting to ` 827.7 million were sold by the Bank during the year ended March 31, 2024 (year ended March 31, 2023: Nil). 2. Net of provision held by the Bank amounting to ` 28,189.9 million (March 31, 2023: ` 29,011.8 million). ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 12 - CONTINGENT LIABILITIES I. Claims against the Group not acknowledged as debts 110,275,158 88,006,837 II. Liability for partly paid investments 3,573,880 4,790,087 III. Liability on account of outstanding forward exchange contracts1 15,786,739,940 15,492,543,076 IV. Guarantees given on behalf of constituents a) In India 1,365,548,848 1,102,115,003 b) Outside India 121,463,607 134,004,861 V. Acceptances, endorsements and other obligations 514,009,699 435,202,811 VI. Currency swaps1 541,254,033 570,626,929 VII. Interest rate swaps, currency options and interest rate futures1 39,017,579,690 32,435,271,591 VIII. Other items for which the Group is contingently liable 117,718,482 96,949,837 TOTAL CONTINGENT LIABILITIES 57,578,163,337 50,359,511,032 1. Represents notional amount. SCHEDULES forming part of the Consolidated Balance Sheet (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Annual Report 2023-24 | 281 Integrated Report Statutory Reports Financial Statements ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 SCHEDULE 13 - INTEREST EARNED I. Interest/discount on advances/bills 1,165,897,763 879,292,351 II. Income on investments (including dividend) 381,070,710 279,050,297 III. Interest on balances with Reserve Bank of India and other inter-bank funds 26,498,839 23,054,570 IV. Others1,2 21,691,940 29,270,880 TOTAL INTEREST EARNED 1,595,159,252 1,210,668,098 1. Includes interest on income tax refunds amounting to ` 2,828.2 million (March 31, 2023: ` 1,203.2 million). 2. Includes interest and amortisation of premium on non-trading interest rate swaps and foreign currency swaps. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 14 - OTHER INCOME I. Commission, exchange and brokerage 235,718,656 196,484,672 II. Profit/(loss) on sale of investments (net) 36,689,228 12,730,117 III. Profit/(loss) on revaluation of investments (net) 1,182,467 (1,317,590) IV. Profit/(loss) on sale of land, buildings and other assets (net)1 144,093 542,579 V. Profit/(loss) on exchange/derivative transactions (net) 30,860,575 30,509,008 VI. Premium and other operating income from insurance business 458,528,108 411,367,848 VII. Miscellaneous income (including lease income) 2,094,893 803,278 TOTAL OTHER INCOME 765,218,020 651,119,912 1. Includes profit/(loss) on sale of assets given on lease. ` in ‘000s At 31.03.2024 At 31.03.2023 SCHEDULE 15 - INTEREST EXPENDED I. Interest on deposits 587,844,555 394,765,407 II. Interest on Reserve Bank of India/inter-bank borrowings 32,114,853 13,380,975 III. Others (including interest on borrowings of erstwhile ICICI Limited) 121,122,219 97,287,497 TOTAL INTEREST EXPENDED 741,081,627 505,433,879 SCHEDULES forming part of the Consolidated Profit and Loss Account CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 282 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Profit and Loss Account (Contd.) ` in ‘000s Year ended 31.03.2024 Year ended 31.03.2023 SCHEDULE 16 - OPERATING EXPENSES I. Payments to and provisions for employees 191,719,774 152,341,687 II. Rent, taxes and lighting1 17,054,394 15,846,567 III. Printing and stationery 3,610,245 2,713,187 IV. Advertisement and publicity 28,292,745 32,807,911 V. Depreciation on property 19,152,745 14,946,054 VI. Depreciation (including lease equalisation) on leased assets 199,361 199,538 VII. Directors' fees, allowances and expenses 146,009 137,405 VIII. Auditors' fees and expenses 264,719 248,666 IX. Law charges 1,494,968 1,771,894 X. Postages, courier, telephones, etc. 8,875,883 7,475,175 XI. Repairs and maintenance 36,171,827 34,644,161 XII. Insurance 16,843,829 14,788,575 XIII. Direct marketing agency expenses 37,986,800 32,599,179 XIV. Claims and benefits paid pertaining to insurance business 78,282,341 53,426,955 XV. Other expenses pertaining to insurance business2 424,318,817 363,124,210 XVI. Other expenditure3,4 113,413,465 97,319,068 TOTAL OPERATING EXPENSES 977,827,922 824,390,232 1. Includes lease expense amounting to ` 13,877.7 million (March 31, 2023: ` 12,512.8 million). 2. Includes commission expenses and reserves for actuarial liabilities (including the investible portion of the premium on the unit-linked policies). 3. Includes expenses on purchase of Priority Sector Lending Certificates (PSLC) for the Bank amounting to ` 16,428.5 million (March 31, 2023: ` 15,035.2 million). 4. Includes expenses on reward program by the Bank amounting to ` 18,414.8 million (March 31, 2023: ` 12,764.2 million). CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Annual Report 2023-24 | 283 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULE 17 SIGNIFICANT ACCOUNTING POLICIES Overview ICICI Bank Limited, together with its subsidiaries and associates (collectively, the Group), is a diversified financial services group providing a wide range of banking and financial services including commercial banking, retail banking, project and corporate finance, working capital finance, insurance, venture capital and private equity, investment banking, broking and treasury products and services. ICICI Bank Limited (the Bank), incorporated in Vadodara, India is a publicly held banking company governed by the Banking Regulation Act, 1949. Principles of consolidation The consolidated financial statements include the financials of ICICI Bank, its subsidiaries and associates. Entities, in which the Bank holds, directly or indirectly, through subsidiaries and other consolidating entities, more than 50.00% of the voting rights or where it exercises control, over the composition of board of directors/governing body, are fully consolidated on a line-by-line basis in accordance with the provisions of AS 21 on ‘Consolidated Financial Statements’. Investments in entities where the Bank has the ability to exercise significant influence are accounted for under the equity method of accounting and the pro-rata share of their profit/(loss) is included in the consolidated profit and loss account. Assets, liabilities, income and expenditure of jointly controlled entities are consolidated using the proportionate consolidation method. Under this method, the Bank’s share of each of the assets, liabilities, income and expenses of the jointly controlled entity is reported in separate line items in the consolidated financial statements. The Bank does not consolidate entities where the significant influence/control is intended to be temporary or entities which operate under severe long-term restrictions that impair their ability to transfer funds to parent/investing entity or where the objective of control is not to obtain economic benefit from their activities. All significant inter-company balances and transactions with subsidiaries and entities consolidated as per AS-21 have been eliminated on consolidation. Basis of preparation The accounting and reporting policies of the Group used in the preparation of the consolidated financial statements conform to Generally Accepted Accounting Principles in India (Indian GAAP), the guidelines issued by the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDAI) from time to time and the Accounting Standards notified under Section 133 of the Companies Act, 2013 read together with Rule 7 of the Companies (Accounts) Rules, 2014 and Companies (Accounting Standard) Rule 2021, as applicable to relevant companies and practices generally prevalent in the banking industry in India. In the case of the foreign subsidiaries, Generally Accepted Accounting Principles as applicable to the respective foreign subsidiaries are followed. The Group follows the accrual method of accounting except where otherwise stated, and the historical cost convention. In case the accounting policies followed by a subsidiary are different from those followed by the Bank, the same have been disclosed in the respective accounting policy. Further, ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. Accordingly, ICICI Lombard General Insurance Company Limited has been accounted for the equity method prescribed by AS-23 on ‘Accounting for Investments in Associates in Consolidated Financial Statements’ till February 29, 2024 and has been consolidated on a line-by-line basis as prescribed by AS-21 on ‘Consolidated Financial Statements’ from March 1, 2024 till the reporting date. The preparation of consolidated financial statements requires management to make estimates and assumptions that are considered in the reported amounts of assets and liabilities (including contingent liabilities) as of the date of the consolidated financial statements and the reported income and expenses during the reporting period. Management believes that the estimates used in the preparation of the consolidated financial statements are prudent and reasonable. Actual results could differ from these estimates. The impact of any revision in these estimates is recognised prospectively from the period of change. 284 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The consolidated financial statements include the results of the following entities in addition to the Bank. Sr. no. Name of the entity Country of incorporation Nature of relationship Nature of business Ownership interest 1. ICICI Bank UK PLC United Kingdom Subsidiary Banking 100.00% 2. ICICI Bank Canada Canada Subsidiary Banking 100.00% 3. ICICI Securities Limited India Subsidiary Securities broking and merchant banking 74.73% 4. ICICI Securities Holdings Inc.1 USA Subsidiary Holding company 100.00% 5. ICICI Securities Inc.1 USA Subsidiary Securities broking 100.00% 6. ICICI Securities Primary Dealership Limited India Subsidiary Securities investment, trading and underwriting 100.00% 7. ICICI Venture Funds Management Company Limited India Subsidiary Private equity/ venture capital fund management 100.00% 8. ICICI Home Finance Company Limited India Subsidiary Housing finance 100.00% 9. ICICI Trusteeship Services Limited India Subsidiary Trusteeship services 100.00% 10. ICICI Investment Management Company Limited India Subsidiary Asset management and Investment advisory 100.00% 11. ICICI International Limited Mauritius Subsidiary Asset management 100.00% 12. ICICI Prudential Pension Funds Management Company Limited2 India Subsidiary Pension fund management and Points of Presence 100.00% 13. ICICI Prudential Life Insurance Company Limited India Subsidiary Life insurance 51.20% 14. ICICI Lombard General Insurance Company Limited3 India Subsidiary General insurance 51.27% 15. ICICI Prudential Asset Management Company Limited India Subsidiary Asset management 51.00% 16. ICICI Prudential Trust Limited India Subsidiary Trusteeship services 50.80% 17. I-Process Services (India) Private Limited4 India Subsidiary Services related to back end operations 100.00% 18. ICICI Strategic Investments Fund India Consolidated as per AS 21 Venture capital fund 100.00% 19. NIIT Institute of Finance Banking and Insurance Training Limited5 India Associate Education and training in banking, finance and insurance 18.79% 20. ICICI Merchant Services Private Limited5 India Associate Merchant acquiring and servicing 19.01% 21. India Infradebt Limited5 India Associate Infrastructure re-finance 42.33% 22. India Advantage Fund-III5 India Associate Venture capital fund 24.10% 23. India Advantage Fund-IV5 India Associate Venture capital fund 47.14% 24. Arteria Technologies Private Limited5 India Associate Software company 19.98% 1. ICICI Securities Holding Inc. is a wholly owned subsidiary of ICICI Securities Limited. ICICI Securities Inc. is a wholly owned subsidiary of ICICI Securities Holding Inc. 2. ICICI Prudential Pension Funds Management Company Limited is a wholly owned subsidiary of ICICI Prudential Life Insurance Company Limited. 3. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. 4. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. 5. These entities have been accounted as per the equity method as prescribed by AS-23 on ‘Accounting for Investments in Associates in Consolidated Financial Statements’. Annual Report 2023-24 | 285 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Comm Trade Services Limited has not been consolidated under AS-21, since the investment is temporary in nature. Falcon Tyres Limited, in which the Bank holds 26.39% equity shares has not been accounted as per equity method under AS-23, since the investment is temporary in nature. SIGNIFICANT ACCOUNTING POLICIES 1. Translation of foreign currency items The consolidated financial statements of the Group are reported in Indian rupees (`), the national currency of India. Foreign currency income and expenditure items of domestic operations are translated at the exchange rates prevailing on the date of the transaction. Income and expenditure items of integral foreign operations (representative offices) are translated at daily closing rates, and income and expenditure items of non-integral foreign operations (foreign branches, offshore banking units, foreign subsidiaries) are translated at quarterly average closing rates. Monetary foreign currency assets and liabilities of domestic and integral foreign operations are translated at closing exchange rates notified by Foreign Exchange Dealers’ Association of India (FEDAI) relevant to the balance sheet date and the resulting gains/losses are recognised in the profit and loss account. Both monetary and non-monetary foreign currency assets and liabilities of non-integral foreign operations are translated at relevant closing exchange rates notified by FEDAI at the balance sheet date and the resulting gains/ losses from exchange differences are accumulated in the foreign currency translation reserve until the disposal of the net investment in the non-integral foreign operations. Pursuant to RBI guideline, the Bank does not recognise the cumulative/proportionate amount of such exchange differences as income or expenses, which relate to repatriation of accumulated retained earnings from overseas operations, in the profit and loss account. Contingent liabilities on account of guarantees, endorsements and other obligations denominated in foreign currencies are disclosed at the closing exchange rates notified by FEDAI relevant to the balance sheet date. 2. Revenue recognition a) Interest income is recognised in the profit and loss account as it accrues, except in the case of non-performing assets (NPAs) where it is recognised upon realisation, as per the income recognition and asset classification norms of RBI/NHB/other applicable guidelines. b) Income on discounted instruments is recognised over the tenure of the instrument. c) Dividend income is accounted on an accrual basis when the right to receive the dividend is established. d) Loan processing fee is accounted for upfront when it becomes due except in the case of foreign banking subsidiaries, where it is amortised over the period of the loan. e) Project appraisal/structuring fee is accounted for on the completion of the agreed service. f) Arranger fee is accounted for as income when a significant portion of the arrangement is completed and right to receive is established. g) Commission received on guarantees and letters of credit issued is amortised on a straight-line basis over the period of the guarantee/letters of credit. h) Fund management and portfolio management fees are recognised on an accrual basis. i) The annual/renewal fee on credit cards, debit cards and prepaid cards are amortised on a straight-line basis over one year. j) All other fees are accounted for as and when they become due where the Group is reasonably certain of ultimate collection. k) Fees paid/received for priority sector lending certificates (PSLC) is amortised on straight-line basis over the period of the certificate. 286 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED l) Income from securities brokerage activities is recognised as income on the trade date of the transaction. Brokerage income in relation to public or other issuances of securities is recognised based on mobilisation and terms of agreement with the client. m) Life insurance premium for non-linked policies is recognised as income (net of goods and service tax) when due from policyholders. For unit linked business, premium is recognised when the associated units are created. Premium on lapsed policies is recognised as income when such policies are reinstated. Top-up premiums paid by unit linked policyholders’ are considered as single premium and recognised as income when the associated units are created. Income from unit linked policies, which includes fund management charges, policy administration charges, mortality charges and other charges, if any, are recovered from the linked funds in accordance with the terms and conditions of the policy and are recognised when due. n) In case of general insurance business, premium including reinsurance accepted (net of goods & services tax) other than for long-term (with term more than one year) motor insurance policies for new cars and new two wheelers sold on or after September 1, 2018 is recorded on receipt of complete information, for the policy period at the commencement of risk. For crop insurance, the premium is accounted based on management estimates that are progressively actualised on receipt of information. For installment cases, premium is recorded on installment due dates. Reinstatement premium is recorded as and when such premiums are recovered. Premium earned including reinstatement premium and re-insurance accepted is recognised as income over the period of risk or the contract period based on 1/365 method, whichever is appropriate on a gross basis other than instalment premiums received for group health policies, wherein the instalment premiums are recognised over the balance policy period. Any subsequent revisions to premium as and when they occur are recognised over the remaining period of risk or contract period, as applicable. In case of long-term motor insurance policies for new cars and new two wheelers sold on or after September 1, 2018, premium received (net of goods & services tax) for third party liability coverage is recognised equally over the policy period at the commencement of risk on 1/n basis where ‘n’ denotes the term of the policy in years and premium received for own damage coverage is recognised in accordance with movement of Insured Declared Value (IDV) over the period of risk, on receipt of complete information. Reinstatement premium is recorded as and when such premiums are recovered. Premium allocated for the year is recognised as income earned based on 1/365 method, on a gross basis. Reinstatement premium is allocated on the same basis as the original premium over the balance term of the policy. Any subsequent revisions to premium as and when they occur are recognised on the same basis as the original premium over the balance term of the policy. Adjustments to premium income arising on cancellation of policies are recognised in the period in which the policies are cancelled. Adjustments to premium income for corrections to area covered under crop insurance are recognised in the period in which the information is confirmed by the concerned government/nodal agency. Commission on reinsurance ceded is recognised as income in the period of ceding the risk. Profit commission under reinsurance treaties, wherever applicable, is recognised as income in the year of final determination of profits as confirmed by reinsurers and combined with commission on reinsurance ceded. Sliding scale commission under reinsurance treaties, wherever applicable, is determined at every balance sheet date as per terms of the respective treaties. Any changes in the previously accrued commission is recognised immediately and any additional accrual is recognised on confirmation from reinsurers. Such commission is combined with commission on reinsurance ceded. o) In case of life insurance business, reinsurance premium ceded/accepted is accounted in accordance with the terms of the relevant treaties/arrangements with the reinsurer/insurer. Profit commission on reinsurance ceded is netted off against premium ceded on reinsurance. p) In case of general insurance business, insurance premium on ceding of the risk other than for long-term motor insurance policies for new cars and new two wheelers sold on or after September 1, 2018 is recognised simultaneously along with the insurance premium in accordance with reinsurance arrangements with the Annual Report 2023-24 | 287 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED reinsurers. In case of long-term motor insurance policies for new cars and new two wheelers sold on or after September 1, 2018, reinsurance premium is recognised on the insurance premium allocated for the year simultaneously along with the recognition of the insurance premium in accordance with the reinsurance arrangements with the reinsurers. Any subsequent revision to premium ceded is recognised in the period of such revision. Adjustment to reinsurance premium arising on cancellation of policies is recognised in the period in which the policies are cancelled. Adjustments to reinsurance premium for corrections to area covered under crop insurance are recognised simultaneously along with related premium income. q) In the case of general insurance business, premium deficiency is recognised when the sum of expected claim costs and related expenses and maintenance costs exceed the reserve for unexpired risks and is computed at a segmental revenue account level. The premium deficiency is calculated and duly certified by the Appointed Actuary. 3. Stock based compensation The following entities within the group have granted stock options/units to their employees: • ICICI Bank Limited • ICICI Prudential Life Insurance Company Limited • ICICI Lombard General Insurance Company Limited • ICICI Securities Limited The Employees Stock Option Scheme 2000 (Option Scheme) of the Bank provides for grant of options on the Bank’s equity shares to wholetime directors and employees of the Bank and its subsidiaries. The options granted vest in a graded manner and may be exercised within a specified period. The Employees Stock Unit Scheme - 2022 (Unit Scheme) provides for grant of units at face value to the eligible employees of the Bank and its subsidiaries. The units granted vest in a graded manner and as per vesting criteria and may be exercised within a specified period. Till March 31, 2021, the Bank recognised cost of stock options granted under Employee Stock Option Scheme, using intrinsic value method. Under Intrinsic value method, options cost is measured as the excess, if any, of the fair market price of the underlying stock over the exercise price on the grant date. Pursuant to RBI clarification dated August 30, 2021, the cost of stock options/units granted after March 31, 2021 is recognised based on fair value method. The cost of stock options/units granted up to March 31, 2021 continues to be recognised on intrinsic value method. The Bank uses Black-Scholes model to fair value the options/units on the grant date and the inputs used in the valuation model include assumptions such as the expected life of the share option/ units, volatility, risk free rate and dividend yield. The cost of stock options/units is recognised in the profit and loss account over the vesting period. ICICI Prudential Life Insurance Company Limited, ICICI Lombard General Insurance Company Limited and ICICI Securities Limited have also formulated similar stock options/units schemes for their employees for grant of equity shares of their respective companies. The intrinsic value method is followed by them to account for their stock-based employee compensation plans. Compensation cost is measured as the excess, if any, of the fair market price of the underlying stock over the exercise price on the grant date and amortised over the vesting period. The fair market price is the closing price on the stock exchange with the highest trading volume of the underlying shares of the Bank, ICICI Prudential Life Insurance Company Limited, ICICI Lombard General Insurance Company Limited and ICICI Securities Limited, immediately prior to the grant date. The banking subsidiaries namely, ICICI Bank UK PLC and ICICI Bank Canada, account for the cost of the options/units granted to employees by ICICI Bank using the fair value method as followed by the Bank. 288 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 4. Income taxes Income tax expense is the aggregate amount of current tax and deferred tax expense incurred by the Group. The current tax expense and deferred tax expense is determined in accordance with the provisions of the Income Tax Act, 1961 and as per Accounting Standard 22 - Accounting for Taxes on Income respectively. Deferred tax adjustments comprise changes in the deferred tax assets or liabilities during the year and change in tax rate. Deferred tax assets and liabilities are recognised by considering the impact of timing differences between taxable income and accounting income for the current year and carry forward losses. Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. The impact of changes in the deferred tax assets and liabilities is recognised in the profit and loss account. Deferred tax assets are recognised and re-assessed at each reporting date, based upon the management’s judgement as to whether their realisation is considered as reasonably certain. However, in case of domestic companies, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is virtual certainty of realisation of such assets. In the consolidated financial statements, deferred tax assets and liabilities are computed at an individual entity level and aggregated for consolidated reporting. Minimum Alternate Tax (MAT) credit is recognised as an asset to the extent there is convincing evidence that the Group will pay normal income tax during specified period, i.e., the period for which MAT credit is allowed to be carried forward as per prevailing provisions of the Income Tax Act 1961. In accordance with the recommendation contained in the guidance note issued by ICAI, MAT credit is to be recognised as an asset in the year in which it becomes eligible for set off against normal income tax. The Group reviews MAT credit entitlements at each balance sheet date and writes down the carrying amount to the extent there is no longer convincing evidence to the effect that the Group will pay normal income tax during the specified period. 5. Claims and benefits paid In the case of general insurance business, claims incurred comprise claims paid, estimated liability for outstanding claims made following a loss occurrence reported and estimated liability for claims incurred but not reported (IBNR) and claims incurred but not enough reported (IBNER). Further, claims incurred also include specific claim settlement costs such as survey/legal fees and other directly attributable costs. Claims (net of amounts receivable from re- insurers/co-insurers) are recognised on the date of intimation based on internal management estimates or on estimates from surveyors/insured in the respective revenue account. Estimated liability for outstanding claims at the balance sheet date is recorded net of claims recoverable from/payable to co-insurers/re-insurers and salvage to the extent there is certainty of realisation and includes provision for solatium fund. Salvaged stock is recognised at estimated net realisable value based on independent valuer’s report. Estimated liability for outstanding claim is determined by the management on the basis of ultimate amounts likely to be paid on each claim based on the past experience and in cases where claim payment period exceeds four years based on actuarial valuation. These estimates are progressively revalidated on availability of further information. Claims IBNR represent that amount of claims that may have been incurred during the accounting period but have not been reported or claimed. The claims IBNR provision also includes provision, if any, required for claims that have been incurred but are not enough reported (IBNER). The provision for claims IBNR/claims IBNER is based on an actuarial estimate duly certified by the Appointed Actuary of the entity. The actuarial estimate is derived in accordance with relevant IRDAI regulations and Guidance Note GN 21 issued by the Institute of Actuaries of India. In the case of life insurance business, benefits paid comprise policy benefits and claim settlement costs, if any. Death and rider claims are accounted for on receipt of intimation. Survival and maturity benefits are accounted when due. Withdrawals and surrenders under non linked policies are accounted on the receipt of intimation. Amount payable on lapsed/discontinued policies are accounted for on expiry of lock-in-period of these policies. Surrenders, withdrawals and lapsation are disclosed at net of charges recoverable. Claim settlement cost, legal and other fees Annual Report 2023-24 | 289 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED form part of claim cost wherever applicable. Reinsurance claims receivable are accounted for in the period in which the claim is intimated. Repudiated claims and other claims disputed before the judicial authorities are provided for on prudent basis as considered appropriate by the management. 6. Liability for life policies in force In the case of life insurance business, the actuarial liabilities for life policies in force and policies where premiums are discontinued but a liability exists as at the valuation date, are calculated in accordance with accepted actuarial practice, requirements of Insurance Act, 1938, as amended from time to time, and regulations notified by the Insurance Regulatory and Development Authority of India, relevant Guidance Notes and Actuarial Practice Standards of the Institute of Actuaries of India. 7. Reserve for unexpired risk Reserve for unexpired risk is recognised net of re-insurance ceded and represents premium written that is attributable to and is to be allocated to succeeding accounting periods. For fire, marine cargo and miscellaneous business it is calculated on a daily pro-rata basis, except in the case of marine hull business which is computed at 100.00% of net premium written on all unexpired policies at balance sheet date. 8. Actuarial method and valuation In the case of life insurance business, the actuarial liability on both participating and non-participating policies is calculated using the gross premium method, using assumptions for interest, mortality, morbidity, expense and inflation, and in the case of participating policies, future bonuses together with allowance for taxation and allocation of profits to shareholders. These assumptions are determined as prudent estimates at the date of valuation with allowances for adverse deviations. The liability for the unexpired portion of the risk for the non-unit liabilities of linked business and attached riders is the higher of liability calculated using discounted cash flows and unearned premium reserves. The unit liability in respect of linked business has been taken as the value of the units standing to the credit of policyholders, using the Net Asset Value (NAV) prevailing at the valuation date. An unexpired risk reserve and a reserve in respect of claims incurred but not reported are created, for one year renewable group term insurance. The interest rates used for valuing the liabilities are in the range of 5.04% to 6.56% per annum (previous year – 4.99% to 6.58% per annum). Mortality rates used are based on the published “Indian Assured Lives Mortality (2012-2014) Ult.” mortality table for assurances and “Indian Individual Annuitant’s Mortality Table (2012-15)” table for annuities, adjusted to reflect expected experience while morbidity rates used are based on CIBT 93 table, adjusted for expected experience, or on risk rates supplied by reinsurers. Expenses are provided for at least at current levels, in respect of renewal expenses, with no allowance for future improvements. Per policy renewal expenses for regular premium policies are assumed to inflate at 4.91% per annum (previous year – 4.90%). 9. Acquisition costs for insurance business Acquisition costs are those costs that vary with and are primarily related to the acquisition of insurance contracts and are expensed in the period in which they are incurred except for commission on long term motor insurance policies for new cars and new two wheelers sold on or after September 1, 2018. In case of long-term motor insurance policies for new cars and new two wheelers sold on or after September 1, 2018 commission is expensed at the applicable rates on the premium allocated for the year. 290 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 10.  Employee benefits Gratuity The Group pays gratuity, a defined benefit plan, to employees who retire or resign after a minimum prescribed period of continuous service and in case of employees at overseas locations as per the rules in force in the respective countries. The Group makes contribution to recognised trusts which administer the funds on their own account or through insurance companies. Actuarial valuation of the gratuity liability is determined by an independent actuary appointed by the Group. Actuarial valuation of gratuity liability is determined based on certain assumptions regarding rate of interest, salary growth, mortality and staff attrition as per the projected unit credit method. The actuarial gains or losses arising during the year are recognised in the profit and loss account. Superannuation Fund and National Pension Scheme The Bank has a superannuation fund, a defined contribution plan, which is administered by trustees and managed by insurance companies. The Bank contributes maximum 15.0% of the total annual basic salary for certain employees to superannuation funds. ICICI Prudential Life Insurance Company Limited, ICICI Prudential Asset Management Company Limited, ICICI Home Finance Company Limited, ICICI Venture Funds Management Company Limited and ICICI Investment Management Company Limited have accrued for superannuation liability based on a percentage of basic salary payable to eligible employees for the period of service. The Group contributes upto 10.0% of the total basic salary of certain employees to National Pension Scheme (NPS), a defined contribution plan, which is managed and administered by pension fund management companies. The employees are given an option to receive the amount in cash in lieu of such contributions along with their monthly salary during their employment. The amounts so contributed/paid by the Group to the superannuation fund and NPS or to employees during the year are recognised in the profit and loss account. The Group has no liability towards future benefits under superannuation fund and national pension scheme other than its annual contribution. Pension The Bank provides for pension, a defined benefit plan covering eligible employees of erstwhile Bank of Madura, erstwhile Sangli Bank and erstwhile Bank of Rajasthan. The Bank makes contribution to a trust which administers the funds on its own account or through insurance companies. The plan provides for pension payment including dearness relief on a monthly basis to these employees on their retirement based on the respective employee’s years of service with the Bank and applicable salary. Actuarial valuation of the pension liability is determined by an independent actuary appointed by the Bank. Actuarial valuation of pension liability is calculated based on certain assumptions regarding rate of interest, salary growth, mortality and staff attrition as per the projected unit credit method. The actuarial gains or losses arising during the year are recognised in the profit and loss account. Employees covered by the pension plan are not eligible for employer’s contribution under the provident fund plan. Provident fund The Group is statutorily required to maintain a provident fund, a defined benefit plan, as a part of retirement benefits to its employees. Each employee contributes a certain percentage of his or her basic salary and the Group contributes an equal amount for eligible employees. The Group makes contribution as required by The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 to Employees’ Pension Scheme administered by the Regional Provident Fund Commissioner and the balance contributions are transferred to funds administered by trustees. The funds are invested according to the rules prescribed by the Government of India. The Group recognises such contribution as an expense in the year in which it is incurred. Annual Report 2023-24 | 291 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Interest payable on provident fund should not be lower than the statutory rate of interest declared by the Central Government under the Employees Provident Funds and Miscellaneous Provisions Act, 1952. Actuarial valuation for the interest obligation on the provident fund balances is determined by an actuary appointed by the Group. The actuarial gains or losses arising during the year are recognised in the profit and loss account. The overseas branches of the Bank and its eligible employees contribute a certain percentage of their salary towards respective government schemes as per local regulatory guidelines. The contribution made by the overseas branches is recognised in profit and loss account at the time of contribution. Compensated absences The Group provides for compensated absences based on actuarial valuation conducted by an independent actuary. 11. Provisions, contingent liabilities and contingent assets The Group estimates the probability of any loss that might be incurred on outcome of contingencies on the basis of information available upto the date on which the consolidated financial statements are prepared. A provision is recognised when an enterprise has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are determined based on management estimates of amounts required to settle the obligation at the balance sheet date, supplemented by experience of similar transactions. These are reviewed at each balance sheet date and adjusted to reflect the current management estimates. In cases where the available information indicates that the loss on the contingency is reasonably possible but the amount of loss cannot be reasonably estimated, a disclosure to this effect is made in the consolidated financial statements. In case of remote possibility, neither provision nor disclosure is made in the consolidated financial statements. The Group does not account for or disclose contingent assets, if any. The Bank estimates the probability of redemption of customer loyalty reward points using an actuarial method by employing an independent actuary and accordingly makes provision for these reward points. Actuarial valuation is determined based on certain assumptions regarding mortality rate, discount rate, cancellation rate and redemption rate. 12. Cash and cash equivalents Cash and cash equivalents include cash in hand, foreign currency notes, balances with RBI, balances with other banks and money at call and short notice. 13. Investments i) Investments of the Bank are accounted for in accordance with the extant RBI guidelines on classification, valuation and operation of investment portfolio by Banks. a. The Bank follows trade date method of accounting for purchase and sale of investments, except for government of India and state government securities where settlement date method of accounting is followed in accordance with RBI guidelines. b. All investments are classified into ‘Held to Maturity’ (HTM), ‘Available for Sale’ (AFS) and ‘Held for Trading’ (HFT) on the date of purchase as per the extant RBI guidelines on classification, valuation and operation of investment portfolio by Banks. Reclassifications, if any, in any category are accounted for as per the RBI guidelines. Under each classification, the investments are further categorised as (a) government securities, (b) other approved securities, (c) shares, (d) bonds and debentures and (e) others. c. Investments that are held principally for resale within 90 days from the date of purchase are classified as HFT securities. Investments which the Bank intends to hold till maturity are classified as HTM securities. Investments which are not classified in either of the above categories are classified under AFS securities. 292 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED d. Costs including brokerage and commission pertaining to trading book investments paid at the time of acquisition and broken period interest (the amount of interest from the previous interest payment date till the date of purchase of instruments) on debt instruments are charged to the profit and loss account. e. Securities are valued scrip-wise. Depreciation/appreciation on securities, other than those acquired by way of conversion of outstanding loans, is aggregated for each category. Net appreciation in each category under each investment classification, if any, being unrealised, is ignored, while net depreciation is provided. The depreciation on securities acquired by way of conversion of outstanding loans is fully provided. Non- performing investments are identified based on the RBI guidelines. f. HTM securities are carried at their acquisition cost or at amortised cost, if acquired at a premium over the face value. Any premium over the face value of fixed rate and floating rate securities acquired is amortised over the remaining period to maturity on a constant yield basis and straight-line basis respectively. g. AFS and HFT securities are valued periodically as per RBI guidelines. Any premium over the face value of fixed rate and floating rate investments in government securities, classified as AFS, is amortised over the remaining period to maturity on constant yield basis and straight-line basis respectively. Quoted investments are valued based on the closing quotes on the recognised stock exchanges or prices declared by Primary Dealers Association of India (PDAI) jointly with Fixed Income Money Market and Derivatives Association (FIMMDA)/Financial Benchmark India Private Limited (FBIL), periodically. h. The market/fair value of unquoted government securities which are in the nature of Statutory Liquidity Ratio (SLR) securities included in the ‘AFS’ and ‘HFT’ categories is as per the rates published by FBIL and for unquoted corporate bonds, security level valuation (SLV) published by FIMMDA. The valuation of other unquoted fixed income securities, including Pass Through Certificates, wherever linked to the Yield-to- Maturity (YTM) rates, is computed with a mark-up (reflecting associated credit risk) over the YTM rates for government securities published by FIMMDA. The sovereign foreign securities and non-INR India linked bonds are valued on the basis of prices published by the sovereign regulator or counterparty quotes. i. Treasury bills, commercial papers and certificate of deposits being discounted instruments, are valued at carrying cost. j. The units of mutual funds are valued at the latest repurchase price/net asset value declared by the mutual fund. Unquoted equity shares are valued at the break-up value, if the latest balance sheet is available, or at `1, as per RBI guidelines. k. Investments in units of Venture Capital Funds (VCFs)/Alternative Investment Funds (AIFs) are categorised under HTM category for an initial period of three years and valued at cost. The units of VCFs/AIFs categorised under AFS are valued at the net asset value (NAV) declared by the VCFs/AIFs respectively. If the latest NAV is not available continuously for more than 18 months, the units of VCFs/AIFs are valued at ` 1, as per RBI guidelines. l. The units of Infrastructure Investment Trust (InvIT) are valued as per the quoted price available on the exchange. m. At the end of each reporting period, security receipts issued by the asset reconstruction companies are valued in accordance with the guidelines applicable to such instruments, prescribed by RBI from time to time. Accordingly, in cases where the cash flows from security receipts issued by the asset reconstruction companies are limited to the actual realisation of the financial assets assigned to the instruments in the concerned scheme, the Bank reckons the net asset value obtained from the asset reconstruction company from time to time, for valuation of such investments at each reporting period end. The Bank makes additional provisions on the security receipts based on the remaining period to end. The security receipts which are outstanding and not redeemed as at the end of the resolution period are treated as loss assets and are fully provided. Annual Report 2023-24 | 293 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED n. Depreciation/provision on non-performing investments is made as per internal provisioning norms, subject to minimum provisioning requirements of RBI. o. Gain/loss on sale of investments is recognised in the profit and loss account. Cost of investments is computed based on the First-In-First-Out (FIFO) method. The profit from sale of investment under HTM category, net of taxes and transfer to statutory reserve is transferred to “Capital Reserve” in accordance with the RBI guidelines. p. The Bank undertakes short sale transactions in dated central government securities in accordance with RBI guidelines. The short positions are categorised under HFT category and are marked-to-market. The mark-to-market loss is charged to profit and loss account and gain, if any, is ignored as per RBI guidelines. q. Market repurchase, reverse repurchase and transactions with RBI under Liquidity Adjustment Facility (LAF)/ Marginal Standing Facility (MSF) are accounted for as borrowing and lending transactions in accordance with the extant RBI guidelines. ii) The Bank’s consolidating venture capital fund carries investments at fair values, with unrealised gains and temporary losses on investments recognised as components of investors’ equity and accounted for in the unrealised investment reserve account. The realised gains and losses on investments and units in mutual funds and unrealised gains or losses on revaluation of units in mutual funds are accounted for in the profit and loss account. Provisions are made in respect of accrued income considered doubtful. Such provisions as well as any subsequent recoveries are recorded through the profit and loss account. Subscription to/purchase of investments are accounted at the cost of acquisition inclusive of brokerage, commission and stamp duty. iii) The Bank’s primary dealership and securities broking subsidiaries classify the securities held with the intention of holding for short-term and trading as stock-in-trade which are valued at lower of cost or market value. The securities classified by primary dealership subsidiary as held-to-maturity, as permitted by RBI, are carried at amortised cost. Appropriate provision is made for other than temporary diminution in the value of investments. Commission earned in respect of securities acquired upon devolvement is reduced from the cost of acquisition. iv) The Bank’s housing finance subsidiary classifies its investments as current investments and long-term investments. Investments that are readily realisable and intended to be held for not more than a year are classified as current investments, which are carried at the lower of cost and net realisable value. All other investments are classified as long-term investments, which are carried at their acquisition cost or at amortised cost, if acquired at a premium over the face value. Any premium over the face value of the securities acquired is amortised over the remaining period to maturity on a constant yield basis. However, a provision for diminution in value is made to recognise any other than temporary decline in the value of such long-term investments. v) The Bank’s overseas banking subsidiaries account for unrealised gain/loss, net of tax, on investment in ‘AFS’/‘Fair Value Through Other Comprehensive Income’ (FVOCI) category directly in their reserves. Further unrealised gain/loss on investment in ‘HFT’/‘Fair Value Through Profit and Loss’ (FVTPL) category is accounted directly in the profit and loss account. Investments in ‘HTM’/‘amortised cost’ category are carried at amortised cost. vi) In the case of life and general insurance businesses, investments are made in accordance with the Insurance Act, 1938 (amended by the Insurance Laws (Amendment) Act, 2015), the IRDA (Investment) Regulations, 2016 and various other circulars/notifications issued by the IRDAI in this context from time to time. In the case of life insurance business, valuation of investments (other than linked business) is done on the following basis: a. All debt securities including government securities and redeemable preference shares are considered as ‘held to maturity’ and stated at historical cost, subject to amortisation of premium or accretion of discount over the period of maturity/holding on a constant yield basis. b. Listed equity shares and equity exchange traded funds (ETF) are stated at fair value being the last quoted closing price on the National Stock Exchange (NSE) (or BSE, in case the investments are not listed on NSE). 294 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Unlisted equity shares are stated at acquisition cost less impairment, if any. Equity shares lent under the Securities Lending and Borrowing scheme (SLB) continue to be recognised in the Balance Sheet as the Company retains all the associated risks and rewards of these securities. Non-traded and thinly traded equity share are valued at last available price on NSE/BSE or the value derived using valuation principle of net worth per share, whichever is lower. c. Mutual fund units are valued based on the previous day’s net asset value. Unrealised gains/losses arising due to changes in the fair value of listed equity shares and mutual fund units are taken to ‘Revenue and other reserves’ and ‘Liabilities on policies in force’ in the balance sheet for Shareholders’ fund and Policyholders’ fund respectively for life insurance business. In the case of general insurance business, valuation of investments is done on the following basis: a. All debt securities including government securities, money market instruments, non-convertible and redeemable preference shares and excluding Additional Tier-1 perpetual bonds are considered as ‘held to maturity’ and accordingly stated at amortised cost determined after amortisation of premium or accretion of discount over the holding/maturity period in accordance with income recognition policy. Additional Tier-1 perpetual bonds Additional Tier-1 perpetual bond investments are valued at fair value using market yield rates published by rating agency registered with the Securities and Exchange Board of India (SEBI). b. Listed equities and convertible preference shares at the balance sheet date are stated at fair value, being the last quoted closing price on the NSE and in case these are not listed on NSE, then based on the last quoted closing price on the BSE. c. Mutual fund investments (other than venture capital fund) are stated at fair value, being the closing net asset value at balance sheet date. d. Investments other than mentioned above are valued at cost. Unrealised gains/losses arising due to changes in the fair value of listed equity shares, convertible preference shares and mutual fund investments and Additional Tier-I perpetual bonds are taken to ‘Revenue and other reserves’ in the balance sheet for general insurance business. Insurance subsidiaries assess at each balance sheet date whether there is any indication that any investment may be impaired. If any such indication exists, the carrying value of such investment is reduced to its recoverable amount and the impairment loss is recognised in the revenue(s)/profit and loss account. The previously impaired loss is also reversed on disposal/realisation of securities and results thereon are recognised. The total proportion of investments for which subsidiaries have applied accounting policies different from the Bank as mentioned above, is approximately 25.57% of the total investments at March 31, 2024. 14. Loans and other credit facilities i) Loans and other credit facilities of the Bank are accounted for in accordance with the extant RBI guidelines as given below: The Bank classifies its loans and investments, including at overseas branches and overdues arising from crystallised derivative contracts, into performing and NPAs in accordance with RBI guidelines. Loans and advances held at the overseas branches that are identified as impaired as per host country regulations but which are standard as per the extant RBI guidelines, are classified as NPAs to the extent of amount outstanding in the respective host country. Further, NPAs are classified into sub-standard, doubtful and loss assets based on the criteria stipulated by RBI. Interest on non-performing advances is transferred to an interest suspense account and not recognised in profit and loss account until received. Annual Report 2023-24 | 295 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The Bank considers an account as restructured, where for economic or legal reasons relating to the borrower’s financial difficulty, the Bank grants concessions to the borrower, that the Bank would not otherwise consider. The moratorium granted to the borrowers based on RBI guidelines is not accounted as restructuring of loan. Certain specified guidelines by RBI requires the asset classification to be maintained as ‘Standard’. Therefore, the borrowers where resolution plan was implemented under these guidelines are classified as standard restructured. In the case of corporate loans and advances, provisions are made for sub-standard and doubtful assets as per internal provisioning norms, subject to minimum provisioning requirements of RBI. Loss assets and the unsecured portion of doubtful assets are fully provided. For impaired loans and advances held in overseas branches, which are performing as per RBI guidelines, provisions are made as per the host country regulations. For loans and advances held in overseas branches, which are NPAs both as per RBI guidelines and host country guidelines, provisions are made at the higher of the provisions required as per internal provisioning norms and host country regulations. Provisions on homogeneous non-performing retail loans and advances, subject to minimum provisioning requirements of RBI, are made on the basis of the ageing of the loan. The specific provisions on non-performing retail loans and advances held by the Bank are higher than the minimum regulatory requirements. In respect of non-retail loans reported as fraud to RBI, the entire amount is provided over a period not exceeding four quarters starting from the quarter in which fraud has been detected. In respect of non-retail loans where there has been delay in reporting the fraud to the RBI or which are classified as loss accounts, the entire amount is provided immediately. In case of fraud in retail accounts, the entire amount is provided immediately. In respect of borrowers classified as non-cooperative borrowers or willful defaulters, the Bank makes accelerated provisions as per RBI guidelines. The Bank holds specific provisions against non-performing loans and advances, and against certain performing loans and advances in accordance with RBI directions. The Bank makes provision on restructured loans subject to minimum requirements as per RBI guidelines. Provision due to diminution in the fair value of restructured/rescheduled loans and advances is made in accordance with the applicable RBI guidelines. Non-performing and restructured loans are upgraded to standard as per the extant RBI guidelines or host country regulations, as applicable. In terms of RBI guideline, the NPAs are written-off in accordance with the Bank’s policy. Amounts recovered against bad debts written-off are recognised in the profit and loss account. The Bank maintains general provision on performing loans and advances in accordance with the RBI guidelines, including provisions on loans to borrowers having unhedged foreign currency exposure, provisions on loans to specific borrowers in specific stressed sector, provision on exposures to step-down subsidiaries of Indian companies and provision on incremental exposure to borrowers identified as per RBI’s large exposure framework. For performing loans and advances in overseas branches, the general provision is made at higher of aggregate provision required as per host country regulations and RBI requirement. In addition to the provisions required to be held according to the asset classification status, provisions are held for individual country exposures including indirect country risk (other than for home country exposure). The countries are categorised into seven risk categories namely insignificant, low, moderately low, moderate, moderately high, high and very high, and provisioning is made on exposures exceeding 180 days on a graded scale ranging from 0.25% to 25%. For exposures with contractual maturity of less than 180 days, provision is required to be held at 25% of the rates applicable to exposures exceeding 180 days. The indirect exposure is reckoned at 50% of the exposure. If the country exposure (net) of the Bank in respect of each country does not exceed 1% of the total funded assets, no provision is required on such country exposure. The Bank makes additional provisions as per RBI guidelines for the cases where viable resolution plan has 296 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED not been implemented within the timelines prescribed by the RBI from the date of default. These additional provisions are written-back on satisfying the conditions for reversal as per RBI guidelines. The Bank, on prudent basis, has made contingency provision on certain loan portfolios, including borrowers who had taken moratorium at any time during FY2021 under the extant RBI guidelines related to Covid-19 regulatory package. The Bank also makes additional contingency provision on certain standard assets. The contingency provision is included in ‘Schedule 5 - Other Liabilities and Provisions’. The Bank has a Board approved policy for making floating provision, which is in addition to the specific and general provisions made by the Bank. The floating provision is utilised, with the approval of Board and RBI, in case of contingencies which do not arise in the normal course of business and are exceptional and non- recurring in nature and for making specific provision for impaired loans as per the requirement of extant RBI guidelines or any regulatory guidance/instructions. The floating provision is netted-off from advances. ii) In the case of the Bank’s housing finance subsidiary, loans and other credit facilities are classified as per the Master Directions – Non Banking Financial Company – Housing Finance Companies (Reserve Bank) Directions, 2021 issued by Reserve Bank of India (‘Master Direction’). Further, NPAs are classified into sub-standard, doubtful and loss assets based on criteria stipulated in the Master Direction. Additional provisions are made against specific non-performing assets over and above what is stated above, if in the opinion of management, increased provisions are necessary. General provision on restructured loans is made as per RBI guidelines. iii) In the case of the Bank’s UK subsidiary, loans are stated net of allowance for credit losses. Loans are classified as impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition on the loan (a loss event) and that loss event (or events) has an impact on the estimated future cash flows of the loans that can be reliably estimated. An allowance for impairment losses is maintained at a level that management considers adequate to absorb identified credit related losses as well as losses that have occurred but have not yet been identified. iv) The Bank’s Canadian subsidiary measures impairment loss on all financial assets using expected credit loss (ECL) model based on a three-stage approach. The ECL for financial assets that are not credit-impaired and for which there is no significant increase in credit risk since origination, is computed using 12-month probability of default (PD) and represents the lifetime cash shortfalls that will result if a default occurs in next 12 months. The ECL for financial assets, that are not credit-impaired but have experienced a significant increase in credit risk since origination, is computed using a life time PD, and represents lifetime cash shortfalls that will result if a default occurs during the expected life of financial assets. A financial asset is considered credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred. The allowance for credit losses for impaired financial assets is computed based on individual assessment of expected cash flows from such assets. The total proportion of loans for which subsidiaries have applied accounting policies different from the Bank as mentioned above, is approximately 6.08% of the total loans at March 31, 2024. 15. Transfer and servicing of assets The Bank transfers commercial and consumer loans through securitisation transactions. The transferred loans are de-recognised and gains/losses are accounted, only if the Bank surrenders the rights to benefits specified in the underlying securitised loan contract. Recourse and servicing obligations are accounted for net of provisions. In accordance with the RBI guidelines for securitisation of standard assets, with effect from February 1, 2006, the profit/premium arising from securitisation is amortised over the life of the securities issued or to be issued by the special purpose vehicle to which the assets are sold. With effect from May 7, 2012, the RBI guidelines require the profit/premium arising from securitisation to be amortised based on the method prescribed in the guidelines. As per the RBI guidelines issued on September 24, 2021, gain realised at the time of securitisation of loans is accounted through profit and loss account on completion of transaction. The Bank accounts for any loss arising from securitisation immediately at the time of sale. Annual Report 2023-24 | 297 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The unrealised gains, associated with expected future margin income is recognised in profit and loss account on receipt of cash, after absorbing losses, if any. Net income arising from sale of loan assets through direct assignment with recourse obligation is amortised over the life of underlying assets sold and net income from sale of loan assets through direct assignment, without any recourse obligation, is recognised at the time of sale. Net loss arising on account of direct assignment of loan assets is recognised at the time of sale. As per the RBI guidelines issued on September 24, 2021, any loss or realised gain from sale of loan assets through direct assignment is accounted through profit and loss account on completion of transaction. The acquired loans is carried at acquisition cost. In case premium is paid on a loan acquired, premium is amortised over the loan tenure. In accordance with RBI guidelines, in case of non-performing loans sold to Asset Reconstruction Companies (ARCs), the Bank reverses the excess provision in profit and loss account in the year in which amounts are received. Any shortfall of sale value over the net book value on sale of such assets is recognised by the Bank in the year in which the loan is sold. The Canadian subsidiary has entered into securitisation arrangements in respect of its originated and purchased mortgages. ICICI Bank Canada either retains substantially all the risk and rewards or retains control over these mortgages, hence these arrangements do not qualify for de-recognition accounting under their local accounting standards. It continues to recognise the mortgages securitised as “Loans and Advances” and the amounts received through securitisation are recognised as “Other borrowings”. 16. Fixed assets (Property, Plant and Equipment) Fixed assets, other than premises of the Bank and its housing finance subsidiary are carried at cost less accumulated depreciation and impairment, if any. In case of the Bank and its housing finance subsidiary, premises are carried at revalued amount, being fair value at the date of revaluation less accumulated depreciation. Cost includes freight, duties, taxes and incidental expenses related to the acquisition and installation of the asset. Depreciation is charged over the estimated useful life of fixed assets on a straight-line basis. The useful life of the groups of fixed assets for domestic group companies is based on past experience and expectation of usage, which for some categories of fixed assets, is different from the useful life as prescribed in Schedule II to the Companies Act, 2013. Assets purchased/sold during the year are depreciated on a pro-rata basis for the actual number of days the asset has been capitalised. The Group assets individually costing up to ` 5,000/- are depreciated fully in the year of acquisition. Further, profit on sale of premises by the Bank is appropriated to capital reserve, net of transfer to Statutory Reserve and taxes, in accordance with RBI guidelines. In case of revalued/impaired assets, depreciation is provided over the remaining useful life of the assets with reference to revised asset values. In case of premises, which are carried at revalued amounts, the depreciation on the excess of revalued amount over historical cost is transferred from Revaluation Reserve to General Reserve annually. Non-banking assets Non-banking assets (NBAs) acquired in satisfaction of claims are valued at the market value on a distress sale basis or value of loan, whichever is lower. Further, the Bank creates provision on these assets as per the extant RBI guidelines or specific RBI directions. 17. Foreign exchange and derivative contracts Derivative transactions comprises of forward contracts, futures, swaps and options. The Group undertakes derivative transactions for trading and hedging balance sheet assets and liabilities. 298 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The forward exchange contracts that are not intended for trading and are entered into to establish the amount of reporting currency required or available at the settlement date of a transaction are effectively valued at closing spot rate. The premium or discount arising on inception of such forward exchange contracts is amortised over the life of the contract as interest income/expense. All other outstanding forward exchange contracts are revalued based on the exchange rates notified by FEDAI for specified maturities and at interpolated rates for contracts of interim maturities. The contracts of longer maturities where exchange rates are not notified by FEDAI are revalued based on the forward exchange rates implied by the swap curves in respective currencies. The resultant gains or losses are recognised in the profit and loss account. The swap contracts entered to hedge on-balance sheet assets and liabilities are structured such that they bear an opposite and offsetting impact with the underlying on-balance sheet items. The impact of such derivative instruments is correlated with the movement of underlying assets and liabilities and accounted pursuant to the principles of hedge accounting. The Group identifies the hedged item (asset or liability) at the inception of the transaction itself. Hedge effectiveness is ascertained at the time of the inception of the hedge and periodically thereafter. Based on RBI circular issued on June 26, 2019, the accounting of hedge relationships established after June 26, 2019 is in accordance with the Guidance note on Accounting for Derivative Contracts issued by ICAI. The swaps under hedge relationships established prior to that date are accounted for on an accrual basis and are not marked to market unless their underlying transaction is marked-to-market. Gains or losses arising from hedge ineffectiveness, if any, are recognised in the profit and loss account except in the case of the Bank’s overseas banking subsidiaries. In overseas subsidiaries, in case of fair value hedge, the hedging transactions and the hedged items (for the risks being hedged) are measured at fair value with changes recognised in the profit and loss account and in case of cash flow hedges, changes in the fair value of effective portion of the cash flow hedge are taken to ‘Revenue and other reserves’ and ineffective portion, if any, are recognised in the profit and loss account. The derivative contracts entered into for trading purposes are marked to market and the resulting gain or loss is accounted for in the profit and loss account. Marked-to-market values of such derivatives are classified as assets when the fair value is positive or as liabilities when the fair value is negative. Premium for Foreign currency/Indian rupees option transaction is recognised as income/expense on expiry or early termination of the transaction. Mark to market gain/loss (adjusted for premium received/paid on options contracts) is recorded in the profit and loss account. The gain or loss arising on unwinding or termination of the contracts, is accounted for in the Profit and Loss account. Currency futures contracts are marked to market using daily settlement price on a trading day, which is the closing price of the respective futures contracts on that day. Pursuant to RBI guidelines, any receivables under derivative contracts which remain overdue for more than 90 days and mark-to-market gains on other derivative contracts with the same counter-parties are reversed through the profit and loss account. 18. Impairment of assets The immovable fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An asset is treated as impaired when its carrying amount exceeds its recoverable amount. The impairment is recognised by debiting the profit and loss account and is measured as the amount by which the carrying amount of the impaired assets exceeds their recoverable value. The Bank and its housing finance subsidiary follows revaluation model of accounting for its premises and the recoverable amount of the revalued assets is considered to be close to its revalued amount. Accordingly, separate assessment for impairment of premises is not required. For assets other than premises, the Group assesses at each balance sheet date whether there is any indication that an asset may be impaired. Impairment loss, if any, is provided in the profit and loss account to the extent the carrying amount of assets exceeds their estimated recoverable amount. Annual Report 2023-24 | 299 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 19. Lease transactions Lease payments including cost escalations for assets taken on operating lease are recognised as an expense in the profit and loss account over the lease term on straight line basis. The leases of property, plant and equipment, where substantially all of the risks and rewards of ownership are transferred to the Bank are classified as finance lease. Minimum lease payments under finance lease are apportioned between the finance costs and outstanding liability. 20. Earnings per share Basic earnings per share is calculated by dividing the net profit or loss after tax for the year attributable to equity shareholders by the weighted average number of equity shares outstanding for the year. Diluted earnings per share reflect the potential dilution that could occur if contracts to issue equity shares were exercised or converted during the year. Diluted earnings per equity share is computed using the weighted average number of equity shares and dilutive potential equity shares issued by the group outstanding during the year, except where the results are anti-dilutive. 21. Bullion transaction The Bank deals in bullion business on a consignment basis. The bullion is priced to the customers based on the price quoted by the supplier. The difference between price recovered from customers and cost of bullion is accounted for as commission at the time of sales to the customers. The Bank also deals in bullion on a borrowing and lending basis and the interest expense/income is accounted on accrual basis. 22. Share issue expenses Share issue expenses are deducted from Securities Premium Account in terms of Section 52 of the Companies Act, 2013. 23. Segment Reporting The disclosure related to segment information is in accordance with AS-17, Segment Reporting and as per guidelines issued by RBI. 300 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED SCHEDULE 18 NOTES FORMING PART OF THE ACCOUNTS The following additional disclosures have been made taking into account the requirements of Accounting Standards (ASs) and Reserve Bank of India (RBI) guidelines. 1. Earnings per share Basic and diluted earnings per equity share are computed in accordance with AS 20 - Earnings per share. Basic earnings per equity share is computed by dividing net profit/(loss) after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed using the weighted average number of equity shares and weighted average number of dilutive potential equity shares outstanding during the year. The following table sets forth, for the periods indicated, the computation of earnings per share. ` in million, except per share data Particulars Year ended March 31, 2024 Year ended March 31, 2023 Net profit/(loss) attributable to equity shareholders used in computation of Basic and Diluted EPS 442,563.7 340,366.4 Nominal value per share (`) 2.00 2.00 Basic earnings per share (`) 63.19 48.86 Effect of potential equity shares (`) (1.23) (1.02) Diluted earnings per share (`)1 61.96 47.84 Reconciliation between weighted shares used in computation of basic and diluted earnings per share Weighted average number of equity shares outstanding used in computation of Basic EPS 7,003,943,116 6,966,305,957 Add: Effect of potential equity shares 128,245,813 138,684,400 Weighted average number of equity shares outstanding used in computation of Diluted EPS 7,132,188,929 7,104,990,357 1. The dilutive impact is due to options granted to employees by the Group. 2. Related party transactions The Group has transactions with its related parties comprising associates/other related entities and key management personnel and relatives of key management personnel. I. Related parties Associates/other related entities Sr. no. Name of the entity Nature of relationship 1. ICICI Lombard General Insurance Company Limited Associate1 2. Arteria Technologies Private Limited Associate 3. India Advantage Fund-III Associate 4. India Advantage Fund-IV Associate 5. India Infradebt Limited Associate 6. ICICI Merchant Services Private Limited Associate 7. I-Process Services (India) Private Limited Associate2 8. NIIT Institute of Finance, Banking and Insurance Training Limited Associate 9. Comm Trade Services Limited Other related entity 10. ICICI Foundation for Inclusive Growth Other related entity 11. Cheryl Advisory Private Limited Other related entity 1. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. 2. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. Annual Report 2023-24 | 301 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Key management personnel Sr. no. Name of the Key management personnel Relatives of the Key management personnel 1. Mr. Sandeep Bakhshi • Ms. Mona Bakhshi • Mr. Shivam Bakhshi • Ms. Aishwarya Bakshi • Ms. Esha Bakhshi • Ms. Minal Bakhshi • Mr. Sameer Bakhshi • Mr. Ritwik Thakurta • Mr. Ashwin Pradhan • Ms. Radhika Bakhshi 2. Mr. Anup Bagchi (upto April 30, 2023) • Ms. Mitul Bagchi • Mr. Aditya Bagchi • Mr. Shishir Bagchi • Mr. Arun Bagchi 3. Mr. Sandeep Batra • Mr. Pranav Batra • Ms. Arushi Batra • Mr. Vivek Batra • Ms. Veena Batra 4. Mr. Rakesh Jha (w.e.f. September 2, 2022) • Mr. Narendra Kumar Jha • Mr. Navin Ahuja • Mr. Sharad Bansal • Ms. Aparna Ahuja • Ms. Apoorva Jha Bansal • Ms. Pushpa Jha • Ms. Sanjali Jha • Ms. Swati Jha 5. Ms. Vishakha Mulye (upto May 31, 2022) • Mr. Vivek Mulye • Ms. Vriddhi Mulye • Mr. Vighnesh Mulye • Dr. Gauresh Palekar • Ms. Shalaka Gadekar • Dr. Nivedita Palekar 6. Mr. Ajay Kumar Gupta (w.e.f. March 15, 2024) • Dr. Shabnam Gupta • Mr. Akhil Gupta • Mr. Aneesh Gupta • Mr. Ashok Gupta • Mr. Vinay Gupta • Ms. Aparna Gupta • Ms. Madhu Gupta • Ms. Rita Agarwal • Ms. Shanti Gupta • Shyam Lall Gupta HUF 302 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED II. Transactions with related parties The following table sets forth, for the periods indicated, the significant transactions between the Group and its related parties. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Interest income 380.2 438.0 Associates/others 379.3 434.8 Key management personnel 0.9 3.2 Income from services rendered 1,589.2 1,422.7 Associates/others 1,588.4 1,419.9 Key management personnel 0.6 0.9 Relatives of key management personnel 0.2 1.9 Gain/(loss) on forex and derivative transactions (net) 61.6 50.8 Associates/others 61.6 50.8 Income from shared services 243.4 326.5 Associates/others 243.4 326.5 Dividend income 2,582.9 2,347.1 Associates/others 2,582.9 2,347.1 Insurance claims received 40.1 163.0 Associates/others 40.1 163.0 Interest expense 218.0 225.7 Associates/others 193.8 205.2 Key management personnel 14.4 15.3 Relatives of key management personnel 9.8 5.2 Expenses for services received 13,043.6 15,702.6 Associates/others 13,043.6 15,702.6 Insurance premium paid 3,288.0 3,544.6 Associates/others 3,288.0 3,544.6 Expenses for shared services and other payments 5.0 0.8 Associates/others 5.0 0.8 Insurance claims, surrenders and annuities paid 44.1 19.0 Associates/others 43.6 18.5 Key management personnel 0.5 0.5 CSR related reimbursement of expenses 5,170.0 4,441.1 Associates/others 5,170.0 4,441.1 Donation given 712.3 564.5 Associates/others 712.3 564.5 Annual Report 2023-24 | 303 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Volume of fixed deposits placed 11,834.1 7,076.0 Associates/others 11,718.6 6,916.7 Key management personnel 84.9 133.5 Relatives of key management personnel 30.6 25.8 Purchase of investments 3,904.1 1,634.0 Associates/others 3,904.1 1,634.0 Sale of Investments 23,777.9 31,667.3 Associates/others 23,777.9 31,667.3 Investments in the securities issued by related parties 20,937.8 1,850.0 Associates/others 20,937.8 1,850.0 Issuance of securities to related parties - 1,000.0 Associates/others - 1,000.0 Redemption/buyback of Investments by related parties 2,500.0 1,615.5 Associates/others 2,500.0 1,615.5 Purchase of fixed assets 1.7 3.4 Associates/others 1.7 3.4 Forex/swaps/derivatives and forwards transactions entered (notional value) 6,939.8 6,619.8 Associates/others 6,939.8 6,619.8 Guarantees/letters of credit given by the Group 0.1 5.0 Associates/others 0.1 5.0 Insurance premium received 49.4 58.7 Associates/others 48.7 55.3 Key management personnel 0.3 2.6 Relatives of key management personnel 0.4 0.8 Remuneration to wholetime directors1 287.0 336.6 Key management personnel 287.0 336.6 Dividend paid 5.2 3.9 Key management personnel 4.3 3.2 Relatives of key management personnel 0.9 0.7 Value of ESOPs exercised 86.3 306.2 Key management personnel 86.3 306.2 Sale of fixed assets - 0.2 Key management personnel - 0.2 1. Excludes the perquisite value on employee stock options exercised and includes performance bonus paid during the period. 304 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED III. Material transactions with related parties The following table sets forth, for the periods indicated, the material transactions between the Group and its related parties. A specific related party transaction is disclosed as a material related party transaction wherever it exceeds 10% of all related party transactions in that category. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Interest income 1 India Infradebt Limited 365.5 421.2 Income from services rendered 1 ICICI Lombard General Insurance Company Limited 1,445.6 1,267.5 Gain/(loss) on forex and derivative transactions (net) 1 ICICI Lombard General Insurance Company Limited 61.6 50.8 Income from shared services 1 ICICI Lombard General Insurance Company Limited 169.6 262.0 2 I-Process Services (India) Private Limited 27.0 27.2 3 ICICI Foundation for Inclusive Growth 36.6 37.2 Dividend income 1 ICICI Lombard General Insurance Company Limited 2,476.4 2,240.5 Insurance claims received 1 ICICI Lombard General Insurance Company Limited 40.1 163.0 Interest expense 1 ICICI Lombard General Insurance Company Limited 116.5 140.5 2 ICICI Merchant Services Private Limited 17.9 25.9 Expenses for services received 1 I-Process Services (India) Private Limited 10,885.4 10,406.6 2 ICICI Merchant Services Private Limited 2,085.4 5,226.6 Insurance Premium paid 1 ICICI Lombard General Insurance Company Limited 3,288.0 3,544.6 Expenses for shared services and other payments 1 ICICI Lombard General Insurance Company Limited 5.0 0.8 Insurance claims, surrenders and annuities paid 1 ICICI Lombard General Insurance Company Limited 42.5 16.2 2 ICICI Foundation for Inclusive Growth 1.1 2.3 CSR related reimbursement of expenses 1 ICICI Foundation for Inclusive Growth 5,170.0 4,441.1 Donation given 1 ICICI Foundation for Inclusive Growth 712.3 564.5 Volume of fixed deposits placed 1 I-Process Services (India) Private Limited 5,952.9 4,548.7 2 ICICI Merchant Services Private Limited 5,330.0 2,000.0 Purchase of investments 1 ICICI Lombard General Insurance Company Limited 3,904.1 1,634.0 Sale of Investments 1 ICICI Lombard General Insurance Company Limited 16,160.8 24,647.6 2 India Infradebt Limited 7,617.1 7,019.7 Annual Report 2023-24 | 305 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Investments in the securities issued by related parties 1 India Infradebt Limited 20,937.8 1,850.0 Issuance of securities to related parties 1 ICICI Lombard General Insurance Company Limited - 1,000.0 Redemption/buyback of investments by related parties 1 India Infradebt Limited 2,500.0 - 2 ICICI Lombard General Insurance Company Limited - 1,615.5 Purchase of fixed assets 1 Arteria Technologies Private Limited 1.7 3.2 Forex/swaps/derivatives and forwards transactions entered (notional value) 1 ICICI Lombard General Insurance Company Limited 6,289.9 5,933.3 Guarantees/letters of credit given by the Group 1 NIIT Institute of Finance, Banking and Insurance Training Limited 0.1 2.3 2 Arteria Technologies Private Limited - 2.7 Insurance premium received 1 ICICI Lombard General Insurance Company Limited 47.2 54.1 Remuneration to wholetime directors 1 Mr. Sandeep Bakhshi 99.7 95.7 2 Mr. Sandeep Batra 86.7 85.3 3 Mr. Rakesh Jha 84.0 45.9 4 Mr. Anup Bagchi 13.7 86.5 5 Mr. Ajay Kumar Gupta 2.9 N.A. 6 Ms. Vishakha Mulye N.A. 23.2 Dividend paid 1 Mr. Sandeep Bakhshi 2.2 1.8 2 Mr. Sandeep Batra 1.4 0.6 3 Mr. Rakesh Jha 0.7 0.7 4 Mr. Anup Bagchi - 0.0 5 Mr. Shivam Bakhshi 0.3 0.4 Value of ESOPs exercised 1 Mr. Sandeep Bakhshi 34.5 27.2 2 Mr. Sandeep Batra 13.3 22.0 3 Mr. Rakesh Jha 38.5 - 4 Mr. Anup Bagchi - 183.2 5 Ms. Vishakha Mulye N.A. 73.8 Sale of fixed assets 1 Mr. Rakesh Jha - 0.1 2 Ms. Vishakha Mulye N.A. 0.1 1. 0.0 represents insignificant amount. 306 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED IV. Related party outstanding balances The following table sets forth, for the periods indicated, the outstanding balances payable to/receivable from related parties. ` in million Items At March 31, 2024 At March 31, 2023 Deposits accepted 2,518.0 2,960.0 Associates/others 2,023.1 2,603.0 Key management personnel 350.8 260.7 Relatives of key management personnel 144.1 96.3 Payables 3,159.4 3,718.3 Associates/others 3,158.4 3,716.9 Key management personnel 0.2 0.4 Relatives of key management personnel 0.8 1.0 Investments of the Group 11,736.7 24,863.5 Associates/others 11,736.7 24,863.5 Investments of related parties in the Group 8.5 1,601.3 Associates/others - 1,600.0 Key management personnel 2.5 1.1 Relatives of key management personnel 6.0 0.2 Advances by the Group 192.6 277.4 Associates/others 123.0 191.3 Key management personnel 68.8 85.7 Relatives of key management personnel 0.8 0.4 Receivables 238.6 1,538.9 Associates/others 238.6 1,538.9 Relatives of key management personnel 0.0 - Guarantees issued by the Group 60.2 63.1 Associates/others 60.2 63.1 1. 0.0 represents insignificant amount. V. Related party maximum balances The following table sets forth, for the periods indicated, the maximum balances payable to/receivable from related parties. ` in million Items Year ended March 31, 2024 Year ended March 31, 2023 Deposits accepted Key management personnel 351.2 420.7 Relatives of key management personnel 144.1 266.6 Payables2 Key management personnel 1.5 0.4 Relatives of key management personnel 0.9 1.0 Investments of related parties in the Group2 Key management personnel 2.5 1.9 Relatives of key management personnel 6.0 0.3 Advances by the Group Key management personnel 85.7 139.2 Relatives of key management personnel 2.5 2.3 Receivables2 Relatives of key management personnel 0.0 - 1. 0.0 represents insignificant amount. 2. Maximum balance is determined based on comparison of the total outstanding balances at each quarter end during the financial year. Annual Report 2023-24 | 307 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 3. Employee Stock Option Scheme (ESOS)/Employees Stock Unit Scheme - 2022 (ESUS 2022) ICICI Bank: In terms of the ESOS, as amended, the maximum number of options granted to any eligible employee in a financial year shall not exceed 0.05% of the issued equity shares of the Bank at the time of grant of the options and aggregate of all such options granted to the eligible employees shall not exceed 10.0% of the aggregate number of the issued equity shares of the Bank on the date(s) of the grant of options in line with SEBI regulations. Under the stock option scheme, eligible employees are entitled to apply for equity shares. In April 2016, exercise period was modified from 10 years from the date of grant or five years from the date of vesting, whichever is later, to 10 years from the date of vesting. In June 2017, exercise period was further modified to not exceed 10 years from the date of vesting of options as may be determined by the Board Governance, Remuneration & Nomination Committee to be applicable for future grants. In May 2018, exercise period was further modified to not exceed five years from the date of vesting of options as may be determined by the Board Governance, Remuneration & Nomination Committee to be applicable for future grants. Options granted after March 2014 vest in a graded manner over a three-year period with 30%, 30% and 40% of the grant vesting in each year, commencing from the end of 12 months from the date of grant other than certain options granted in April 2014 which vested to the extent of 50% on April 30, 2017 and the balance on April 30, 2018 and option granted in September 2015 which vested to the extent of 50% on April 30, 2018 and balance 50% vested on April 30, 2019. Options granted in January 2018 vested at the end of four years from the date of grant. Certain options granted on May 2018, vested to the extent of 50% on May 2021 and balance 50% on May 2022. Options granted prior to March 2014 except mentioned below, vested in a graded manner over a four-year period, with 20%, 20%, 30% and 30% of the grants vesting in each year, commencing from the end of 12 months from the date of grant. Options granted in April 2009 vested in a graded manner over a five-year period with 20%, 20%, 30% and 30% of grant vesting each year, commencing from the end of 24 months from the date of grant. Options granted in September 2011 vested in a graded manner over a five-year period with 15%, 20%, 20% and 45% of grant vesting each year, commencing from the end of 24 months from the date of the grant. The exercise price of the Bank’s options, except mentioned below, is the last closing price on the stock exchange, which recorded highest trading volume preceding the date of grant of options. In February 2011, the Bank granted 16,692,500 options to eligible employees and whole-time Directors of the Bank and certain of its subsidiaries at an exercise price of ` 175.82. This exercise price was the average closing price on the stock exchange during the six months ended October 28, 2010. Of these options granted, 50% vested on April 30, 2014 and the balance 50% vested on April 30, 2015. The Board of Directors of the Bank at its Meeting held on June 28, 2022, approved the adoption of Employees Stock Unit Scheme - 2022 (Scheme 2022), which was subsequently approved by the shareholders at the Annual General Meeting held on August 30, 2022. As per the Scheme, maximum of 100,000,000 Units, shall be granted in one or more tranches over a period of seven years from the date of approval of the Scheme 2022 by the shareholders. The maximum number of Units granted to any eligible employee shall not exceed 20,000 units in any financial year and 0.14% of the total units available for grant over a period of seven years from the date of approval of the Unit Scheme by the shareholders. Units granted under the Scheme 2022 shall vest not later than the maximum vesting period of four years. Exercise price shall be the face value of equity shares of the Bank i.e. ` 2 for each unit (as adjusted for any changes in capital structure of the Bank). Units granted under the scheme vest in a graded manner over a three-year period with 30%, 30% and 40% of the grant vesting in each year, commencing from the end of 13 months from the date of grant. Exercise period of units is five years from the date of vesting, or such shorter period as may be determined by the Board Governance, Remuneration & Nomination Committee for each grant. The weighted average fair value, based on Black-Scholes model, of options granted during the year ended March 31, 2024 was ` 340.59 (year ended March 31, 2023: ` 291.15) and of units granted during the year ended March 31, 2024 was ` 879.43. 308 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The following table sets forth, for the periods indicated, the key assumptions used to estimate the fair value of options granted. Particulars Year ended March 31, 2024 Year ended March 31, 2023 Risk-free interest rate 6.88% to 7.32% 5.99% to 7.37% Expected term 3.23 to 5.23 years 3.23 to 5.23 years Expected volatility 24.78% to 37.41% 34.79% to 38.98% Expected dividend yield 0.56% to 0.85% 0.27% to 0.72% The following table sets forth, for the periods indicated, the key assumptions used to estimate the fair value of units granted. Particulars Year ended March 31, 2024 Risk-free interest rate 6.82% to 6.94% Expected term 1.58 to 3.58 years Expected volatility 23.63% to 36.56% Expected dividend yield 0.56% Risk free interest rates over the expected term of the option/units are based on the government securities yield in effect at the time of the grant. The expected term of an option/units is estimated based on the vesting term as well as expected exercise behavior of the employees who receive the option/units. Expected exercise behavior is estimated based on the historical stock option exercise pattern of the Bank. Expected volatility during the estimated expected term of the option/units is based on historical volatility determined based on observed market prices of the Bank's publicly traded equity shares. Expected dividends during the estimated expected term of the option/units are based on recent dividend activity. The following table sets forth, for the periods indicated, the summary of the status of the Bank’s stock option plan. ` except number of options Particulars Stock options outstanding Year ended March 31, 2024 Year ended March 31, 2023 Number of options Weighted average exercise price Number of options Weighted average exercise price Outstanding at the beginning of the year 225,025,803 361.60 237,197,999 310.82 Add: Granted during the year 14,635,600 894.95 25,793,500 747.92 Less: Lapsed during the year, net of re-issuance 1,410,025 728.44 3,921,340 568.36 Less: Exercised during the year 39,519,912 296.27 34,044,356 276.72 Outstanding at the end of the year 198,731,466 411.26 225,025,803 361.60 Options exercisable 159,296,026 324.55 172,938,533 289.69 The following table sets forth, the summary of stock options outstanding at March 31, 2024. Range of exercise price (E per share) Number of shares arising out of options Weighted average exercise price (E per share) Weighted average remaining contractual life (Number of years) 60-199 4,012,005 161.88 1.25 200-399 115,605,713 267.72 3.54 400-599 42,086,634 483.18 3.22 600-799 22,668,214 747.64 5.20 800-899 14,358,900 894.81 6.16 Annual Report 2023-24 | 309 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The following table sets forth, the summary of stock options outstanding at March 31, 2023. Range of exercise price (E per share) Number of shares arising out of options Weighted average exercise price (E per share) Weighted average remaining contractual life (Number of years) 60-199 7,202,993 160.84 1.85 200-399 145,129,078 267.52 4.37 400-599 48,347,432 479.32 4.15 600-799 24,274,900 747.62 6.17 800-899 71,400 862.88 6.58 The following table sets forth, for the periods indicated, the summary of the status of the Bank’s stock unit plan. ` except number of units Particulars Stock Units outstanding Year ended March 31, 2024 Year ended March 31, 2023 Number of Units Weighted average exercise price Number of Units Weighted average exercise price Outstanding at the beginning of the year - - - - Add: Granted during the year 4,419,670 2.00 - - Less: Lapsed during the year, net of re-issuance 228,860 2.00 - - Less: Exercised during the year - - - - Outstanding at the end of the year 4,190,810 2.00 - - Units exercisable 2,700 2.00 - - At March 31, 2024, the weighted average remaining contractual life of stock units outstanding was 6.24 years. The options were exercised regularly throughout the period and weighted average share price as per National Stock Exchange price volume data during the year ended March 31, 2024 was ` 972.60 (Year ended March 31, 2023: ` 832.00). ICICI Life: ICICI Prudential Life Insurance Company Limited has formulated ESOS for their employees. There was no compensation cost for the year ended March 31, 2024 based on the intrinsic value of options. The following table sets forth, for the periods indicated, a summary of the status of the stock option plan of ICICI Prudential Life Insurance Company Limited. ` except number of options Particulars Stock options outstanding Year ended March 31, 2024 Year ended March 31, 2023 Number of options Weighted average exercise price Number of options Weighted average exercise price Outstanding at the beginning of the year 23,942,115 435.18 20,184,630 404.87 Add: Granted during the year 7,215,300 448.95 5,227,730 541.00 Less: Forfeited/lapsed during the year 613,390 485.02 199,690 461.18 Less: Exercised during the year 2,094,015 394.28 1,270,555 384.94 Outstanding at the end of the year 28,450,010 440.61 23,942,115 435.18 Options exercisable 16,332,549 415.08 13,559,815 395.34 310 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The following table sets forth, summary of stock options outstanding of ICICI Prudential Life Insurance Company Limited at March 31, 2024. Range of exercise price (E per share) Number of shares arising out of options Weighted average exercise price (E per share) Weighted average remaining contractual life (Number of years) 300-399 7,363,410 379.67 2.36 400-499 15,904,970 435.91 5.09 500-599 5,127,130 540.79 5.12 600-699 54,500 619.43 4.87 The following table sets forth, summary of stock options outstanding of ICICI Prudential Life Insurance Company Limited at March 31, 2023. Range of exercise price (E per share) Number of shares arising out of options Weighted average exercise price (E per share) Weighted average remaining contractual life (Number of years) 300-399 8,825,615 379.70 3.20 400-499 9,896,370 428.41 5.27 500-599 5,165,630 541.00 6.10 600-699 54,500 619.43 5.06 ICICI General1: ICICI Lombard General Insurance Company Limited has formulated ESOS for their employees. There was no compensation cost for the year ended March 31, 2024 based on the intrinsic value of options. The following table sets forth, for the periods indicated, a summary of the status of the stock option plan of ICICI Lombard General Insurance Company Limited. ` except number of options Particulars Stock options outstanding Year ended March 31, 2024 Number of options Weighted average exercise price Outstanding at the beginning of the year 12,646,890 1,398.39 Add: Granted during the year 4,527,220 1,115.92 Less: Forfeited/lapsed during the year 1,074,224 1,276.98 Less: Exercised during the year 1,563,002 1,055.30 Outstanding at the end of the year 14,536,884 1,074.44 Options exercisable 5,497,000 888.94 Annual Report 2023-24 | 311 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The following table sets forth, summary of stock options outstanding of ICICI Lombard General Insurance Company Limited at March 31, 2024. Range of exercise price (E per share) Number of shares arising out of options Weighted average exercise price (E per share) Weighted average remaining contractual life (Number of years) 700-800 1,105,080 715.15 2.45 800-1100 1,540,310 1,086.85 2.05 1100-1200 4,038,370 1,104.10 6.05 1200-1300 1,924,840 1,235.15 3.11 1300-1400 3,439,304 1,363.10 5.41 1400-1500 2,348,980 1,417.15 4.05 1500-1600 40,000 1,589.70 5.10 1600-1700 100,000 1,639.25 6.90 1. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. ICICI Securities: ICICI Securities Limited has formulated ESOS and ESUS 2022 for their employees. There was no compensation cost for the year ended March 31, 2024 based on the intrinsic value of options. The following table sets forth, for the periods indicated, a summary of the status of the stock option plan of ICICI Securities Limited. ` except number of options Particulars Stock options outstanding Year ended March 31, 2024 Year ended March 31, 2023 Number of options Weighted average exercise price (E per share) Number of options Weighted average exercise price (E per share) Outstanding at the beginning of the year 4,146,544 445.94 2,939,279 342.43 Add: Granted during the year 2,568,250 473.28 1,657,700 624.68 Less: Forfeited/lapsed during the year 165,680 544.97 263,980 514.77 Less : Exercised during the year 489,029 349.77 186,455 305.89 Outstanding at the end of the year 6,060,085 462.58 4,146,544 445.94 Options exercisable 2,266,545 382.85 1,588,294 306.03 The following table sets forth, summary of stock options outstanding of ICICI Securities Limited at March 31, 2024. Range of exercise price (E per share) Number of shares arising out of options Weighted average exercise price (E per share) Weighted average remaining contractual life (Number of years) 200-249 505,550 221.45 2.06 250-299 37,730 256.55 1.55 350-399 994,940 361.00 3.10 400-449 625,410 424.60 4.05 450-499 2,362,550 465.10 6.05 500-549 4,700 512.10 5.80 600-649 1,529,205 624.94 5.17 312 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The following table sets forth, summary of stock options outstanding of ICICI Securities Limited at March 31, 2023. Range of exercise price (E per share) Number of shares arising out of options Weighted average exercise price (E per share) Weighted average remaining contractual life (Number of years) 200-249 696,230 221.45 3.10 250-299 37,730 256.55 2.98 350-399 1,127,904 361.00 4.13 400-449 749,880 424.60 5.10 500-549 4,700 512.10 6.81 600-649 1,523,800 625.00 6.05 750-799 6,300 774.60 5.30 The following table sets forth, for the periods indicated, a summary of the status of the stock unit plan of ICICI Securities Limited. ` except number of options Particulars Stock options outstanding Year ended March 31, 2024 Year ended March 31, 2023 Number of options Weighted average exercise price (E per share) Number of options Weighted average exercise price (E per share) Outstanding at the beginning of the year - - - - Add: Granted during the year 800,990 5.00 - - Less: Lapsed during the year, net of re-issuance 92,770 5.00 - - Less: Exercised during the year - - - - Outstanding at the end of the year 708,220 5.00 - - Options exercisable - - - - At March 31, 2024, the weighted average remaining contractual life of stock units outstanding was 6.13 years. 4. Fixed assets The following table sets forth, for the periods indicated, the movement in software acquired by the Group, as included in fixed assets. ` in million Particulars At March 31, 2024 At March 31, 2023 At cost at March 31 of preceding year 36,232.4 33,010.5 Add: Adjustments1,2 8,307.6 - Adjusted cost at March 31 44,540.0 33,010.5 Additions during the year 7,555.5 5,480.1 Deductions during the year (876.3) (2,258.2) Depreciation to date (37,492.7) (26,065.1) Net block 13,726.5 10,167.3 1. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. 2. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. Annual Report 2023-24 | 313 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 5. Assets on lease 5.1 Assets taken under operating lease Operating leases primarily comprise office premises which are renewable at the option of the Group. (i) The following table sets forth, for the periods indicated, the details of liability for premises taken on non- cancellable operating leases. ` in million Particulars At March 31, 2024 At March 31, 2023 Not later than one year 992.7 924.1 Later than one year and not later than five years 2,462.6 1,443.2 Later than five years 2,375.1 396.2 Total 5,830.4 2,763.5 (ii) Total of non-cancellable lease payments recognised in the profit and loss account for the year ended March 31, 2024 is ` 1,540.5 million (year ended March 31, 2023: ` 1,064.3 million). 5.2 Assets taken under finance lease The following table sets forth, for the periods indicated, the details of assets taken on finance leases. ` in million Particulars At March 31, 2024 At March 31, 2023 A. Total minimum lease payments outstanding Not later than one year 249.8 271.3 Later than one year and not later than five years 359.9 596.1 Later than five years 0.2 14.9 Total 609.9 882.3 B. Interest cost payable Not later than one year 42.6 70.0 Later than one year and not later than five years 41.1 83.3 Later than five years - 0.5 Total 83.7 153.8 C. Present value of minimum lease payments payable (A-B) Not later than one year 207.2 201.3 Later than one year and not later than five years 318.8 512.8 Later than five years 0.2 14.4 Total 526.2 728.5 314 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 5.3 Assets given under finance lease The following table sets forth, for the periods indicated, the details of finance leases. ` in million Particulars At March 31, 2024 At March 31, 2023 Future minimum lease receipts Present value of lease receipts 34.3 50.2 Unmatured finance charges 0.8 2.0 Sub total 35.1 52.2 Less: collective provision (0.1) (0.2) Total 35.0 52.0 Maturity profile of future minimum lease receipts - Not later than one year 35.1 19.0 - Later than one year and not later than five years 0.0 33.2 - Later than five years - - Total 35.1 52.2 Less: collective provision (0.1) (0.2) Total 35.0 52.0 Maturity profile of present value of lease rentals The following table sets forth, for the periods indicated, the details of maturity profile of present value of finance lease receipts. ` in million Particulars At March 31, 2024 At March 31, 2023 Maturity profile of future present value of finance lease receipts - Not later than one year 34.3 17.7 - Later than one year and not later than five years - 32.5 - Later than five years - - Total 34.3 50.2 Less: collective provision (0.1) (0.2) Total 34.2 50.0 6. Provisions and contingencies The following table sets forth, for the periods indicated, the break-up of provisions and contingencies included in the profit and loss account. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Provision for depreciation of investments1 7,049.6 13,917.0 Provision towards non-performing and other assets 9,635.7 (3,653.5) Provision towards income tax a) Current 136,933.0 114,564.4 b) Deferred 17,343.2 3,370.0 Other provisions and contingencies2,3 20,438.8 59,135.7 Total provisions and contingencies 191,400.3 187,333.6 1. During the year ended March 31, 2024, the Group made a provision of ` 5,105.0 million against its investments in Alternative Investment Funds (AIFs) as per RBI circular dated December 19, 2023. 2. No contingency provision was made by the Bank during year ended March 31, 2024 (year ended March 31, 2023: ` 56,500.0 million). 3. Includes general provision made towards standard assets, provision made on fixed assets acquired under debt-asset swap and non-fund based facilities. Annual Report 2023-24 | 315 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The Group has assessed its obligations arising in the normal course of business, including pending litigations, proceedings pending with tax authorities and other contracts including derivative and long-term contracts. In accordance with the provisions of Accounting Standard - 29 on ‘Provisions, Contingent Liabilities and Contingent Assets’, the Group recognises a provision for material foreseeable losses when it has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. In cases where the available information indicates that the loss on the contingency is reasonably possible or the amount of loss cannot be reasonably estimated, a disclosure to this effect is made as contingent liabilities in the financial statements. The Group does not expect the outcome of these proceedings to have a materially adverse effect on its financial results. For insurance contracts booked in its life insurance subsidiary, reliance has been placed on the Appointed Actuary for actuarial valuation of ‘liabilities for policies in force’. The Appointed Actuary has confirmed that the assumptions used in valuation of liabilities for policies in force are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the IRDAI. 7. Employee benefits Pension The following tables set forth, for the periods indicated, movement of the present value of the defined benefit obligation, fair value of plan assets and other details for pension benefits. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening obligations 18,429.1 18,661.0 Service cost 114.8 151.7 Interest cost 1,314.0 1,150.6 Actuarial (gain)/loss (11.5) 758.2 Past service cost 306.91 - Liabilities extinguished on settlement (2,137.9) (2,192.6) Benefits paid (95.5) (99.8) Obligations at the end of year 17,919.9 18,429.1 Opening plan assets, at fair value 18,190.2 19,843.3 Expected return on plan assets 1,361.0 1,522.0 Actuarial gain/(loss) 439.5 (682.0) Assets distributed on settlement (2,375.4) (2,436.2) Contributions 401.7 42.9 Benefits paid (95.5) (99.8) Closing plan assets, at fair value 17,921.5 18,190.2 Fair value of plan assets at the end of the year 17,921.5 18,190.2 Present value of the defined benefit obligations at the end of the year (17,919.9) (18,429.1) Amount not recognised as an asset (limit in Para 59(b) of AS 15 on ‘employee benefits’) - - Asset/(liability) 1.6 (238.9) Cost2 Service cost 114.8 151.7 Interest cost 1,314.0 1,150.6 Expected return on plan assets (1,361.0) (1,522.0) 316 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Actuarial (gain)/loss (451.0) 1,440.2 Past service cost 306.91 - Curtailments & settlements (gain)/loss 237.5 243.6 Effect of the limit in para 59(b) of AS 15 on ‘employee benefits’ - (401.9) Net cost 161.2 1,062.2 Actual return on plan assets 1,800.5 840.0 Expected employer’s contribution next year 400.0 1,000.0 Investment details of plan assets Government of India securities 41.46% 41.74% Corporate bonds 46.59% 48.30% Equity securities in listed companies 9.35% 7.08% Others 2.60% 2.88% Assumptions Discount rate 7.20% 7.30% Salary escalation rate: On Basic pay 1.50% 1.50% On Dearness relief 8.00% 8.00% Estimated rate of return on plan assets 7.50% 7.50% 1. Represents impact towards dearness allowance neutralization as per IBA notification dated October 16, 2023. 2. Included in line item ‘Payments to and provision for employees’ of Schedule- 16 Operating expenses. Estimated rate of return on plan assets is based on the expected average long-term rate of return on investments of the Fund during the estimated term of the obligations. Experience adjustment ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2022 Year ended March 31, 2021 Year ended March 31, 2020 Fair value of plan assets 17,921.5 18,190.2 19,843.3 21,162.2 16,972.1 Defined benefit obligations (17,919.9) (18,429.1) (18,661.0) (20,265.6) (19,914.3) Amount not recognised as an asset (limit in para 59(b) of AS 15 on ‘employee benefits’) - - (401.9) (304.8) - Surplus/(deficit) 1.6 (238.9) 780.4 591.8 (2,942.2) Experience adjustment on plan assets 439.5 (682.0) (331.9) 521.9 741.1 Experience adjustment on plan liabilities (227.0) 805.8 809.0 613.4 2,186.1 Annual Report 2023-24 | 317 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Gratuity The following table sets forth, for the periods indicated, movement of the present value of the defined benefit obligation, fair value of plan assets and other details for gratuity benefits of the Group. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening obligations 18,896.8 16,895.1 Add: Adjustment for exchange fluctuation on opening obligation 2.4 12.2 Add: Adjustment1,2 1,695.1 - Adjusted obligations 20,594.3 16,907.3 Service cost 1,915.7 1,643.8 Interest cost 1,435.5 1,166.7 Actuarial (gain)/loss 1,246.5 1,108.1 Past service cost - (72.2) Liability transferred from/to other companies 13.9 20.9 Benefits paid (1,785.0) (1,877.8) Obligations at the end of the year 23,420.9 18,896.8 Opening plan assets, at fair value 17,061.6 16,738.3 Add: Adjustment1,2 1,608.9 - Adjusted plan assets at fair value 18,670.5 16,738.3 Expected return on plan assets 1,238.9 1,197.7 Actuarial gain/(loss) 870.5 (577.3) Contributions 3,932.8 1,544.4 Assets transferred from/to other companies 13.9 36.5 Benefits paid (1,778.1) (1,877.8) Closing plan assets, at fair value 22,948.5 17,061.6 Fair value of plan assets at the end of the year 22,948.5 17,061.6 Present value of the defined benefit obligations at the end of the year (23,420.9) (18,896.8) Amount not recognised as an asset (limit in para 59(b) of AS 15 on ‘employee benefits’) - - Asset/(liability) (472.4) (1,835.2) Cost3 Service cost 1,915.7 1,643.8 Interest cost 1,435.5 1,166.7 Expected return on plan assets (1,238.9) (1,197.7) Actuarial (gain)/loss 376.1 1,685.4 Past service cost - (72.2) Exchange fluctuation loss/(gain) 2.4 12.2 Effect of the limit in para 59(b) of AS 15 on ‘employee benefits’ - - Net cost 2,490.8 3,238.2 Actual return on plan assets 2,109.3 620.4 Expected employer’s contribution next year 1,731.0 1,731.0 318 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Investment details of plan assets Insurer managed funds 21.85% 9.97% Government of India securities 30.73% 30.07% Corporate bonds 34.90% 42.87% Equity 11.23% 15.04% Others 1.29% 2.05% Assumptions Discount rate 7.15%-7.25% 7.30%-7.50% Salary escalation rate 7.00%-10.00% 7.00%-10.00% Estimated rate of return on plan assets 7.00%-7.50% 7.00%-8.00% 1. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. 2. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. 3. Included in line item ‘Payments to and provision for employees’ of Schedule- 16 Operating expenses. Estimated rate of return on plan assets is based on the expected average long-term rate of return on investments of the Fund during the estimated term of the obligations. Experience adjustment ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2022 Year ended March 31, 2021 Year ended March 31, 2020 Fair value of plan assets 22,948.5 17,061.6 16,738.3 16,541.6 13,636.8 Defined benefit obligations (23,420.9) (18,896.8) (16,895.1) (16,954.5) (15,743.6) Amount not recognised as an asset (limit in para 59(b) of AS 15 on ‘employee benefits’) - - - - - Surplus/(deficit) (472.4) (1,835.2) (156.8) (412.9) (2,106.8) Experience adjustment on plan assets 870.5 (577.3) (33.1) 892.1 (167.4) Experience adjustment on plan liabilities 1,211.4 869.4 464.7 (548.2) 253.6 The estimates of future salary increases, considered in actuarial valuation, take into consideration inflation, seniority, promotion and other relevant factors. Annual Report 2023-24 | 319 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED Provident Fund (PF) The Group does not have any liability towards interest rate guarantee on exempt provident fund on the basis of actuarial valuation, the Group has not made any provision for the year ended March 31, 2024 (year ended March 31, 2023: Nil). The following tables set forth, for the periods indicated, movement of the present value of the defined benefit obligation, fair value of plan assets and other details for provident fund of the Group. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Opening obligations 55,367.7 49,411.5 Less: Adjustments1 - (655.3) Adjusted balance 55,367.7 48,756.2 Service cost 3,381.8 2,747.6 Interest cost 4,237.9 3,367.1 Actuarial (gain)/loss 919.2 1,032.8 Employees contribution 5,726.7 4,707.4 Liability transferred from/to other companies 1,169.0 805.2 Benefits paid (5,782.3) (6,048.6) Obligations at end of the year 65,020.0 55,367.7 Opening plan assets, at fair value 56,128.1 50,656.3 Less: Adjustments1 - (407.5) Adjusted balance 56,128.1 50,248.8 Expected return on plan assets 4,613.3 4,100.3 Actuarial gain/(loss) 1,400.7 (432.8) Employer contributions 3,381.8 2,747.6 Employees contributions 5,726.6 4,707.4 Assets transfer from/to other companies 1,169.0 805.4 Benefits paid (5,782.3) (6,048.6) Closing plan assets, at fair value 66,637.2 56,128.1 Plan assets at the end of the year 66,637.2 56,128.1 Present value of the defined benefit obligations at the end of the year (65,020.0) (55,367.7) Amount not recognised as an asset (Limit in para 59(b) of AS 15 on ‘employee benefits’)2 (1,617.2) (760.4) Asset/(liability) - - Cost3 Service cost 3,381.8 2,747.6 Interest cost 4,237.9 3,367.1 Expected return on plan assets (4,613.3) (4,100.3) Actuarial (gain)/loss (481.6) 1,465.6 Effect of limit in para 59(b)2 856.9 (732.4) 320 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Net cost 3,381.7 2,747.6 Actual return on plan assets 6,014.0 3,667.5 Expected employer's contribution next year 3,650.8 2,965.9 Investment details of plan assets Government of India securities 54.37% 55.20% Corporate Bonds 33.57% 34.83% Special deposit scheme 0.81% 0.96% Others 11.25% 9.01% Assumptions Discount rate 7.15%-7.20% 7.35%-7.40% Expected rate of return on assets 7.84%-8.43% 7.97%-8.76% Discount rate for the remaining term to maturity of investments 7.20%-7.25% 7.40%-7.60% Average historic yield on the investment 7.84%-8.53% 8.01%-8.96% Guaranteed rate of return 8.25%-8.25% 8.15%-8.15% 1. During the year ended March 31, 2023, ICICI Home Finance Company Limited realised and transferred assets and liabilities of Employee Provident Fund Trust to Central Provident Fund. 2. Pursuant to revised Guidance Note 29 on “Valuation of Interest Rate Guarantees on Exempt Provident Funds under AS 15 (Revised)” issued by the Institute of Actuaries of India on February 16, 2022, plan assets held by the PF Trust have been fair valued. The amount represents the fair value gain on plan assets. 3. Included in line item ‘Payments to and provision for employees’ of Schedule- 16 Operating expenses. Experience adjustment ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2022 Year ended March 31, 2021 Year ended March 31, 2020 Fair value of plan assets 66,637.2 56,128.1 50,656.3 45,615.2 38,682.6 Defined benefit obligations (65,020.0) (55,367.7) (49,411.5) (45,617.9) (38,703.4) Amount not recognised as an asset (limit in para 59(b) AS 15 on ‘employee benefits’)1 (1,617.2) (760.4) (1,244.8) - - Surplus/(deficit) - - - (2.7) (20.8) Experience adjustment on plan assets 1,400.7 (432.8) 415.1 663.8 (662.0) Experience adjustment on plan liabilities 445.6 753.2 (684.8) 1,703.3 (129.9) 1. Pursuant to revised Guidance Note 29 on “Valuation of Interest Rate Guarantees on Exempt Provident Funds under AS 15 (Revised)” issued by Institute of Actuaries of India on February 16, 2022, plan assets held by PF Trust have been fair valued. The amount represents the fair value gain on plan assets. Annual Report 2023-24 | 321 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The Group has contributed ` 5,861.0 million to provident fund including Government of India managed employees provident fund for the year ended March 31, 2024 (year ended March 31, 2023: ` 4,344.2 million), which includes compulsory contribution made towards employee pension scheme under Employees Provident Fund and Miscellaneous Provisions Act, 1952. Superannuation Fund The Group has contributed ` 355.1 million for the year ended March 31, 2024 (year ended March 31, 2023: ` 321.8 million) to Superannuation Fund for employees who had opted for the scheme. National Pension Scheme (NPS) The Group has contributed ` 452.2 million for the year ended March 31, 2024 (year ended March 31, 2023: ` 361.1 million) to NPS for employees who had opted for the scheme. Compensated absence The following table sets forth, for the periods indicated, movement in provision for compensated absence. ` in million Particulars Year ended March 31, 2024 Year ended March 31, 2023 Total actuarial liability 5,436.0 3,629.6 Cost1 1,702.2 884.9 Assumptions Discount rate 7.12%-7.25% 7.30%-7.55% Salary escalation rate 5.96%-10.00% 7.00%-10.00% 1. Included in line item ‘Payments to and provision for employees’ of schedule- 16 Operating expenses. 8. Provision for income tax The provision for income tax (including deferred tax) for the year ended March 31, 2024 amounted to ` 154,276.2 million (year ended March 31, 2023: ` 117,934.4 million). The Group has a comprehensive system of maintenance of information and documents required by transfer pricing legislation under sections 92-92F of the Income Tax Act, 1961. The management is of the opinion that all transactions with international related parties and specified transactions with domestic related parties are primarily at arm's length so that the above legislation does not have material impact on the financial statements. 322 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 9. Deferred tax At March 31, 2024, the Group has recorded net deferred tax asset of ` 63,115.8 million (March 31, 2023: ` 76,194.4 million), which has been included in other assets. The following table sets forth, for the periods indicated, the break-up of deferred tax assets and liabilities into major items. ` in million Particulars At March 31, 2024 At March 31, 2023 Deferred tax assets Provision for bad and doubtful debts 95,145.6 104,780.1 Provision for operating expenses 4,026.9 4,026.9 Provision/MTM on investment 6,774.4 5,404.1 Provision for expense allowed on payment basis 5,175.4 4,870.3 Unexpired risk reserve 1,486.5 - Foreign currency translation reserve1 148.0 (615.0) Others2 2,213.2 822.0 Total deferred tax assets 114,970.0 119,288.4 Deferred tax liabilities Special reserve deduction 45,489.3 37,695.4 Mark-to-market gains1 620.6 490.0 Depreciation on fixed assets 5,074.3 4,476.7 Interest on refund of taxes1 441.9 206.2 Others 228.1 225.7 Total deferred tax liabilities 51,854.2 43,094.0 Total net deferred tax assets/(liabilities) 63,115.8 76,194.4 1. These items are considered in accordance with the requirements of Income Computation and Disclosure Standards (ICDS). 2. Includes deferred tax assets created primarily on operating loss, interest on credit impaired loans and provision for diminution in value of investments. Annual Report 2023-24 | 323 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 10. Information about business and geographical segments A. Business Segments Pursuant to the guidelines issued by RBI on AS 17 – Segment Reporting, the following business segments of the Group have been reported. i. Retail banking includes exposures of the Bank which satisfy the four criteria of orientation, product, granularity and low value of individual exposures for retail exposures laid down in Basel Committee on Banking Supervision (BCBS) document “International Convergence of Capital Measurement and Capital Standards: A Revised Framework”. This segment also includes income from credit cards, debit cards, third party product distribution and the associated costs. ii. Wholesale banking includes all advances to trusts, partnership firms, companies and statutory bodies, by the Bank which are not included under Retail banking. iii. Treasury primarily includes the entire investment and derivative portfolio of the Bank. iv. Other banking includes leasing operations and other items not attributable to any particular business segment of the Bank. Further, it includes the Bank’s banking subsidiaries i.e. ICICI Bank UK PLC and ICICI Bank Canada. v. Life insurance represents results of ICICI Prudential Life Insurance Company Limited. vi. Others includes ICICI Lombard General Insurance Company Limited, ICICI Home Finance Company Limited, ICICI Venture Funds Management Company Limited, ICICI International Limited, ICICI Securities Primary Dealership Limited, ICICI Securities Limited, ICICI Securities Holdings Inc., ICICI Securities Inc., ICICI Prudential Asset Management Company Limited, ICICI Prudential Trust Limited, ICICI Investment Management Company Limited, ICICI Trusteeship Services Limited, ICICI Prudential Pension Funds Management Company Limited and I-Process Services (India) Private Limited. vii. Unallocated includes items such as tax paid in advance net of provision, deferred tax and provisions to the extent reckoned at the entity level. Income, expenses, assets and liabilities are either specifically identified with individual segments or are allocated to segments on a systematic basis. All liabilities of the Bank are transfer priced to a central treasury unit, which pools all funds and lends to the business units at appropriate rates based on the relevant maturity of assets being funded after adjusting for regulatory reserve requirements. The transfer pricing mechanism of the Bank is periodically reviewed. The segment results are determined based on the transfer pricing mechanism prevailing for the respective reporting periods. The results of reported segments for the year ended March 31, 2024 are not comparable with that of reported segments for the year ended March 31, 2023 to the extent new entities have been consolidated and entities that have been discontinued from consolidation. 324 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The following table sets forth, the business segment results for the year ended March 31, 2024. ` in million Sr. no. Particulars Retail banking Wholesale banking Treasury Other banking business Life insurance Others Inter- segment adjustments Total 1 Revenue 1,345,475.7 717,802.2 1,137,018.3 64,034.0 542,361.3 159,326.8 (1,605,641.1) 2,360,377.2 2 Segment results1 188,491.7 199,717.1 146,408.8 16,384.0 9,232.3 62,301.7 (18,192.0) 604,343.6 3 Unallocated expenses - 4 Share of profit from associates 10,737.7 5 Operating profit (2) – (3) + (4)1 615,081.3 6 Income tax expenses (net)/(net deferred tax credit) 154,276.2 7 Net profit2 (5) – (6) 460,805.1 Other information 8 Segment assets 7,193,136.2 4,824,561.0 6,340,548.0 893,056.2 2,987,952.9 1,508,283.1 (182,618.8) 23,564,918.6 9 Unallocated assets 75,711.7 10 Total assets (8) + (9) 23,640,630.3 11 Segment liabilities 10,198,454.9 4,565,715.3 3,815,846.83 607,215.63 2,989,997.03 1,515,019.53 (182,618.8)3 23,509,630.3 12 Unallocated liabilities 131,000.0 13 Total liabilities (11) + (12) 23,640,630.3 14 Capital expenditure 19,984.4 7,806.3 1,390.0 598.4 3,128.9 3,669.0 - 36,577.0 15 Depreciation 10,978.1 4,596.4 788.2 444.8 1,129.0 1,432.0 (16.4) 19,352.1 1. Profit before tax and minority interest. 2. Includes share of net profit of minority shareholders. 3. Includes share capital and reserves and surplus. Annual Report 2023-24 | 325 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED The following table sets forth, the business segment results for the year ended March 31, 2023. ` in million Sr. no. Particulars Retail banking Wholesale banking Treasury Other banking business Life insurance Others Inter- segment adjustments Total 1 Revenue 1,037,753.4 506,148.5 845,369.2 44,640.0 479,301.7 97,259.8 (1,148,684.6) 1,861,788.0 2 Segment results1 175,336.8 157,857.8 140,372.1 10,014.5 8,968.9 42,023.7 (15,509.2) 519,064.6 3 Unallocated expenses 56,500.0 4 Share of profit from associates 9,982.9 5 Operating profit (2) – (3) + (4)1 472,547.5 6 Income tax expenses (net)/(net deferred tax credit) 117,934.4 7 Net profit2 (5) – (6) 354,613.1 Other information 8 Segment assets 6,039,593.7 4,328,743.5 5,129,405.0 836,960.5 2,556,899.0 711,348.4 (114,612.3) 19,488,337.8 9 Unallocated assets 96,567.2 10 Total assets (8) + (9) 19,584,905.0 11 Segment liabilities 8,913,545.4 3,472,764.9 3,344,275.63 564,779.63 2,558,472.03 714,679.83 (114,612.3)3 19,453,905.0 12 Unallocated liabilities 131,000.0 13 Total liabilities (11) + (12) 19,584,905.0 14 Capital expenditure 11,682.9 5,251.8 610.6 455.2 1,357.0 1,884.8 - 21,242.3 15 Depreciation 9,274.5 3,427.2 335.8 405.2 835.1 884.2 (16.4) 15,145.6 1. Profit before tax and minority interest. 2. Includes share of net profit of minority shareholders. 3. Includes share capital and reserves and surplus. 326 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED B. Geographical segments The Group reports its operations under the following geographical segments. • Domestic operations comprise branches and subsidiaries/joint ventures in India. • Foreign operations comprise branches and subsidiaries/joint ventures outside India and offshore banking units in India. The Group conducts transactions with its customers on a global basis in accordance with their business requirements, which may span across various geographies. The following tables set forth, for the periods indicated, the geographical segment results. ` in million Revenue Year ended March 31, 2024 Year ended March 31, 2023 Domestic operations1 2,296,083.0 1,819,445.3 Foreign operations 75,031.9 52,325.6 Total 2,371,114.9 1,871,770.9 1. Includes share of profit from associates of ` 10,737.7 million (March 31, 2023: ` 9,982.9 million). ` in million Assets At March 31, 2024 At March 31, 2023 Domestic operations 22,366,146.4 18,242,212.3 Foreign operations 1,198,772.2 1,246,125.5 Total 23,564,918.6 19,488,337.8 1. Segment assets do not include tax paid in advance/tax deducted at source (net) and deferred tax assets (net). The following table sets forth, for the periods indicated, capital expenditure and depreciation thereon for the geographical segments. ` in million Particulars Capital expenditure incurred during the Depreciation provided during the Year ended March 31, 2024 Year ended March 31, 2023 Year ended March 31, 2024 Year ended March 31, 2023 Domestic operations 36,299.6 20,914.1 19,081.8 14,867.2 Foreign operations 277.4 328.2 270.4 278.4 Total 36,577.0 21,242.3 19,352.2 15,145.6 11. Penalties/fines imposed by banking regulatory bodies RBI imposed a penalty of ` 121.9 million on October 17, 2023 based on the deficiency observed in regulatory compliance with the Banking Regulation Act, during Statutory Inspections for supervisory evaluation (ISE 2020 and ISE 2021) of the Bank conducted by RBI (year ended March 31, 2023: Nil). Annual Report 2023-24 | 327 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 12. Additional information to consolidated accounts Additional information to consolidated accounts at March 31, 2024 (Pursuant to Schedule III of the Companies Act, 2013). ` in million Name of the entity Net assets2 Share in profit or loss % of total net assets Amount % of total net profit Amount Parent ICICI Bank Limited 93.1% 2,383,993.2 92.4% 408,882.7 Subsidiaries Indian ICICI Securities Primary Dealership Limited 0.7% 18,288.0 0.9% 4,139.1 ICICI Securities Limited 1.5% 38,825.6 3.9% 17,305.9 ICICI Home Finance Company Limited 1.1% 28,029.3 1.2% 5,316.0 ICICI Trusteeship Services Limited 0.0% 9.7 0.0% 1.1 ICICI Investment Management Company Limited 0.0% 129.5 (0.0%) (57.6) ICICI Venture Funds Management Company Limited 0.1% 2,483.4 0.0% 110.2 ICICI Prudential Life Insurance Company Limited 4.3% 110,082.3 1.9% 8,523.9 ICICI Lombard General Insurance Company Limited3 5.1% 129,493.3 0.3% 1,543.9 ICICI Prudential Trust Limited 0.0% 19.8 0.0% 4.7 ICICI Prudential Asset Management Company Limited 1.0% 24,849.0 4.1% 18,145.0 ICICI Prudential Pension Funds Management Company Limited 0.0% 560.2 (0.0%) (17.2) I-Process Services (India) Private Limited4 0.0% 619.8 0.0% 15.6 Foreign ICICI Bank UK PLC 1.1% 28,146.7 0.5% 2,277.8 ICICI Bank Canada 1.1% 28,043.6 1.0% 4,500.7 ICICI International Limited 0.0% 130.6 0.0% 6.7 ICICI Securities Holdings Inc. 0.0% 131.9 (0.0%) (1.0) ICICI Securities Inc. 0.0% 396.5 0.0% 25.6 Other consolidated entities Indian ICICI Strategic Investments Fund 0.0% 129.8 0.0% 7.6 Foreign NIL - - - - Minority Interests (5.4%) (138,884.2) (4.1%) (18,241.4) Associates Indian ICICI Lombard General Insurance Company Limited3 1.9% 8,452.0 I-Process Services (India) Private Limited4 0.0% 25.4 NIIT Institute of Finance Banking and Insurance Training Limited - - 0.0% 10.7 328 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED ` in million Name of the entity Net assets2 Share in profit or loss % of total net assets Amount % of total net profit Amount ICICI Merchant Services Private Limited - - 0.0% 215.8 India Infradebt Limited - - 0.4% 1,869.7 India Advantage Fund III - - 0.0% 60.6 India Advantage Fund IV - - 0.0% 85.7 Arteria Technologies Private Limited - - 0.0% 17.9 Foreign NIL - - - - Joint Ventures NIL - - - - Inter-company adjustments (3.7%) (94,039.7) (4.7%) (20,663.4) TOTAL 100.0% 2,561,438.3 100.0% 442,563.7 1. 0.0 represents insignificant amount. 2. Total assets minus total liabilities. 3. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. 4. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. Additional information to consolidated accounts at March 31, 2023 (Pursuant to Schedule III of the Companies Act, 2013). ` in million Name of the entity Net assets2 Share in profit or loss % of total net assets Amount % of total net profit Amount Parent ICICI Bank Limited 93.6% 2,007,153.8 93.7% 318,965.0 Subsidiaries Indian ICICI Securities Primary Dealership Limited 0.7% 15,815.5 0.4% 1,277.8 ICICI Securities Limited 1.3% 28,219.2 3.3% 11,334.7 ICICI Home Finance Company Limited 1.1% 22,998.6 1.1% 3,653.1 ICICI Trusteeship Services Limited 0.0% 8.7 0.0% 0.1 ICICI Investment Management Company Limited 0.0% 187.0 (0.0%) (58.7) ICICI Venture Funds Management Company Limited 0.1% 2,473.3 0.0% 61.9 ICICI Prudential Life Insurance Company Limited 4.7% 100,915.8 2.4% 8,106.6 ICICI Prudential Trust Limited 0.0% 16.9 0.0% 2.2 ICICI Prudential Asset Management Company Limited 1.0% 21,478.8 4.4% 15,077.0 ICICI Prudential Pension Funds Management Company Limited 0.0% 577.5 0.0% 28.3 Annual Report 2023-24 | 329 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED ` in million Name of the entity Net assets2 Share in profit or loss % of total net assets Amount % of total net profit Amount Foreign ICICI Bank UK PLC 1.2% 26,158.3 0.3% 1,045.9 ICICI Bank Canada 1.2% 25,256.2 0.8% 2,818.9 ICICI International Limited 0.0% 122.0 0.0% 8.9 ICICI Securities Holdings Inc. 0.0% 132.7 0.0% 2.0 ICICI Securities Inc. 0.0% 364.8 0.0% 58.3 Other consolidated entities Indian ICICI Strategic Investments Fund 0.0% 119.4 0.0% 3.7 Foreign NIL - - - - Minority interests (3.1%) (66,867.5) (4.2%) (14,246.7) Associates Indian ICICI Lombard General Insurance Company Limited - - 2.4% 8,303.1 I-Process Services (India) Private Limited - - 0.0% 37.7 NIIT Institute of Finance Banking and Insurance Training Limited - - 0.0% 3.3 ICICI Merchant Services Private Limited - - 0.0% 63.0 India Infradebt Limited - - 0.5% 1,560.2 India Advantage Fund III - - 0.0% 0.0 India Advantage Fund IV - - (0.0%) (0.2) Arteria Technologies Private Limited - - 0.0% 15.7 Foreign NIL - - - - Joint Ventures NIL - - - - Inter-company adjustments (1.8%) (40,153.1) (5.1%) (17,755.4) TOTAL 100.0% 2,144,977.9 100.0% 340,366.4 1. 0.0 represents insignificant amount. 2. Total assets minus total liabilities. 13. Revaluation of fixed assets The Bank and its housing finance subsidiary follows the revaluation model for their premises (land and buildings) other than improvements to leasehold property as per AS 10 – ‘Property, Plant and Equipment’. In accordance with the policy, annual revaluation is carried out through external valuers, using methodologies such as direct sales comparison method and income capitalisation method and the incremental amount has been taken to revaluation reserve. The revalued amount at March 31, 2024 was ` 55,184.5 million (March 31, 2023: ` 55,500.0 million) as compared to the historical cost less accumulated depreciation of ` 24,062.4 million (March 31, 2023: ` 24,581.6 million). The revaluation reserve is not available for distribution of dividend. 330 | Annual Report 2023-24 SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 14. Proposed dividend on equity shares The Board of Directors at its meeting held on April 27, 2024 has recommended a dividend of ` 10.00 per equity share for the year ended March 31, 2024 (year ended March 31, 2023: ` 8.00 per equity share). The declaration and payment of dividend is subject to requisite approvals. 15. Divergence in asset classification and provisioning for NPAs In terms of the RBI circular no. //DOR.ACC.REC.No.74/21.04.018/2022-23 dated October 11, 2022, banks are required to disclose the divergences in asset classification and provisioning consequent to RBI’s annual supervisory process in their notes to accounts to the financial statements, wherever either (a) the additional provisioning requirements assessed by RBI exceed 5% (10% till March 31, 2023) of the reported net profits before provisions and contingencies or (b) the additional gross NPAs identified by RBI exceed 5% (10% till March 31, 2023) of the published incremental gross NPAs for the reference period, or both. Based on the condition mentioned in RBI circular, no disclosure on divergence in asset classification and provisioning for NPAs is required with respect to RBI’s supervisory process for the year ended March 31, 2023 and for the year ended March 31, 2022. 16. Disclosure on lending and borrowing activities The Bank and other subsidiaries, as part of its normal banking business, grants loans and advances, makes investment, provides guarantees to and accept deposits and borrowings from its customers, other entities and persons. These transactions are part of Bank’s normal banking business, which is conducted ensuring adherence to all regulatory requirements. Other than the transactions described above, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank and other subsidiaries incorporated in India to or in any other persons or entities, including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Bank and other subsidiaries incorporated in India (Ultimate Beneficiaries). The Bank and other subsidiaries incorporated in India have also not received any fund from any parties (Funding Party) with the understanding that the Bank and other subsidiaries incorporated in India shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. 17. Acquisition of ICICI Lombard General Insurance Company Limited On May 28, 2023, the Board of Directors of the Bank approved to increase shareholding in ICICI Lombard General Insurance Company Limited in multiple tranches up to 4.0% additional shareholding, as permissible under applicable law, to ensure compliance with the Section 19(2) of the Banking Regulation Act, 1949 and make the Company, a subsidiary of the Bank, subject to receipt of necessary regulatory approval(s). On August 4, 2023, RBI vide letter CO.DOR.RAUG.AUT.No.S2656/24.01.002/2023-24, had conveyed the approval to the Bank for acquiring additional stake in ICICI Lombard General Insurance Company Limited. On September 1, 2023, IRDAI vide letter 733/F&I/ToS/ ICICIL/FY24/1/59 had also conveyed the approval in connection to above. Accordingly, the Bank through stock exchange mechanism had acquired the additional stake in ICICI Lombard General Insurance Company Limited in multiple tranches, resulting into increase in shareholding of more than 50.0%. Consequently, ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. Accordingly, goodwill of ` 23,728.3 million was recognised on purchase of additional stake in ICICI Lombard General Insurance Company Limited. Annual Report 2023-24 | 331 Integrated Report Statutory Reports Financial Statements SCHEDULES forming part of the Consolidated Accounts (Contd.) CONSOLIDATED FINANCIAL STATEMENTS OF ICICI BANK LIMITED 18. Acquisition of I-Process Services (India) Private Limited On February 17-18, 2023, the Board of Directors of the Bank approved to make I-Process Services (India) Private Limited a wholly-owned subsidiary of the Bank, subject to receipt of requisite regulatory and statutory approvals. On September 8, 2023, RBI vide letter CO.DoR.RAUG.No.S3282/24.01.002/2023-24, had conveyed the approval to the Bank in connection to above. On January 30, 2024, the Bank entered into a share purchase agreement in relation to investment in equity shares of I-Process Services (India) Private Limited. Accordingly, the Bank purchased equity shares of the Company in off-market transactions. Consequently, I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024. Subsequently, I-Process Services (India) Private Limited became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. Accordingly, capital reserve of ` 358.5 million was recognised on purchase of additional stake in I-Process Services (India) Private Limited. 19. De-listing of ICICI Securities Company Limited The Board of Directors of the Bank on June 29, 2023 approved the draft scheme of arrangement for delisting of equity shares of ICICI Securities Limited, subject to receipt of requisite approvals. Pursuant to the order of the Hon’ble National Company Law Tribunal, Ahmedabad Bench, a meeting of the Equity Shareholders of the Bank was held on March 27, 2024, wherein the proposed Scheme was approved by the requisite majority of shareholders. The scheme is currently pending final approval of the Hon’ble National Company Law Tribunal, Ahmedabad Bench. 20. Additional disclosures Additional statutory information disclosed in the separate financial statements of the Bank and subsidiaries having no material bearing on the true and fair view on the consolidated financial statements and the information pertaining to the items which are not material have not been disclosed in the consolidated financial statements. 21. Comparative figures During FY2024, ICICI Lombard General Insurance Company Limited and I-Process Services (India) Private Limited has become subsidiaries due to increase in the Bank’s shareholding above 50.0%. Accordingly, the consolidated financial statements for FY2024 are not comparable with the previous year. Figures of the previous year have been re-grouped to conform to the current year presentation. Signatures to Schedules 1 to 18 As per our Report of even date. For and on behalf of the Board of Directors For M S K A & Associates Chartered Accountants ICAI Firm Registration no.: 105047W Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Tushar Kurani Partner Membership no.: 118580 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 For KKC & Associates LLP Chartered Accountants ICAI Firm Registration no.: 105146W/W100621 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant Vinit Jain Partner Membership no.: 145911 Mumbai April 27, 2024 332 | Annual Report 2023-24 STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENTS OF SUBSIDIARIES, ASSOCIATE COMPANIES AND JOINT VENTURES Part “A”: Subsidiaries ` in million Particulars ICICI Securities Primary Dealership Limited1 ICICI Securities Limited1 ICICI Securities Holdings Inc.1,2 ICICI Securities Inc.1,2 ICICI Home Finance Company Limited1 ICICI Trusteeship Services Limited ICICI Investment Management Company Limited ICICI Venture Funds Management Company Limited ICICI Prudential Life Insurance Company Limited ICICI Lombard General Insurance Company Limited3 ICICI International Limited4 ICICI Bank UK PLC4 ICICI Bank Canada5,6 ICICI Prudential Trust Limited ICICI Prudential Asset Management Company Limited1 ICICI Prudential Pension Funds Management Company Limited2 I-Process Services (India) Private Limited7 The date since when subsidiary was acquired September 15, 1993 March 9, 1995 June 12, 2000 June 13, 2000 November 1, 1999 September 1, 1999 March 9, 2000 March 25, 1998 October 1, 2000 February 24, 2024 February 27, 1998 August 19, 2003 October 13, 2003 August 26, 2005 August 26, 2005 April 22, 2009 March 20, 2024 Paid-up share capital8 1,563.4 1,616.8 728.2 571.7 12,035.3 0.5 249.9 10.0 14,406.2 4,926.9 75.1 18,357.1 15,666.1 1.0 176.5 600.0 0.5 Reserves & Surplus 16,957.4 37,310.3 (596.3) (175.1) 21,847.1 9.2 (120.5) 2,473.9 95,676.1 124,566.5 55.5 9,789.7 14,041.4 18.8 28,651.9 (39.8) 619.2 Total assets 358,462.5 255,876.0 132.7 473.0 238,886.9 10.1 196.4 3,080.6 2,989,997.6 633,083.0 147.0 183,762.9 383,541.9 23.0 35,540.9 615.9 1,781.0 Total liabilities (excluding capital and reserves) 339,941.7 216,948.9 0.8 76.4 205,004.5 0.4 67.0 596.7 2,879,911.8 503,582.6 16.5 155,616.1 353,834.4 3.2 6,712.5 55.7 1,161.2 Investments (including investment in subsidiaries)9 315,937.7 4,197.0 94.5 Nil 3,298.4 9.1 145.9 1,299.3 2,897,361.0 489,072.4 # 57,661.6 38,746.3 20.5 28,826.2 516.3 Nil Turnover (Gross income from operations) 26,289.7 50,480.0 Nil 227.0 26,407.8 2.4 139.4 926.7 432,356.4 255,941.6 52.2 11,926.1 18,863.7 15.2 33,759.0 177.8 11,145.7 Profit/(loss) before taxation 5,855.1 22,749.6 (0.9) 26.5 7,384.5 1.4 (57.6) 108.1 9,232.3 25,551.8 6.8 2,590.2 5,906.5 6.1 26,981.1 (27.1) 149.4 Provision for taxation 1,493.4 5,807.4 # 0.9 1,661.3 (0.3) Nil (2.2) 708.4 6,365.9 Nil 190.0 1,571.8 1.3 6,483.8 (9.9) Nil Profit/(loss) after taxation 4,361.7 16,942.2 (0.9) 25.6 5,723.2 1.1 (57.6) 110.3 8,523.9 19,185.9 6.8 2,400.2 4,334.7 4.7 20,497.3 (17.2) 149.4 Dividend paid 1,666.6 6,866.0 Nil Nil 300.9 Nil Nil 100.0 863.3 5,158.3 Nil 834.1 1,098.8 1.8 14,774.8 Nil Nil % of shareholding 100.00% 74.73% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 51.20% 51.27% 100.00% 100.00% 100.00% 50.80% 51.00% 100.00% 100.00% # amount less than 0.1 million Notes: 1. Financial information as per respective entity Ind AS financial statements pursuant to migration to Ind AS by these entities. 2. ICICI Securities Holdings Inc. is a wholly owned subsidiary of ICICI Securities Limited. ICICI Securities Inc. is a wholly owned subsidiary of ICICI Securities Holdings Inc. ICICI Prudential Pension Funds Management Company Limited is a wholly owned subsidiary of ICICI Prudential Life Insurance Company Limited. 3. ICICI Lombard General Insurance Company Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. February 29, 2024. Accordingly, an amount of ` 8,452.0 million has been accounted as per the equity method as prescribed by AS 23 on 'Accounting for investments in Consolidated Financial Statements'. 4. The financial information of ICICI Bank UK PLC and ICICI International Limited has been translated into Indian Rupees at the closing rate at March 31, 2024 of 1 USD = ` 83.4050. 5. The financial information of ICICI Bank Canada is for the period January 1, 2023 to December 31, 2023, being their financial year. 6. The financial information of ICICI Bank Canada has been translated into Indian Rupees at the closing rate at December 31, 2023 of 1 CAD = ` 62.7900. 7. I-Process Services (India) Private Limited ceased to be an associate and became a subsidiary of the Bank w.e.f. March 20, 2024 and became a wholly-owned subsidiary of the Bank w.e.f. March 22, 2024. Accordingly, an amount of ` 25.4 million has been accounted as per the equity method as prescribed by AS 23 on 'Accounting for investments in Consolidated Financial Statements'. 8. Paid-up share capital does not include share application money. 9. Investments include securities held as stock in trade. 10. Names of subsidiaries which are yet to commence operations: None 11. Names of subsidiaries which have been liquidated or sold during the year: None STATEMENT PURSUANT TO SECTION 129 OF COMPANIES ACT, 2013 Annual Report 2023-24 | 333 Integrated Report Statutory Reports Financial Statements Part "B": Associate companies and joint ventures ` in million Name of associate companies/joint ventures NIIT Institute of Finance Banking and Insurance Training Limited ICICI Merchant Services Private Limited India Infradebt Limited Arteria Technologies Private Limited Falcon Tyres Limited 1 Latest audited balance sheet date March 31, 2023 March 31, 2023 March 31, 2024 March 31, 2023 March 31, 2016 2 Date on which the Associate or Joint Venture was associated or acquired August 7, 2006 December 31, 2009 November 27, 2012 May 29, 2018 December 4, 2014 3 Shares of associate companies/joint ventures held by ICICI Group at March 31, 2024 Number of equity shares 1,900,000 75,582,000 367,361,007 9,990,000 20,445,177 Amount of investment in associate companies/joint ventures2 37.0 848.6 11,910.6 136.7 Nil Extent of holding (%) 18.79% 19.01% 42.33% 19.98% 26.39% 4 Description of significant influence Note 3 Note 3 Note 4 Note 3 Note 4 5 Reason of non-consolidation of the associate/joint venture N.A. N.A. N.A. N.A. Note 5 6 Networth attributable to shareholding as per latest audited balance sheet 30.2 1,200.6 13,672.4 66.3 N.A. 7 Profit/(loss) for the year ended March 31, 2024 i Considered in consolidation 10.7 218.6 1,869.8 18.0 N.A. ii Not considered in consolidation 46.2 931.5 2,547.3 72.1 N.A. Notes: 1 The above statement has been prepared based on the principles of Accounting Standard (AS) 23 - Accounting for Investments in Associates in Consolidated Financial Statements, issued by the Institute of Chartered Accountants of India (ICAI), and therefore does not include the companies where ICICI Group does not have any significant influence as defined under AS 23, although the group holds more than 20.00% of total share capital in those companies. 2 Represents carrying value. 3 In terms of AS 23, issued by ICAI, ICICI Group is deemed to have significant influence through its voting power and representation on the Board of directors of the investee company. 4 In terms of AS 23, issued by ICAI, ICICI Group is deemed to have significant influence due to its holding being more than 20.00% of the voting power in the investee company. 5 The investment in Falcon Tyres Limited is temporary in nature. 6 Names of associates or joint ventures which are yet to commence operations: None 7 Names of associates or joint ventures which have been liquidated or sold during the year: None For and on behalf of the Board of Directors Girish Chandra Chaturvedi Chairman DIN-00110996 Uday M. Chitale Director DIN-00043268 Sandeep Bakhshi Managing Director & CEO DIN-00109206 Rakesh Jha Executive Director DIN-00042075 Sandeep Batra Executive Director DIN-03620913 Ajay Kumar Gupta Executive Director DIN-07580795 Mumbai April 27, 2024 Anindya Banerjee Group Chief Financial Officer Prachiti Lalingkar Company Secretary Rajendra Khandelwal Chief Accountant STATEMENT PURSUANT TO SECTION 129 OF COMPANIES ACT, 2013 334 | Annual Report 2023-24 BASEL PILLAR 3 DISCLOSURES at March 31, 2024 Pillar 3 disclosures at March 31, 2024 as per Basel III guidelines of RBI have been disclosed separately on the Bank’s website under ‘Regulatory Disclosures Section’ on the home page. The link to this section is http://www.icicibank.com/regulatory-disclosure.page. The section contains the following disclosures: • Qualitative and quantitative disclosures at March 31, 2024 • Scope of application • Capital adequacy • Credit risk • Securitisation exposures • Market risk • Operational risk • Interest rate risk in the banking book (IRRBB) • Liquidity risk • Counterparty credit risk • Risk management framework of non-banking group companies • Disclosure requirements for remuneration • Equities – Disclosure for banking book positions • Leverage ratio • Composition of capital • Composition of capital - reconciliation requirements • Main features of regulatory capital instruments • Full terms and conditions of regulatory capital instruments Annual Report 2023-24 | 335 Integrated Report Statutory Reports Financial Statements GLOSSARY OF TERMS Terms Definition Average assets For the purpose of performance analysis, represents averages of daily balances Average cost of funds Cost of interest bearing liabilities Average equity Quarterly average of equity share capital and reserves and surplus Average yield Yield on interest earning assets Book value per share Share capital plus reserves and surplus divided by outstanding number of equity shares Capital (for CRAR) Capital includes share capital, reserves and surplus (revaluation reserve and foreign currency translation reserve are considered at discounted amount), capital instruments and general provisions as per the RBI Basel III guidelines Capital to risk weighted assets ratio (CRAR) Capital (for CRAR) divided by Risk Weighted Assets (RWAs) Core operating income Total income excluding treasury gains Core operating profit Profit before provisions and contingencies, excluding treasury gains Cost to income Operating expenses divided by net interest income and non-interest income Earnings per share Net profit after tax divided by weighted average number of equity shares outstanding during the year Effective tax rate Tax expenses divided by profit before tax High quality liquid assets Stock of liquid assets which can be readily sold at little or no loss of value or used as collateral to obtain funds Interest spread Average yield less average cost of funds Liquidity coverage ratio Ratio of unencumbered high quality liquid assets to total net cash outflows estimated for the next 30 calendar days Net interest income Total interest earned less total interest expended Net interest margin Total interest earned less total interest expended divided by average interest earning assets Net worth Total of equity share capital, employees stock options outstanding and reserves and surplus Operating profit Profit before provisions and contingencies Provision coverage ratio Provision for non-performing advances divided by gross non-performing advances Provisions to core operating profit Provisions and contingencies (excluding taxation) divided by core operating profit Return on average assets Net profit after tax divided by average assets Return on average equity Net profit after tax divided by average equity Risk weighted assets (RWAs) RWAs are computed by assigning risk weights as per the RBI Basel III guidelines to various on-balance sheet exposure and off-balance sheet exposures REGISTERED OFFICE CORPORATE OFFICE ICICI Bank Tower, Near Chakli Circle, Old Padra Road, Vadodara 390 007 CIN: L65190GJ1994PLC021012 ICICI Bank Towers, Bandra-Kurla Complex, Mumbai 400 051 STATUTORY AUDITORS M S K A & Associates Chartered Accountants 602, Floor 6, Raheja Titanium, Western Express Highway, Geetanjali Railway Colony, Ram Nagar, Goregaon East, Mumbai 400 063 KKC & Associates LLP Chartered Accountants (formerly Khimji Kunverji & Co LLP) Sunshine Tower, Level 19, Senapati Bapat Marg, Elphinstone Road, Mumbai 400 013 REGISTRAR AND TRANSFER AGENTS Equity Shares: KFin Technologies Limited Unit : ICICI Bank Limited, Selenium Building, Tower-B, Plot No. 31 & 32, Financial District, Nanakramguda, Serlingampally, Hyderabad 500 032, Rangareddy, Telangana Bonds/Debentures: 3i Infotech Limited International Infotech Park, Tower # 5, 3rd Floor, Vashi Railway Station Complex, Vashi, Navi Mumbai 400 703 OUR APPROACH TO REPORTING ABOUT THIS REPORT This is ICICI Bank’s Annual Report for the year ended March 31, 2024. It has been prepared in accordance with Indian regulatory reporting requirements as well as the principles of the International Integrated Reporting Framework. Through this report, the Bank aims to provide its stakeholders a comprehensive view of its operations, performance, its financial and non- financial resources and strategy to create long- term value. The report provides insights into the Bank’s primary activities, its strategic priorities, risks and mitigants, governance structure, and the manner in which it has leveraged the six capitals, namely Financial, Human, Intellectual, Manufactured, Social and Relationship, and Natural. REPORTING BOUNDARY The non-financial information in the integrated report largely covers the operations of ICICI Bank Limited. REPORTING PERIOD The Annual Report provides material information relating to the Bank's strategy and business model, operating context, performance and statutory disclosures covering the financial year April 1, 2023 to March 31, 2024. SAFE HARBOUR Certain statements in this release relating to a future period of time (including inter alia concerning our future business plans or growth prospects) are forward-looking statements intended to qualify for the 'safe harbor' under applicable securities laws including the US Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. These risks and uncertainties include, but are not limited to statutory and regulatory changes, international economic and business conditions, political or economic instability in the jurisdictions where we have operations, or which affect global or Indian economic conditions, increase in nonperforming loans, unanticipated changes in interest rates, foreign exchange rates, equity prices or other rates or prices, our growth and expansion in business, the adequacy of our allowance for credit losses, the actual growth in demand for banking products and services, investment income, cash flow projections, our exposure to market risks, changes in India’s sovereign rating, as well as other risks detailed in the reports filed by us with the United States Securities and Exchange Commission. Any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of the date of this release. ICICI Bank undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof. Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission. These filings are available at www.sec.gov Digiverse a one-of-its-kind BankTech space ICICI Bank launched Digiverse, a futuristic banking space, at its Service Centre in Bandra Kurla Complex, Mumbai. At Digiverse, customers and even non-customers can explore ICICI Bank’s rich history and legacy, and avail of the Bank’s products and services digitally. 24/7 Access Operates fully on green energy Relationship Manager (RM) available during banking hours A video calling facility to connect customer with RM even beyond banking hours ICICI Bank Limited, ICICI Bank Towers, Bandra-Kurla Complex, Mumbai 400 051 | www.icicibank.com facebook.com/icicibank twitter.com/icicibank youtube.com/icicibank linkedin.com/company/icici-bank instagram.com/icicibank

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