ICICI Bank aims for 30-35 pct growth

By Devidutta Tripathy

MUMBAI (Reuters) - India's second-largest bank, ICICI Bank (ICBK.BO: Quote, Profile, Research, Stock Buzz) (IBN.N: Quote, Profile, Research, Stock Buzz), is aiming for growth of 30 to 35 percent over the next three years as strong economic growth underpins investment and corporate loan demand, its joint managing director said.

A $4.9 billion share sale this year -- the country's largest -- was sufficient to help meet that growth target, so the bank did not plan a return to the equity markets, said Chanda Kochhar, ICICI Bank's joint managing director and chief financial officer.

Still, ICICI, which braved jittery bond markets in September to raise $2 billion, will keep tapping global debt markets to fund lending, she told the Reuters India Investment Summit.

"We want to widen and diversify our investor base, so we don't just look at dollar investors. We did good issuances in the sterling and the euro market as well a few months ago. We would look at the Japanese market. So we would look across the globe," Kochhar said on Thursday.

"We would continue to raise a large amount of debt funds," she added.

Kochhar said consumer credit growth in India was expected to slow to between 10 to 15 percent, from 30 to 35 percent earlier, but borrowing from corporate clients would take up the slack, growing at a rate of 30 percent.

Kochhar expects ICICI Bank to grow faster than the broader financial sector.

"If the economy continues to grow at 9-10 percent or so, I think the financial sector would have a growth rate of about three times that ... We can expect the growth of 25-30 percent for the financial sector," she said.

ICICI Bank is India's largest private sector bank, with assets of $92 billion as of September. A market capitalization of $32 billion makes it India's most valuable bank, and it has the second-largest weighting in the benchmark stock index

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Shares in the bank were 2.4 percent up at 1,190 rupees at 0743 GMT in a Mumbai market that had gained 0.6 percent.

RATES, RUPEE

Kochhar said India's attraction to foreign investors meant the foreign fund inflows would persist. The flows, including more than $16 billion into the stock market so far this year, have complicated policy management for the authorities.

"Because we have a lot of foreign flows coming in, therefore I would think we would continue to take some measures for some time as a country to keep liquidity in the system under control." "Which would mean that interest rates won't come falling down substantially. But I don't see a reason for interest rates to go up."

The rupee has risen about 12 percent against this dollar this year to its strongest levels in almost 10 years, and central bank efforts to stem its rise have added to money supply growth.  Continued...