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ICICI Bank is hiring less Employees to reduce Expenses and increase Growth


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ICICI Bank, the second-largest private bank, is planning to slow down its hiring growth in the upcoming quarters. This decision comes after a significant increase in employee numbers in the past few years.

Decrease in Employee Addition

In the third quarter, ICICI Bank added around 1,700 employees, a notable reduction compared to the 10,000 employees hired in the first half of the current financial year. This slowdown in employee addition has contributed to a decrease in operating expenses for the bank.

Insights from ICICI Bank’s CFO

Anindya Banerjee, the Group Chief Financial Officer of ICICI Bank, mentioned in an analyst call that the bank is unlikely to continue adding employees at the same rapid pace. This strategic shift will impact the bank’s operating expenses in the future.

Current Employee Count and Future Hiring Plans

As of December 31, 2023, ICICI Bank had a total of about 141,000 employees, with an increase of approximately 23,600 in the last 12 months. However, the bank anticipates a moderation in the pace of hiring in the coming quarters, deviating from the trend of the past few years.

Impact on Annual Growth Figures

The reduced hiring in the third and current quarter is expected to affect the bank’s annual growth figures. In FY23, ICICI Bank recorded a 21% growth in employee addition compared to the previous fiscal year. The management’s guidance indicates a slowdown in hiring, suggesting that the growth may not match that of the previous year.

Financial Implications and Market Response

Anindya Banerjee highlighted that the bank’s operating expenses increased by 22.3% year-on-year in the current quarter, with employee expenses rising by 30.5%. Despite this, ICICI Bank’s shares reached a record high of Rs 1,059.4, driven by strong third-quarter profits and meeting expectations in loan growth and margins. The stock experienced a 2% gain, closing at Rs 1,029.

Comparison with HDFC Bank’s Performance

ICICI Bank’s performance contrasts with that of HDFC Bank, where shares declined nearly 14% over the past five sessions. HDFC Bank faced challenges such as declining margins due to rising deposit costs and intense competition in the market.

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