A STUDY ON CAPITAL STRUCTURE OF ICICIBANK

Abstract

The capital structure of a bank plays a pivotal role in determining its financial stability, risk exposure, and overall performance. This study focuses on analyzing the capital structure of ICICI Bank, one of India's leading private sector banks, to understand its composition, trends, and implications on profitability and risk. The research aims to evaluate the balance between debt and equity capital, assess the bank’s leverage ratios, and study the adherence to regulatory capital requirements over a period of five years (2020–2024). The study utilizes key financial metrics such as Debt-Equity Ratio, Capital Adequacy Ratio, Tier I and Tier II capital composition, and Return on Capital Employed (ROCE) to determine the effectiveness of ICICI Bank’s capital structure. Secondary data from annual reports and RBI publications have been used for the analysis. The findings reveal a consistent emphasis on maintaining optimal capital adequacy in line with Basel norms, ensuring a balance between financial growth and risk management. The study concludes with suggestions for improving capital structure strategies to enhance long-term sustainability and shareholder value