The second largest lender of the country, ICICI Bank is coming back to its base that is corporate lending, according to CEO Chanda Kochhar.

The bank had reached the top to be amongst the bank majors in the country in the last decade owing to the retail lending segment. But the number of defaults has taken such a big toll that the bank has been compelled to cut down on its unsecured retail loans and credit card portfolio. The rate of defaults has taken a steep rise, Ms. Kochhar said.

Ms. Kochhar said, "The whole credit atmosphere in the country changed in such a manner that the actual loss ratios turned out to be much higher than what everyone envisaged."

The bank has had no problems with sub prime mortgage loans. It has a strong home loan and car loan business which is showing regular growth. The bank has been affected by losses arising out of unsecured loans, Ms. Kochhar said.

The last decade saw the bank giving out credit cards and retail loans at a large rate. The default rate on credit cards has risen to 12% while the retail loan defaults rose to 8%. This has been the reason why ICICI has stopped its lifetime free credit card scheme.

Ms. Kochhar said, "At these high default rates, the whole business is not as viable." "It's not going up from here, but it's not going down either," she added.

According to her the retail loan portfolio of the bank has declined from 65% a few years back to 55% at present. It is likely to dip down to 50 % soon.

"Until the circumstances change and change customer behavior, this portfolio is going to continue to remain a little risky," she said.