Bob Net Falls 22% In Q2

Bank of Baroda (BoB) has reported a 22.27 per cent slide in its net profit at Rs 98.44 crore in the second quarter ended September 30, 2001, as against Rs 126.64 crore earned in the corresponding quarter in the previous year.

However, in the half-year ended September 30, 2001, the bank recorded a 1.08 per cent rise in net profit at Rs 281.05 crore, up from Rs 278.02 crore in the corresponding period of the previous financial year.

Operating profit, however, showed a 10.94 per cent jump in the first half -- from Rs 550.45 crore to Rs 610.65 crore.

The bank has reported a 7.68 per cent fall in operating profit in the reporting Q2 at Rs 248.04 crore as against Rs 268.67 crore recorded in the same quarter in the previous year. Interest earned/ operating income of the bank in the reporting quarter was virtually flat at Rs 1,472.97 crore (Rs 1,467.92 crore in Q2 of 2000-01), while the other income shot up by 104.70 per cent to Rs 254.07 crore (Rs 124.12 crore).

Interest expended rose by 5.87 per cent to Rs 1057.09 crore (Rs 998.47 crore) and the operating expenses increased by 29.86 per cent to Rs 421.91 crore (Rs 324.90 crore). Provisions and contingencies made by BoB stood at Rs 123.60 crore (Rs 142.03 crore).

BoB chairman and managing director P S Shenoy said the net profit of the bank could have been higher but for the Rs 87.50 crore provisioning made in the reporting quarter towards the voluntary retirement scheme.

BoB's capital adequacy ratio (CAR) as on September 30, 2001 stood at 12.30 per cent as against 12.10 per cent as on September 30, 2000. Net non-performing assets (NPA) ratio stood 6.34 per cent as on September 30, 2001 as against 6.77 per cent as on March 31, 2001. The bank said that the improvement on the NPA front was due to the higher cash recoveries and upgradation of NPA accounts, amounting to Rs 257 crore during the first six months of the financial year.

The average cost of deposits in India has been brought down by the bank from 7.22 per cent in March 2001 to 6.97 per cent in September 2001.

Declining interest rate scenario pulled down the yields on the bank's advances as well as investments, BoB said. However, the falling yields were duly compensated by appreciating investment portfolio and the bank could book higher profits from the sale of investments.

On the issue of amalgamating the Benares State Bank (BSB) with BoB, Shenoy said an offer letter had been sent to the RBI a couple of weeks ago. BoB is willing to take over the BSB after undertaking proper due diligence, provided the Deposit Insurance Credit Guarantee Corporation makes good the losses suffered by the Benares State Bank.

The bank said its total income from treasury operations increased by 18.80 per cent on a year-on-year basis and accounted for 44 per cent of the total income from domestic operations for the first half of the current year.

Global deposits of the bank at Rs 58,936 crore as of September 30, 2001 showed an year-on-year growth of 10.47 per cent. Net credit of BoB stood at Rs 29,304 crore as of September 30, 2001 showing a half yearly growth of 6.87 per cent as compared to a negative growth of 0.09 per cent recorded during the first half of 2000-01.