Bank of Baroda Q1 results: Net profit rises 9.5% at Rs 4,458 crore

Public-sector lender Bank of Baroda’s net profit for the April-June quarter (Q1FY25) grew 9.5 per cent year-on-year (Y-o-Y) to Rs 4,458 crore on lower credit costs. The net profit was Rs 4,070 crore in the year-ago period.

Sequentially, the profit declined from Rs 4,886 crore in Q4FY24. Bank’s stocks closed 0.94 per cent lower at Rs 253.85 on Wednesday.

Net interest income (NII) expanded by 5.5 per cent to Rs 11,600 crore against Rs 10,997 crore in the quarter a year ago. Sequentially, NII declined from Rs 11,793 crore in Q4FY24, according to a press statement.

Net interest margin (NIM) fell by 9 basis points (bps) to 3.18 per cent Y-o-Y. NIM was flat at 3.27 per cent in Q4FY24.

In the post-result virtual media interaction, Bank of Baroda Managing Director and Chief Executive Officer Debadatta Chand said the lender had now got control on cost of deposits and reduced the dependency on bulk deposits. The bank has guided for NIM of nearly 3.15 per cent in FY25.

The non-interest income fell by 25.1 per cent to Rs 2,487 crore in Q1 from Rs 3,322 crore in the year-ago period.

The lender’s provisions for non-performing assets (NPAs) declined by 25 per cent to Rs 1,269 crore in the first quarter of FY25.

Advances grew 8.1 per cent Y-o-Y to Rs 10.71 trillion. Retail lending portfolio increased by 20.9 per cent to Rs 2.2 trillion. The corporate loan book expanded by 2.5 per cent Y-o-Y, according to a bank statement.

Total deposits increased 8.9 per cent to Rs 13.06 trillion. The share of low-cost deposits — current account and savings account (CASA) — improved marginally to 40.62 per cent in Q1FY25 from 40.33 per cent a year ago.

Chand said the overall loan book would grow at a pace of 12-14 per cent in FY25. The corporate portfolio loan book will grow 10-12 per cent. He, however, did not give the size of sanctioned corporate credit. 

The asset quality profile improved with gross NPAs declining to 2.88 per cent from 3.51 per cent in June 2023. Net NPAs also declined to 0.69 per cent.

“The bank was working to improve asset quality by reducing the gross NPAs to 2.5 per cent level. The recoveries from written-off accounts are expected to be Rs 600-700 crore per quarter,” he said.

The provisioning coverage ratio (PCR), including written-off accounts, improved to 93.32 per cent in June from 93.23 per cent in the year-ago month.

BoB’s capital adequacy ratio stood at 16.82 per cent with common equity Tier-I (CET1) capital at 13.08 per cent. The bank board has given a nod to raise up to Rs 7,500 crore through AT1 and Tier-II bonds to replace debt capital maturing this year.