Merger with Vijaya, Dena more a bane than a boon for Bank of Baroda

Elevated slippages, weak asset quality and a near-stagnant loan growth don't bode well for investors

Mergers take time for results to get reflected in the books. In the case of banks, the timeline could be stretched further given the unpredictable nature of asset quality. This held true for Bank of Baroda’s (BoB’s) September quarter (Q2) results too.

With the management being focused towards integration of the merged entity, BoB posted the weakest show by any bank in Q2. Loans grew a mere 2 per cent, as the bank worked towards reducing its corporate loan book.

The unnerving factor, though, was that of asset quality. The metric showed little signs of easing in the case of BoB, a