Bank of Baroda (BoB) is back in the black in the first quarter of FY22, reporting a standalone net profit of ₹1,209 crore on the back of robust growth in other income and decline in provisions towards bad loans and standard assets.

The public sector bank had reported a net loss in both the year ago quarter (₹864 crore) and the preceding/ Q4FY21 quarter (₹1,046 crore). NIM improvesNet interest income (difference between interest earned and interest expended) was up 16 per cent year-on-year at ₹7,892 crore (₹6,816 crore in the year ago quarter).

Other income, comprising commission, exchange & brokerage, treasury income and recoveries in written-off accounts, jumped 63 per cent yoy to Rs 2,970 crore (Rs 1,818 crore).

Sanjiv Chadha, MD & CEO, said “The operating profit has shown a very sharp uptick, moving up nearly 41 per cent (to ₹5,707 crore). With the provisioning also contained, the net profit moved up to more than ₹1,200 crore.”

“.…The asset quality has been fairly resilient, with sequential lowering of gross NPAs as well as net NPAs by a tad. The improvement in the corporate credit cycle should benefit the bank as we forward.”

Global net interest margin improved to 3.04 per cent in the Apri-June quarter against 2.52 per cent in the year ago period.

Provisions, including towards bad loans and standard assets, declined 23 per cent yoy to ₹4,112 crore (₹5,349 crore).

The Bank made additional provision of ₹373 crore during the quarter ended June 30, in compliance with RBI’s June 7, 2019, circular on “Prudential Framework for Resolution of Stressed Assets issued guidelines for implementation of Resolution Plan”.

Slippages were lower at ₹5,129 crore in the reporting quarter against ₹11,655 crore in the preceding quarter. The slippages came mainly from MSME (42.5 per cent of the slippages), retail (24 per cent),and agriculture (21 per cent).NPAs declineGross non-performing assets (GNPAs) declined by ₹3,642 crore during the reporting quarter to stand at ₹63,029 crore as at June-end 2021. The Bank recovered ₹530 crore from the defunct Kingfisher Airlines account.

Gross NPA position improved a tad to 8.86 per cent of gross advances as at June-end 2021 against 8.87 per cent as at March-end 2021.

Net NPA position too improved to 3.03 per cent of net advances as at June-end 2021 against 3.09 per cent as at March-end 2021.

Global deposits declined a shade (0.34 per cent yoy) to ₹9,31,317 crore. However, the proportion of low-cost current account, savings account (CASA) increased to 43.21 per cent of domestic deposits against 39.49 per cent in the year ago quarter.

Global gross advances were down 3.40 per cent yoy to ₹7,11,487 crore, with retail advances growing about 12 per cent, agriculture about 9 per cent and MSME about 7 per cent. However, corporate advances contracted about 12 per cent yoy.

Bank of Baroda (BoB) is back in the black in the first quarter of FY22, reporting a standalone net profit of ₹1,209 crore on the back of robust growth in other income and decline in provisions for bad loans.

The public sector bank had reported a net loss in both the year ago quarter (₹864 crore) and March quarter (₹1,046.50 crore).

Net interest income (difference between interest earned and interest expended) was up 16 per cent year-on-year at ₹7,892 crore (₹6,816 crore in the year-ago quarter).

Other income, comprising commission, exchange & brokerage, treasury income and recoveries in written-off accounts, jumped 63 per cent yoy to ₹2,970 crore (₹1,818 crore).

Provisions, including towards bad loans, declined 23 per cent yoy to ₹4,112 crore (₹5,349 crore).

Additional provision

The bank said it has made additional provision of ₹373 crore in June quarter in compliance with RBI’s June 7, 2019 circular on “Prudential Framework for Resolution of Stressed Assets issued guidelines for implementation of Resolution Plan”.

Gross non-performing assets (GNPAs) declined by ₹3,642 crore during the reporting quarter to ₹ 63,029 crore as of June-end.

Gross NPA position improved a tad to 8.86 per cent of gross advances as at June-end 2021 against 8.87 per cent as at March-end 2021.

Net NPA

Net NPA position too improved to 3.03 per cent of net advances as at June-end 2021 against 3.09 per cent as at March-end 2021.

The number of borrower accounts where modification (restructuring) were sanctioned as per RBI’s circular (May 5, 2021) circular on “Resolution Framework - 2.0: Resolution of Covid-19 related stress of individuals and small business” was sanctioned and implemented stood at 8,544 and the aggregate exposure to such borrowers was ₹665 crore.

The bank has purchased PSLC (Priority Sector lending Certificates) of ₹3,500 crore under the category of Small and Marginal Farmer and sold PSLC of ₹1,000 crore under the category Micro Enterprises during the current quarter.

Deposits declined a tad (0.34 per cent yoy) to ₹9,31,317 crore. Advances were down 2.66 per cent yoy to ₹6,68,382 crore.

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