Bank of Baroda reported its highest quarterly net profit in the fourth quarter at ₹4,775 crore on the back of robust growth in net interest income and sharp decline in loan loss provisions.

The public sector bank’s net profit in the reporting quarter soared 168 per cent year-on-year (y-o-y) from ₹1,779 crore in the year ago period.

The Bank’s board recommended a dividend of ₹5.50 per equity share of face value ₹2. Net interest income was up 34 per cent y-o-y to ₹11,525 crore (₹8,612 crore).

Loan loss provisions sharply declined by 94 per cent to ₹320 crore (₹5,200 crore).

Global NIM improved to 3.53 per cent from 3.08 per cent as at March-end 2022. Global advances increased by 18.5 per cent y-o-y to ₹9,69,548 crore. Global deposits rose 15.1 per cent to ₹12,03,688 crore.

Gross NPA position improved to 3.79 per cent of gross advances against 4.53 per cent in the preceding quarter. Net NPA position too improved to 0.89 per cent of net advances against 0.99 per cent in the preceding quarter.

“Retail loans have been the standout performer for us, growing by about 28 per cent yoy. Our strategy is that if our loan growth is ‘x’, retail and corporate loans should grow 1.5x and 0.7x, respectively. The numbers have panned out exactly on that basis. 

“In FY24, we expect 13-14 per cent credit growth. The corporate credit cycle continues to be very favourable. Here the credit cost is negligible. The recoveries we are getting are more than the slippages which are there,” said Sanjiv Chadha, MD & CEO.

He emphasised that delinquencies have been the lowest in the retail segment for a long time.

‘So, as we look ahead, the asset quality should improve as the loan composition changes (in favour of retail),’ Chadha said.

He emphasised that without going to the market for capital and despite paying 20 per cent of its profit as dividend, BoB’s year-end capital adequacy ratio (16.24

per cent) is better than what it was at the beginning of the year (15.68 per cent).

‘The domestic Credit-Deposit ratio is just about 75 per cent, which means there is plenty of room for us to grow our loans without being constrained by deposits in any manner whatsoever,’ said Chadha.

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