Bank of India (BoI) reported a 22 per cent year-on-year (YoY) decline in first quarter (Q1FY23) standalone net profit at ₹561 crore against ₹720 crore in the year-ago period.
The public sector bank’s bottom line was weighed down by an increase in loan loss provision and treasury loss.
Net interest income (difference between interest earned and interest expended) was up 29 per cent YoY at ₹4,072 crore (₹3,146 crore).
Other income, comprising recoveries in written-off accounts, commission or fee income, earnings from foreign exchange transactions, and profit and loss on sale of investments, among others., declined 50 per cent YoY to ₹1,152 crore (₹2,320 crore).
Net interest margin improved to 2.55 per cent against 2.16 per cent in Q1FY22.
The public sector bank booked a loss of ₹148 crore in treasury income due to rising bond yields. In the year-ago period, the treasury income was ₹880 crore.
Gross non-performing assets (GNPAs) declined to 9.3 per cent of gross advances as at June-end 2022, against 9.98 per cent as at March-end 2022. Net NPAs, too, eased to 2.21 per cent against 2.34 per cent.
Fresh slippages during the reporting quarter were higher at ₹2,465 crore (₹1,502 crore in the preceding quarter). Reduction in NPAs via recovery, upgradation and write-offs was higher at ₹4,024 crore (₹1,983 crore).
Loan loss provisions were up 49 per cent YoY at ₹1,304 crore (₹873 crore in Q1FY22).
Credit cost increased to 1.21 per cent in the reporting quarter against 0.95 per cent in the year-ago quarter.
Atanu Kumar Das, MD & CEO, said: “Credit growth is likely to continue as the year progresses. Resource mobilisation drive could thus come to the fore.
“We will continue to focus on credit growth with greater emphasis on RAM (retail, agriculture and MSME) advances. In the current year, advances are projected to grow by 10-12 per cent, with RAM growth expected to be higher, supported by tech-enablers. Corporate book will also be in focus for onboarding new customers.”
Das emphasised that the bank is eyeing minimum recovery of ₹2,500 crore per quarter. The GNPAs are expected to come down below 8 per cent by March-end 2022.
Global advances were up 15.20 per cent YoY, at ₹4,77,746 crore as at June-end 2022.
Retail advances were up 22.45 per cent; agriculture (16.40 per cent), MSME (7.96 per cent), corporate and others (4.55 per cent), and overseas (56 per cent).
Global deposits rose by 2.78 per cent YoY, at ₹6,40,734 crore.
Domestic current account, savings account deosits increased to 44.70 per cent as at June-end 2022, from 43.22 per cent as at June-end 2021.
The bank reported an 11 per cent decline in consolidated net profit at ₹658 crore (₹735 crore).