 "BoB net down 68% to Rs 334 cr")
Government-owned Bank of Baroda’s net profit for the December quarter dipped 68 per cent from a year earlier to Rs 333.9 crore, on a higher provision for bad loans and one-time tax expenses for its Gulf operations. It had a net profit of Rs 1,047 crore in October-December 2013. On the BSE exchange, its stock fell 11 per cent to close at Rs 193. Saday Sinha, banking analyst, Kotak Securities, said their non-performing assets (NPAs) were higher by any standard.
Net interest income for the quarter rose 7.5 per cent to Rs 3,286 crore from Rs 3,057 crore in the same quarter a year before. The net interest margin was 2.2 per cent.
Ranjan Dhawan, executive director, said though operating profits rose despite macro headwinds, the net profits were down due to significant increase in tax and non-tax provisions (money set aside for NPAs and restructured advances). Gross NPAs were 3.85 per cent of the total at end-December, reflecting continued stresses in the economic environment and the ongoing structural issues.
The amount set aside for NPAs grew 65.7 per cent to Rs 1,262 crore. The provision coverage ratio was was 62.37 per cent at end-December 2014. The amount set aside for the tax bill rose by 99.6 per cent to 743 crore. Of this, Rs 375 crore was for tax paid for bank operations in UAE, pertaining to earlier years (beginning 2007). An appeal against the tax ruling was in vain, Dhawan said.
Total deposits rose 12.1 per cent to Rs 564,600 crore as at end-December. Total advances rose 11.7 per cent to Rs 393,631 crore.
Bank has decided to calibrate loan growth to 11 per cent for the current financial year, keeping in mind the economic slump, said Dhawan.
Net interest income for the quarter rose 7.5 per cent to Rs 3,286 crore from Rs 3,057 crore in the same quarter a year before. The net interest margin was 2.2 per cent.
Ranjan Dhawan, executive director, said though operating profits rose despite macro headwinds, the net profits were down due to significant increase in tax and non-tax provisions (money set aside for NPAs and restructured advances). Gross NPAs were 3.85 per cent of the total at end-December, reflecting continued stresses in the economic environment and the ongoing structural issues.
The amount set aside for NPAs grew 65.7 per cent to Rs 1,262 crore. The provision coverage ratio was was 62.37 per cent at end-December 2014. The amount set aside for the tax bill rose by 99.6 per cent to 743 crore. Of this, Rs 375 crore was for tax paid for bank operations in UAE, pertaining to earlier years (beginning 2007). An appeal against the tax ruling was in vain, Dhawan said.
Total deposits rose 12.1 per cent to Rs 564,600 crore as at end-December. Total advances rose 11.7 per cent to Rs 393,631 crore.
Bank has decided to calibrate loan growth to 11 per cent for the current financial year, keeping in mind the economic slump, said Dhawan.