BoB net falls 36% to Rs 355cr as bad loan provisions spike 26%

The second largest state-run lender Bank of Baroda today reported a 36 per cent plunge in net profit at Rs 355 crore in the quarter to September, driven down by higher provisions for bad loans.

Total provisions rose 25.68 per cent to Rs 2,687 crore in the quarter as against Rs 2,138 crore a year ago, while provisions for non-performing loans rose 13 per cent to Rs 1,847 crore from Rs 1,630 crore.

However, its gross NPA ratio improved to 11.16 per cent from 11.35 per cent, and so was the net NPA ratio which improved was at 5.05 per cent as against 5.46 per cent.
 

The core profitability gauge, net interest margin (NIM) for domestic operations declined to 2.68 per cent from 2.85 per cent a year ago.

"We feel positive about our ability to grow the balance sheet as far as NPA is concerned. We are working very hard and we feel that the NPA ratios will improve here onwards. We've to contain NPAs. A lot depends upon how the NCLT cases pan out," managing director PS Jayakumar told reporters.

Fresh slippages during the quarter rose to Rs 2,586 crore from Rs 2,252 crore, while recovery fell to Rs 909 crore from Rs 1,653 crore.

"We need to do more on recoveries," he said.

In the first list of stressed accounts which RBI has asked banks to refer to NCLT for resolution, BoB has exposure to 10 worth Rs 7,694 crore and has already made provision of Rs 3,983 crore. In the second list, it has exposure to 18 accounts worth Rs 4,274 crore.

On divergence, he said the audit has not come to an end and the discussions with the RBI is yet to take place.

In the run-up to the announcement, the BoB counter ended the day up 1.5 per cent at Rs 174.40 on the BSE whose main gauge ended the day 0.28 per cent down.

Bank's total business rose by 5.30 per cent to Rs 9,70,514 crore from Rs 9,21,681 crore. Total deposits stood at Rs 5,83,212 crore as against Rs 5,67,531 crore.

Total advances rose 9.36 per cent to Rs 3,87,302 crore from Rs 3,54,150 crore of which domestic credit grew 13.81 per cent driven by retail loans which jumped 25.49 per cent and within retail loans, home loan growth of 34.11 per cent.