 "Q1 results")
Bank of India’s net profit jumped by 176.5 per cent year-on-year (YoY) to Rs. 1,551 crore in the first quarter of the current financial year (Q1FY24) on the back of a rise in net interest income (NII).
The lender had reported a net profit of Rs. 561 crore in the same period a year ago.
The bank's net interest income (NII) increased 45 percent YoY to Rs. 5,915 crore. The net interest margin (NIM) rose 50 basis points to 3.37 per cent in Q1 against 2.87 percent in the year-ago quarter.
The bank’s non-interest income increased by 27 percent YoY to Rs. 1,462 crore in Q1FY24 against Rs. 1,152 crore for Q1FY23.
The gross non-performing assets (GNPA) for Q1 fell 22.14 per cent to Rs. 34,583 crore in Q1 from Rs. 44,415 crore a year ago.
Quarter-on-quarter (QoQ), the GNPA was down 8.23 per cent from Rs. 37,686 crore in Q4FY23.
The management is positive on the outlook.
“We expect credit growth of around 11-12 per cent during the current financial year,” said Rajneesh Karnatak, managing director and chief executive officer of Bank of India.
“We expect the GNPA ratio to contain below 6 per cent, and credit cost between 0.6-0.7 per cent. We aim at maintaining NIM above 3 per cent, thus ensuring sustainable growth in profit,” he said.
The domestic deposits of the bank increased 7.98 per cent YoY to Rs. 5.89 trillion between April and June. Share of current account and savings account (CASA) deposits went up by 7.56 per cent YoY to Rs. 2.6 trillion in the quarter. The CASA ratio stood at 44.52 per cent.
Domestic advances increased by 7.98 per cent YoY to Rs. 4.33 trillion.
“For our guidance of 11-12 per cent of credit growth, we will keep a conscious mix of RAM (risk assessment model) and corporate advances at a 55:45 per cent ratio. In the RAM sector, we will grow in retail, agriculture, and MSME book. The growth will be agnostic to any particular industry. On the deposit side, we are giving a guidance of around 10 percent of growth,” Karnatak said.
RAM advances of the bank increased by 11.75 per cent YoY, accounting for 55.39 per cent of the total advances in the quarter. The lender’s global business in Q1 reached Rs. 12.14 trillion with growth of 8.61 per cent YoY.
“In terms of international credit, we have a loan book of around Rs. 85,000 crore as on June 2023, which was at around Rs. 84,000 crore in March. Incremental growth has not been much because there were a lot of repayments during the quarter,” Karnatak said.
