Bank of Baroda reports 23% increase in Q2FY25 net profit at ₹5,238 cr

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Bank of Baroda reported a 23 per cent year-on-year (yoy) increase in the second quarter (Q2FY25) standalone net profit at ₹5,238 crore on the back of moderate growth in net interest income and robust growth in non-interest income even as it increased provisioning for standard assets.

The public sector bank revised downwards credit and deposit growth projections for FY25. BoB had reported a net profit of ₹4,253 crore in the year ago quarter (Q2FY24).

Debadatta Chand, MD & CEO, BoB, said: “We had earlier projected a credit growth of 12-14 per cent for FY25. But because of lower liability growth, we have reduced credit growth guidance to 11-13 per cent.

“Similarly, we have reduced deposit growth guidance from 10-12 per cent to 9-11 per cent. At the same time, we are keeping the margin guidance intact at 3.15 per cent (+/- 5 basis points). We want to calibrate credit growth with deposit growth. We expect moderation in deposit cost in Q3 and Q4.”

Net interest income

Net interest income/NII (difference between interest earned and interest expended) was up about 7 per cent y-o-y at ₹11,622 crore ( ₹10,831 in Q2FY24).

Total non-interest income, comprising fee income (loan processing charges, miscellaneous fee income, etc), forex income, profit or loss on sale/revaluation of investments, and recovery from technically written-off accounts, etc, rose about 24 per cent to ₹5,181 crore ( ₹4,171 crore).

Provisions for standard assets rose to ₹336 crore against write-back of ₹360 crore in the year ago quarter. Provisions for bad loans & bad debts written-off declined 24 per cent to ₹1,733 crore ( ₹2,285 crore). Provision for non-performing investment rose 33 per cent to ₹122 crore (₹92 crore).

Asset quality improved, with gross non-performing assets (NPAs) declining to 2.5 per cent of gross advances as at September-end 2024 against 3.32 per cent as at September-end 2023. NNPAs nudged lower to 0.6 per cent of net advances from 0.76 per cent.

Net interest margin edged up to 3.10 per cent in the reporting quarter against 3.07 per cent in the year ago quarter.

As on March-end 2024, global advances increased by 11.6 per cent y-o-y to ₹11,43,039 crore. Global deposits were up 9.1 per cent to ₹13,63,486 crore.