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Saturday, August 5, 2023

Bank of Baroda profit soars 88% to Rs 4,070 crore in June quarter, misses estimate - CNBCTV18

Bank of Baroda's Q1 profit boosted by healthy interest income on the back of asset repricing and higher loan sales came in lower than CNBC-TV18 poll estimate of Rs 4,631.7 crore.

Bank of Baroda recorded a net profit of Rs 4,070.1 crore for the April to June 2023 quarter, 88.7 percent higher than Rs 2,168.1 crore in the corresponding quarter last fiscal, the public sector lender’s filings showed on August 5.

The bank’s profit boosted by healthy interest income on the back of asset repricing and higher loan sales, however, came in lower than CNBC-TV18 poll estimate of Rs 4,631.7 crore.

Bank of Baroda's net interest income (NII) grew 24.4 percent to Rs 10,997 crore, coupled with robust growth in non-interest income that grew 2.8 times. Analysts polled by CNBC-TV18 had projected NII to rise to Rs 11,644 crore in the first quarter of the fiscal.

The bank saw an improvement in its asset quality with reduction in gross non performing asset (GNPA) by 275 basis points to 3.51 percent and improvement in net NPA to 0.78 percent, down 80 bps. In absolute terms GNPA came down 33.8 percent to Rs 34,832 crore and the provision coverage ratio stood at 93.23.

The slippage ratio, the rate at which a good loan becomes stressed, declined to 1.05 percent as against 1.71 percent a year ago. A rise in slippage impacts banks' provisioning and net profit. Low or no slippage shows how well asset qualities are managed by the bank.

The cost of deposits during the quarter under review rose to 4.68 percent from 3.46 percent and the cost to income ratio came down to 45.36 percent from 54.81 percent, which excluding treasury improved by 168 bps to 47.41 percent.

The lender also reported that its sustained NII growth was buoyed by an 18 percent growth in advances coupled with a traction in net interest margins (NIM), which grew 25 basis points (bps) to 3.27 percent.

Global NIM stood at 3.27 per cent, an increase of 25 bps, while domestic NIM rose 34 bps to 3.41 per cent. This has had the yield on advances increasing to 8.40 per cent during the reporting quarter from 6.58 per cent in Q1FY23, the bank said in a statement.

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Bank of Baroda profit soars 88% to Rs 4,070 crore in June quarter, misses estimate - CNBCTV18
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