Bank of Bar­oda Q2 net profit down 35%


Bank of Bar­oda (BoB) saw its net profit fall by 35.7 per cent to ~357 crore in the Septem­ber quar­ter due to a sharp rise in pro­vi­sions and con­tin­gen­cies. It had re­ported a net profit of ~552 crore in the year-ago quar­ter.

The pub­lic sec­tor lender said the bank would be fine even if cap­i­tal in­fu­sion by the govern­ment did not hap­pen.

The bank’s net in­ter­est in­come for the quar­ter rose 8.58 per cent to ~3,720 crore from ~3,426 crore in the cor­re­spond­ing pe­riod of the pre­vi­ous year. Other in­come, which in­cludes fees and com­mis­sions, rose 11.2 per cent to ~1,737 crore.

Its net in­ter­est mar­gin in the Septem­ber quar­ter im­proved to 2.31 per cent, from 2.12 per cent in the year-ago pe­riod and 2.12 in the pre­vi­ous June quar­ter. The bank’s as­set qual­ity im­proved as gross non­per­form­ing as­sets (NPA) ra­tio and net NPA ra­tio stood at 11.16 per cent and 5.05 per cent as on Septem­ber 2017, as against 11.35 per cent and 5.46 per cent, re­spec­tively, as on Septem­ber 2016.

Slip­pages were at ~3,451 crore at the end of Septem­ber quar­ter. Fresh slip­pages also de­clined sharply on a se­quen­tial ba­sis but were up from the year-ago quar­ter. “Go­ing for­ward we will be able to con­tain slip­pages and try to en­sure we have a bet­ter re­cov­ery fig­ure,” said Papia Sen­gupta, ex­ec­u­tive di­rec­tor at the bank. The Re­serve Bank of India’s au­dit of the bank’s ac­counts is over but the bank is still in dis­cus­sion with the reg­u­la­tor, said Jayaku­mar.

Pro­vi­sions and con­tin­gen­cies stood at ~2,32,935 crore as on Septem­ber 30. This was a rise of nearly 30 per cent against ~1,79,584 crore in the year-ago quar­ter. How­ever, the bank's pro­vi­sion­ing for NPAs in­creased only by 13 per cent.

The pub­lic sec­tor bank has 10 ac­counts in the first list of bad ac­counts with an ag­gre­gate ex­po­sure of ~7,694 crore and 18 ac­counts in the sec­ond list with ag­gre­gate ex­po­sure of ~4,274 crore. The bank's watch­list amounts to al­most ~10,000 crore.

The bank’s net in­ter­est in­come for the quar­ter rose 8.58 per cent to ~3,720 crore

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