ET: BoB posts 4-fold rise in Q3 net on loan growth

30 January 2019: Bank of Baroda’s net profit quadrupled in the third quarter ended December 2018 compared to a year ago due to strong growth in retail loans and an improvement in asset quality. The net profit stood at Rs 471 crore during the quarter, up from Rs 111 crore in the year-ago period.

Domestic advances grew by 21 per cent to Rs 3.5 lakh crore from Rs 2.9 lakh crore in previous year quarter led by 32.5 per cent growth in retail loans.

The bank has set aside Rs 3,416 crore as provisions for non-performing assets (NPAs) up 8 per cent from the year-ago period.

However, this included Rs 919 crore of excess provisions which managing director P Jayakumar said was to deal with uncertainties with regards to existing standard loan exposures.

“We think there are some prevailing uncertainties with respect to the telecom sector and have set aside Rs 919 crore as precautionary cover for future uncertainty in the asset,” Jayakumar said.

Despite the increase in provisions credit costs decreased to 2.92 per cent of the loan book from 3.04 per cent a year earlier. The bank expects to recover Rs 1,200 crore from NCLT resolutions in the final quarter of the year. “We expect one or two accounts including Bhushan Power and Steel to be resolved by the next quarter. The latest Supreme Court verdict upholding the insolvency code is a positive and we believe that it will help fast track these cases,” Jayakumar said.

The bank’s provision coverage ratio for exposure to the 40 companies listed in the first and second list of the NCLT cases came at 72.6 per cent and 76.1 per cent respectively.

Total fresh slippages during the quarter stood at Rs 2,933 crore mainly on account of Rs 1,169 crore exposure in debt-laden IL&FS.

Gross NPA stood at Rs 53,184 crore, or 11.01 per cent to the total advances, down from 11.78 per cent in year-ago period. The net NPA ratio also declined marginally to 4.26 per cent of total advances from 4.86 per cent.

The Economic Times reported



Categories: General News, Indian Earnings

Tags: ,

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: