Bank of Baroda on Friday reported a marginal 2% rise in net profit to Rs 4,886 crore in the fourth quarter of FY24, weighed down by higher provisions for pension liabilities and grounded airline Go First. The lender surpassed Street expectations as Bloomberg analysts expected the bank to post Rs 4,534 crore net profit in the quarter. The bank made Rs 550 crore provision for Go First and Rs 400 crore for the pension liabilities during the quarter.
“We expect to grow deposits 10-12% and advances by 12-14 % in the current financial year,” said Debadatta Chand , MD & CEO, Bank of Baroda in an earnings call.
Net interest income, the difference between interest earned and paid, rose 2% to `11,793 crore in the fourth quarter from `11,525 crore in the same quarter of the previous fiscal. Net interest margin of the bank contracted to 3.27% in the fourth quarter from 3.53% in the year ago period.
Chand said the bank has been spending aggressively on the technology front, including around `2,000 crore investments on infrastructure alone, and will up the spends as the area comes under increased focus going ahead.
Replying to a question on the impact of the RBI restriction on BoB world app, Chand said the hit can be seen in challenges faced on the accretion of low cost current and saving account deposits, while overall transaction volumes were down 10 %.
The bank’s domestic deposits grew 7.7% year-on-year in Q4 to `11.28 trillion, while total domestic gross advances rose nearly 13% to `8.98 trillion in the quarter under review. Bank of Baroda’s retail advances, excluding pool purchase, registered a healthy growth of 20.7% from a year ago to `2.14 trillion.
On the asset quality side, the bank’s gross non-performing assets (NPAs) moderated to 2.92% of gross advances as of March 31, 2024, from 3.79 % at the end of March 2023.
Net NPAs also declined to 0.68 % of the advances, from 0.89% at the end of 2023. The bank’s capital adequacy ratio stood at 16.31%, as on March 31, up 7 bps from a year ago. The CET-I ratio came in at 12.54%.