BoI net rises 26% on improved recovery efforts

Public sector lender Bank of India (BoI) on Monday reported a net profit of Rs 786 crore…

Public sector lender Bank of India (BoI) on Monday reported a net profit of Rs 786 crore, up 26% y-o-y, for the quarter ended September 30. Net profit was aided by an increase in net interest income and increased recovery efforts.

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Asset quality worsened in  the quarter and gross non-performing assets (NPAs) stood at Rs 14,127 crore, up 41.55% y-o-y. As a ratio, gross NPAs stood at 3.54% of gross advances, up 26 bps from the preceding quarter. Net NPA ratio stood at 2.32%, up 18 bps over the preceding quarter. Slippages in the quarter were Rs 2,971 crore, of which about Rs 1,300 crore of restructured accounts slipped into the NPA category, said bank’s chairman and managing director VR Iyer. The lender said it would bring down the gross NPA ratio to 3% for the rest of the year.

Net interest income (NII) grew 20% y-o-y to Rs 2,527 crore while other income degrew 8.55% y-o-y to Rs 1,006 crore. Bank of India’s chief financial officer Anant Upadhyay attributed the de-growth in non-interest income to lower recovery from written off accounts. In the quarter, recovery from the written off accounts was Rs 104 crore, down 69.94% y-o-y.

“However, the commission exchange and brokerage business showed a growth of 13.11% to Rs 397 crore and a profit from the sale of investments showed a growth of 150.82% y-o-y to Rs 153 crore,” Upadhyay added. As a consequence, domestic net interest margins (NIMs) stood at 2.73%, down eight basis points (bps) from a year ago.

Sales to asset reconstruction companies (ARCs) were around Rs 106 crore compared to Rs 1,539 crore in the preceding quarter.

Global advances increased to Rs 3,99,288 crore, registering a growth of 18.55% y-o-y. Global deposits grew 19.93% y-o-y to Rs 5,18,432crore. Current and savings account (Casa) deposits rose 12.27% y-o-y to Rs 1,07,587 crore and the share of Casa deposits of total deposits is 28.40%.

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