BoB Registers 26.1% Profit YoY In FY24, Aviation Account Fully Provided: Says CEO Chand

Bank of Baroda (BoB) net profit for financial year 2023-24 (FY24) stands at Rs 17,789 crore, showing a growth of 26.1 per cent year-on-year (YoY) as against Rs 14,110 crore in FY23. Net Profit for the quarter ending March 2024 (Q4 FY24) stands at Rs 4,886 crore, registering a growth of 2.3 per cent on a year-on-year (YoY) basis.

Bank of Baroda reported a 2.3 per cent growth in net income at Rs 4,886 crore for the March quarter YoY. However, an additional provision of Rs 550 crore for the bankrupt Goair and another Rs 800 crore for pensions have had a negative impact on the overall numbers.

The management led by chief executive Debadatta Chand told reporters, “We have made provisions for both Emergency Credit Line Guarantee Scheme (ECLGS) and non-ECLGS component. Now, the aviation account is fully provided. The legal processes are going on but this account is highly collateralised.”

One-third of the bank's exposure is covered by government guarantees under the ECLG scheme, Chand added.

The management did not provide exact figures for its annual IT expenditure, although it did mention that it has been increasing its IT budget over the past few years and will continue to do so in the future. This is noteworthy because the bank was previously banned by the RBI six months ago due to poor IT infrastructure for its mobile app BoB World. The ban was only lifted this past Wednesday.

The executive director, Sanjay Mudaliar, refused to quantify the impact of the ban on revenue. However, he did admit that the collection of Casa deposits was impacted to some extent.

Global advances of the bank increased to Rs 10,90,506 crore, above 12.5 per cent YoY. Domestic advances of the bank increased to Rs 8,98,116 crore, above 12.9 per cent YoY.

Global deposits increased by 10.2 per cent YoY to Rs 13,26,958 crore. Domestic deposits increased by 7.7 per cent YoY to Rs 11,28,514 crore in March 2024.
Domestic Casa deposits registered a growth of 5.4 per cent YoY and stood at Rs 4,66,401 crore as of 31 March 2024.

International deposits grew by 27 per cent on a YoY basis to Rs 1,98,444 crore in March 2024.
 
Organic Retail Advances grew by 20.7 per cent, led by strong growth across segments such as auto loans (23.8 per cent), home loans (14.1 per cent), personal loans (51.6 per cent), mortgage loans (11.4 per cent), education loans (19.6 per cent) on a YoY basis.

The agriculture loan portfolio grew by 11.6 per cent YoY to Rs 1,38,640 crore.
Total gold loan portfolio (including retail and agri.) stands at Rs 47,472 crore, registering a growth of 24.1 per cent on a YoY basis.

The gross non-performing assets (GNPA) of the bank reduced by 13.4 per cent YoY to Rs 31,834 crore in Q4 FY24 and the gross NPA ratio improved to 2.92 per cent in Q4 FY24 from 3.79 per cent in Q4 FY23.

The net NPA Ratio of the bank stands at 0.68 per cent in Q4 FY24 as compared with 0.89 per cent in Q4 FY23. The provision coverage ratio of the bank stood at 93.30 per cent.

The slippage ratio declined to 0.99 per cent for FY24 as against 1.07 per cent in FY23. The slippage ratio for the quarter stands at 1.12 per cent. Credit cost stands at 0.57 per cent for Q4FY24 and 0.67 per cent for FY24.

The capital-to-risk adequacy ratio (CRAR) of the bank stands at 16.31 per cent in March 2024. Tier-I stood at 14.07 per cent common equity tier-1 at 12.54 per cent, additional tier1 at 1.53 per cent and Tier-II stood at 2.24 per cent as of March 2024.