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MUMBAI : Bank of Baroda (BoB) has kept its guidance of a faster growth in retail loans compared to its corporate portfolio this year, with total credit growth expected at 10-12%, said Sanjeev Chaddha, managing director and chief executive. BoB’s advances grew 15.7% from a year earlier in the June quarter with retail advances growing by 23.2% and corporate loans rising by 17.3%.

“We had guided the credit growth in the system to be 10-12%. We want to grow at system or better while keeping margins intact. On current evidence, we have grown better than that. We had a depressed first quarter last year. We could see something better than that," said Chaddha. “It makes sense to balance portfolio by faster growth in retail. Retail is spread across segments- home loans, car loans, education loans. There is a broad-based growth story to continue. Even as corporate loan picks up, retail growth should be faster than corporate growth," he added.

The state-run lender expects to recover bad loans worth 13,000 crore this fiscal, which would improve its credit cost to 1.25-1.5%. BoB’s asset quality improved to 6.26% at the end of June quarter from 6.61% in the March quarter. The bank saw fresh addition of bad loans worth 3,266 crore during the quarter. “In smaller loans, we are seeing steady recovery. The fact that slippages are coming down shows continued recovery in smaller accounts. That should add to credit quality. We are targeting recovery of 13,000 crore," said Chaddha.

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