Bank of Baroda Q2 results: Net profit at ₹1,679 crore, NII rises 6.8%1 min read . Updated: 29 Oct 2020, 02:50 PM IST
Asset quality has been improved with gross non-performing assets as a provision of gross advances falling to 9.14% in Q1FY21 against 9.39% in the June quarter
Public sector lender Bank of Baroda on Thursday posted a net profit of ₹1,679 crore for the quarter ended on 30 September due to lower provision. The lender reported a net loss of ₹864.3 crore for the June quarter. Net interest income (NII) during the quarter grew by 6.8% to ₹7,508 crore. The consolidated net profit stood at ₹1,771 crore in the September quarter.
The bank posted a operating profit of 5,552 crore, an increase of 4% year-on-year, for the quarter under review.
Global advances increased by 5.3% led by domestic organic retail and agriculture loans which grew by 16.81% and 16.52% respectively, the bank said in the regulatory filing. The auto loans grew by 34.8% year-on-year.
"Retail sanctions and disbursements in Q2FY21 are at 119% of last year’s level compared with 37% in Q1FY21 indicating a broad normalization of economic activity," the bank further added.
Provisions in the September quarter declined sharply to ₹3,001.59 crore on a quarter-on-quarter basis. Of these, provisions for NPA stood at ₹2,277.25 crore. In Q2FY20, provisions stood at ₹4,209.16 crore.
Provisions and contingencies for the June quarter declined sharply to ₹3,002 crore, compared to ₹5,628 crore in the June quarter. Of these, provisions for NPA stood at 2,277 crore.
"In accordance with the RBI guidelines, the bank was required to make provisions of not less than 10 per cent of the outstanding advances in respect of borrower account where asset classification benefit has been granted. However, the Bank had made provision at 20 per cent in March 31, 2020 while w.e.f. April, 2020 provision at 10 per cent is made wherever the said benefit is extended to the borrowers," the management said in a statement.
Asset quality has been improved with gross non-performing assets as a provision of gross advances falling to 9.14% in Q1FY21 against 9.39% in the June quarter. Net NPA fell to 2.51% from 2.83% quarter-on-quarter.
Provisioning coverage ratio (including floating provision) improved to 85.35% as on September 2020, compared to 83.30% as in March 2020. COVID-19 related provision stood at ₹1,748 crore, the bank added.
Domestic CASA ratio increased to 39.78%, up by 190 bps year-on-year. Domestic cost of deposits in Q2FY’21 is lower at 4.42%, a decline of 53bps quarter-on-quarter, the bank mentioned. Capital adequacy (CRAR) stood at 13.26% with CET-1 at 9.21% on a standalone basis.