Bank of Baroda Q2 Results: Net profit drops 8% YoY to ₹4,809 crore; NIMs stable, asset quality improves

Bank of Baroda Q2FY26 Results: State-owned Bank of Baroda announced its financial results for the September quarter on October 31, post market hours, reporting an 8.2% year-on-year decline in net profit to ₹4,809 crore, compared with ₹5,238 crore in the same period last year, despite a sharp improvement in provisions.

The decline was primarily driven by a steep 32% drop in non-interest income, which fell to ₹3,515 crore from ₹5,166 crore a year ago. A sharp 36% year-on-year fall in treasury income to ₹1,086 crore weighed on the bank’s profitability.

Meanwhile, net interest income (NII) registered a modest increase of 2.7% YoY to ₹11,954 crore, up from ₹11,637 crore in Q2FY25, while the net interest margin remains stable on a QoQ basis at 3.10% but fell marginally by 17 basis points to 3.27%.

The rise in deposit and borrowing costs outpaced the growth in lending yields, exerting pressure on margins despite steady loan growth.

On the asset quality front, the bank reported an improvement, with the gross non-performing asset (GNPA) ratio easing to 2.16% from 2.50%, and the net NPA ratio improving slightly to 0.57% from 0.60%. The capital adequacy ratio strengthened to 16.54%, up 28 basis points year-over-year.

Additionally, provisions declined sharply by 47.2% YoY to ₹1,232 crore, providing some support to the bottom line. The operating profit before provisions came in at ₹7,576 crore, a 20.1% YoY drop over ₹9,477 crore in the September 2024 quarter.

Bank of Baroda share price trend

The bank’s shares have made a sharp recovery in recent months, gaining 41.3% over eight months, rising from ₹196 apiece to ₹278.40 apiece. During this period, the stock closed in positive territory for four out of eight months.

Although it has staged a strong comeback, the stock still trades about 7% below its record high of ₹299.70 apiece, touched in June 2024.

On a year-to-date basis, the stock has gained 16%, and if the momentum sustains through year-end, it will mark its fifth consecutive year of positive returns.

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