In the second quarter of FY24, which concluded in September, Bank of Baroda (BoB) reported net profit of Rs 4,253 crore, an increase of 28.4% year over year (y-o-y).

From Rs 10,174 crore in the same period last year to Rs 10,831 crore in the second quarter, its net interest income (NII) increased by 6.5%.

In Q2 FY24, the bank’s net interest margin (NIM) decreased to 3.07 percent from 3.33 percent in Q2 FY23. The bank updated its forecast for NIMs for FY24, moving it from 3.3% to 3.5% (plus or minus five basis points). In a media call following the Q2 FY24 results, Debadatta Chand, the managing director and chief executive officer, stated that the revision in NIM guidance was brought about by a change in cost metrics (a rise in the cost of funds).

The amount of non-interest income, which includes commissions, fees, treasury income, and recoveries, increased from Rs 1,826 crore to Rs 4,171 crore in the second quarter of FY24.

The company increased its provisions for bad debt and non-performing assets (NPAs) from Rs 1,654 crore in the same time last year to Rs 2,285 crore in the second quarter.

In Q2 FY24, advances increased 17.3% year over year to Rs 10.24 trillion. Its retail credit portfolio increased to Rs 1.93 trillion, up 22.2%. A part of the retail book, its personal loan portfolio increased by 67.2% year over year to Rs 25,618 crore.

Chand states that although the increase in unsecured loans has created a great deal of anxiety inside the system, BoB‘s personal loan portfolio is steady and there isn’t much stress.

However, the bank will assess its portfolio and, in a sensible move, will slow the rate of loan growth in the personal loans section to about thirty percent.

Total deposits reached Rs 12.49 trillion, up 14.6% year over year. As of the end of September, the percentage of low-cost deposits, which include savings accounts and current accounts (Casa), was 38.28%, down from 39.57% in the same month last year.

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