Bank of Baroda

Healthy loan growth, bottomline impacted by high credit cost and NII decline

Bank of Baroda has reported 2% growth in net profit at Rs 4541.36 crore for the quarter ended June 2025 (Q1FY2026). The bank has posted 1% decline in net interest income (NII), while the core fee income of the bank improved 10% in Q1FY2026. The Net Interest Margin (NIM) of the bank declined to 2.91% in Q1FY2026 compared to 3.18% in the corresponding quarter of previous year.

On business front, the bank as has posted 11% growth in business with strong 13% surge in loan book. The asset quality of the bank was stable in Q1FY2026. Bank has substantially improved the credit to deposit ratio to 84.1% at end June 2025 from 82.0% at end June 2024. However, the CASA ratio of the bank has declined to 32.7% at end June 2025 from 34.7% at end June 2024.

Asset quality stable: The bank has maintained stable asset quality in Q1FY2026.

The fresh slippages of loans stood at Rs 3686 crore in Q1FY2026 compared with 3159 crore in previous quarter and Rs 3018 crore in the corresponding quarter last year.

The recoveries of NPAs stood at Rs 750 crore, upgradations at Rs 810 crore and the write-off of loans was at Rs 2389 crore in Q1FY2026.

The standard restructured loan book of the bank stood at Rs 7242 crore end June 2025.

Provision coverage ratio was steady at 93.18% at end June 2025 compared to 93.29% a quarter ago and 93.32% a year ago.

The capital adequacy ratio of the bank stood at 17.6% with Tier I ratio at 15.2% at end June 2025.

The risk weighted assets of the bank has increased 10% YoY to Rs 858927 crore end June 2025,

Asset Quality Indicators: Bank of Baroda
	Jun-25	Mar-25	Dec-24	Sep-24	Jun-24	Variation
						QoQ	YoY
Gross NPA (Rs Crore)	27571.73	27834.88	28471.22	28551.20	30873.14	-1	-11
Net NPA (Rs Crore)	7157.55	6994.24	6825.06	6764.27	7231.53	2	-1
% Gross NPA	2.28	2.26	2.43	2.50	2.88	2	-60
% Net NPA	0.60	0.58	0.59	0.60	0.69	2	-9
% PCR	93.18	93.29	93.51	93.61	93.32	-11	-14
% CRAR - Basel III	17.61	17.19	15.96	16.26	16.82	42	79
% CRAR - Tier I - Basel III	15.15	14.79	13.44	14.18	14.65	36	50
Variation in basis points for figures given in percentages and in % for figures in Rs crore

Business Highlights:

Healthy business growth: The business of the bank has increased 11% YoY to Rs 2642690 crore end June 2025, driven by 13% surge in advances to Rs 1207056 crore. Deposits rose 10% to Rs 1435634 crore at end June 2025.

CASA deposits ratio ease: The domestic CASA deposits of the bank increased 6% YoY to Rs 473637 crore at end June 2025. The current account deposits increased 8% to Rs 72055 crore, while saving account deposits increased 5% to Rs 401582 crore end June 2025. The domestic CASA ratio eased to 39.3% at end June 2025 compared to 40.3% at end June 2024, while declined from 40.0% a quarter ago. The term deposits have increased 10% to Rs 730646 crore end June 2025. Overseas deposits have increased 15% to Rs 231351 crore end June 2025.

Strong loan growth: Advances growth was driven by retail loans rising 18% YoY to Rs 261479 crore at end June 2025, while credit to agriculture increased 16% to Rs 161764 crore and MSME 13% to Rs 135660 crore at end June 2025. The corporate credit has moved up 8% to Rs 432461 crore end June 2025. The overseas credit has jumped 14% to Rs 215693 crore end June 2025.

Investment book of the bank was flat YoY at Rs 375051 crore at end June 2025. The SLR book declined 2% to Rs 296270 crore, while non SLR book increased 8% to Rs 63464 crore at end June 2025. The AFS book increased 12% to Rs 87143 crore, while HTM book declined 4% to Rs 256877 crore at end June 2025. The duration of the overall investment portfolio stood at 3.88 years end June 2025 compared with 4 years at end June 2024.

Margins improve: The bank has shown 1 bps YoY decline in cost of deposits to 5.05%, while yield on advances dipped 46 bps YoY to 8.09% in Q1FY2026. Thus, the NIM has fell 27 bps YoY and 7 bps qoq to 2.91% in Q1FY2026.

Book value of the bank stood at Rs 256.1 per share at end June 2025, while the adjusted book value (net of NNPA and 25% of restructured advances) was Rs 238.8 per share at end June 2025.

Quarterly Performance

NII decline as NIM dip: Bank has recorded 5% increase in the interest earned at Rs 31091.49 crore, while interest expenses increased 9% to Rs 19656.71 crore in Q1FY2026. NII fell 1% to Rs 11434.78 crore in the quarter ended June 2025.

Healthy growth in the core fee income: Bank has posted 10% growth in core fee income to Rs 1622 crore, while the recoveries and other income jumped 14% to Rs 634 crore and forex income 68% to Rs 347 crore. Further, the treasury income zoomed 2035% to Rs 1879 crore, leading to 88% surge in the overall non-interest income to Rs 4674.53 crore in the quarter ended June 2025.

Expenses ratio improves: The operating expenses of the bank increased 14% to Rs 7872.84 crore, as other expenses moved up 22% to Rs 3565.12 crore, while employee expenses increased 7% to Rs 4307.72 crore in Q1FY2026. Cost to income ratio improved to 48.9% in Q1FY2026 compared with 49.2% in Q1FY2025, helping the Operating Profit to increase 15% to Rs 8236.47 crore.

Provisions and contingencies jump: The bank has shown 95% jump in provisions to Rs 1966.94 crore. The loan loss provisions galloped 33% to Rs 1686 crore, while investment provisions fell rebounded to Rs 86 crore and standard asset provisions to Rs 324 crore. The other provisions dipped 39% to Rs 43 crore.

Effective tax rate was steady at 27.6% in Q1FY2026 from 27.5% in Q1FY2025. Net Profit rose by 2% YoY to Rs 4541.36 crore during quarter ended June 2025.

Financial Performance FY2025:

Bank has posted 10% increase in net profit to Rs 19581.15 crore in the year ended March 2025 (FY2025). The net interest income increased 2% to Rs 45658.68 crore, while non-interest income moved up 15% to Rs 16647.33 crore, pushing up net total income by 5% to Rs 62306.01 crore in FY2025. The operating expenses increased 6% to Rs 29871.38 crore, while provision and contingencies declined 2% to Rs 5980.25 crore, allowing profit before tax to increase 6% to Rs 26454.38 crore in FY2025. The cost-to-income ratio rose to 47.9% in FY2025 compared to 47.7% in FY2024. An effective tax rate declined to 26.0% in FY2025 compared to 28.5% in FY2024. The net profit has increased 10% to Rs 19581.15 crore in FY2025.

Bank of Baroda: Results
Particulars	2506 (3)	2406 (3)	Var %	2503 (12)	2403 (12)	Var %
Interest Earned	31091.49	29628.70	5	121441.64	112605.94	8
Interest Expended	19656.71	18028.63	9	75782.96	67884.41	12
Net Interest Income	11434.78	11600.07	-1	45658.68	44721.53	2
Other Income	4674.53	2487.25	88	16647.33	14495.37	15
Net Total Income	16109.31	14087.32	14	62306.01	59216.90	5
Operating Expenses	7872.84	6926.06	14	29871.38	28251.68	6
Operating Profits	8236.47	7161.26	15	32434.63	30965.22	5
Provisions & Contingencies	1966.94	1010.67	95	5980.25	6075.61	-2
Profit Before Tax	6269.53	6150.59	2	26454.38	24889.61	6
EO	0.00	0.00	-	0.00	0.00	-
PBT after EO	6269.53	6150.59	2	26454.38	24889.61	6
Provision for tax	1728.17	1692.44	2	6873.23	7100.83	-3
PAT	4541.36	4458.15	2	19581.15	17788.78	10
EPS*(Rs)	35.1	34.4		37.8	34.4
Equity	1035.5	1035.5		1035.5	1035.5
Adj BV (Rs)	238.8	204.1		229.0	187.9
* EPS and Adj BV are calculated on diluted equity as given for each year. Face Value: Rs 2, Figures in Rs crore
Source: Capitaline Corporate Database

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