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Bank of Baroda Q1 profit tanks 52%; gross NPA spikes to 11.4%, slippages surge

Moneycontrol News

Bank of Baroda’s first quarter earnings missed analysts’ estimates on Friday as profit fell 52 percent to Rs 203.4 crore compared with same quarter last year. It was impacted by higher provisions and tepid net interest income & non-interest income growth.

Net interest income during the quarter increased 1 percent year-on-year to Rs 3,405 crore, with loan growth of 4 percent Rs 3.77 lakh crore.

Domestic net interest margin for the quarter stood at 2.48 percent and global net interest margin at 2.12 percent.

Total deposits grew by 1.5 percent to Rs 5.7 lakh crore, with domestic deposits growth of 10.66 percent and CASA ratio at 38.77 percent (against 33.83 percent YoY).

Profit was expected at Rs 459.3 crore and net interest income at Rs 3,519.6 crore for the quarter, according to average of estimates of analysts polled by CNBC-TV18.

Asset quality deteriorated further in Q1 as gross non-performing assets (NPA) increased 94 basis points sequentially to 11.4 percent and net NPA rose 45 basis points to 5.17 percent.

In absolute terms, gross as well as net NPA jumped 8 percent each to Rs 46,173 crore and Rs 19,519 crore QoQ, respectively.

Slippages during the quarter increased to Rs 5,200 crore (from Rs 4,077 crore in Q4FY17), which was much higher than analysts’ average estimates of around Rs 3,500 crore.

Provisions for bad loans increased 18.2 percent to Rs 2,368 crore compared with same quarter last year but declined 10 percent on sequential basis.

Provision coverage ratio during the quarter declined to 66.3 percent, from 66.8 percent in year-ago quarter.

Bank of Baroda said other income increased 7.4 percent to Rs 1,551 crore but operating profit fell 0.79 percent to Rs 2,648 crore YoY.

The stock price closed down 3.91 percent at Rs 142.55 ahead of earnings that announced after market hours.