The net interest income (NII) grew by 7.3% YoY to Rs 11,622 crore in Q2FY25.
The significant growth in quarterly PAT was driven primarily by an increase in both NII and non-interest income.
The bank has consistently maintained a return on assets (ROA) exceeding 1%, with 1.30% for Q2FY25 and 1.20% for H1FY25 . Return on equity (ROE) reached 19.22% for Q2FY25 and 17.79% for H1FY25. Operating income saw robust growth of 12% YoY in Q2FY25, driven by a 24.2% YoY surge in non-interest income.
This growth in NII, coupled with a 24.2% YoY increase in non-interest income, fuelled the overall rise in the bank’s operating income, which stood at Rs 16,803 crore in Q2FY25, marking a 12% YoY increase.
The non-interest income was boosted by significant trading gains and recovery from written-off accounts.The bank’s gross non-performing asset (NPA) ratio improved to 2.50% in Q2FY25, down from 3.32% in Q2FY24. Net NPA ratio also improved, standing at 0.60% in Q2FY25, down from 0.76% in the same quarter last year.Its operating profit experienced an 18.2% YoY rise, reaching Rs 9,477 crore in Q2FY25. Bank of Baroda’s improved operational efficiency is evident from the reduced cost-to-income ratio, which dropped by 294 basis points YoY to 43.60% for Q2FY25.
The bank recorded substantial growth in its loan book, with global advances growing by 11.6% YoY to Rs 11,43,039 crore, and domestic advances increasing by 12.5% YoY to Rs 9,38,883 crore.
The organic retail advances grew significantly by 19.9% YoY, driven by high-focus areas like auto loans, home loans, mortgage loans, and education loans.
The agriculture loan portfolio expanded by 10.6% YoY, reaching Rs 1,44,508 crore, while the total gold loan portfolio, including retail and agriculture, saw a substantial increase of 24.7% YoY, amounting to Rs 54,736 crore. The bank’s MSME portfolio also witnessed an 11.7% YoY growth, touching Rs 1,26,828 crore.
The capital adequacy remains strong with a consolidated CRAR of 16.67% and a CET-1 ratio of 13.17% as of September 2024. This solid capital position reflects the bank’s ability to manage risks and support lending activities effectively.
The liquidity coverage ratio on a consolidated basis stands at a robust 123.7% approximately, indicating the bank’s strong ability to meet short-term obligations.
Gross NPA decreased significantly by 15.9% YoY, settling at Rs 28,551 crore in Q2FY25.
Provision Coverage Ratio remained strong at 93.61% (including TWO) and 76.31% (excluding TWO) in Q2FY25. The slippage ratio improved to 1.07% in Q2FY25 compared to 1.81% in Q2FY24. Credit cost remained below 1%, at 0.65% for Q2FY25 and 0.55% for H1FY25.
