- Bank of Baroda's Q1 net profit dropped 71.9% to Rs 1,278 crore year-on-year
- The bank recorded a one-time loss of Rs 5,680 crore in the quarter ended June
- Net interest income rose 9.5% to Rs 12,525 crore, supported by lending growth
Bank of Baroda reported a sharp decline in first-quarter profit after booking a one-time loss of Rs 5,680 crore, even as net interest income (NII) and interest income registered healthy year-on-year growth.
The public sector lender posted a net profit of Rs 1,278 crore for the quarter ended June, down 71.9% from Rs 4,541 crore in the corresponding quarter last year.
The steep decline in profitability was primarily due to a one-time loss of Rs 5,680 crore recognised during the quarter. Net interest income (NII), however, increased 9.5% year-on-year to Rs 12,525 crore from Rs 11,435 crore, supported by steady growth in the bank's core lending business.
Interest income rose 6.8% year-on-year to Rs 33,211 crore from Rs 31,091 crore.
Operating profit before provisions and tax (Operating PAT) came in at Rs 8,127 crore, marginally lower by 1.3% from Rs 8,236 crore in the year-ago quarter.
Asset quality Weakens Sequentially
Bank of Baroda's asset quality deteriorated slightly during the quarter.
Gross non-performing assets (GNPA) stood at 1.99% at the end of June, compared with 1.89% in the previous quarter, reflecting a deterioration of 10 basis points.
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Net non-performing assets (NNPA) increased to 0.50% from 0.45% in the March quarter, worsening by 5 basis points sequentially.
Provisions Decline Sharply
Despite the one-time loss, the bank's provisions declined significantly on both a sequential and annual basis.
Total provisions stood at Rs 643 crore, compared with Rs 3,150 crore in the March quarter and Rs 1,967 crore in the corresponding quarter last year.
The lower provisioning requirement indicates an improvement in the underlying credit cost, although asset quality weakened marginally during the quarter.
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