Bank of India Managing Director and Chief Executive Officer Rajneesh Karnatak expects the lender's corporate credit book to grow in double-digit numbers during the second half of the ongoing fiscal.
For the September quarter of the financial year 2024–25, the bank has posted a 63% year-on-year jump in net profit. The Mumbai-headquartered bank's PAT grew to Rs 2,374 crore in the second quarter from Rs 1,458 crore in the year-ago period.
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However, the lender's slippage ratio deteriorated to 0.44% in the second quarter of the ongoing fiscal compared to 0.34% in the year-ago period.
On the way forward, Karnatak said that the public sector bank plans to further strengthen its corporate loan book, which grew by over 9% year-on-year in Q2.
“As far as the pipeline is concerned, we have a healthy pipeline of around Rs 70,000 crore plus, out of which the corporate pipeline is Rs 55,000 crore to Rs 60,000 crore,” he said.
“We are confident that the corporate credit growth will go up and be in the double-digit figure for Bank of India in Q3 and Q4,” the CEO added.
The fresh slippages of Bank of India stood at Rs 2,500 crore in this quarter against Rs 1,900 crore in the last quarter. Commenting on what caused this spike, Karnatak said it happened due to a single account.
“There was only one account which has slipped, because of which the overall slippage has increased. Had it not been, our slippage would have been lesser than Rs 1,900 crore in the last quarter. Because of credit cost and slippage, the ratio has increased,” he said.
According to sources quoted by NDTV Profit, it was the Mahanagar Telecom Nigam Ltd. account that added Rs 1,094 crore worth of slippages to Bank of India's July–September quarter results. This in turn increased Bank of India's cumulative slippages to Rs 2,546 crore from Rs 1,930 crore reported during the June quarter.
Assuring that this was a one-time hit, with no further slippages anticipated, Karnatak said, “This is an aberration for this quarter only. There was only one account which has slipped. We do not anticipate any further slippage in the corporate book as of now.”
Shares of Bank of India closed 3.39% lower at Rs 108.40 apiece on the NSE on Tuesday, while the benchmark index Nifty 50 fell 1.07% to 23,883.45.
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