Bank of Baroda net profit rises 11.2% to Rs 5048 crore

MUMBAI: Bank of Baroda reported a record net profit of Rs 5,616 crore for Q4FY26, up 11.2% from Rs 5,048 crore a year ago, driven by higher net interest income and lower tax provisions, while full-year profit crossed Rs 20,000 crore to reach Rs 20,021 crore, a growth of 2.2%.

According to MD and CEO Debadatta Chand, the bank raised its advances growth target to 12-14% from 11-13% and deposit growth to 10-12% from 9-11% after exceeding its FY26 goals. He said the bank received an income tax refund of Rs 1,500 crore during the quarter, which was used to make floating provisions and improve provision coverage rather than boost the bottom line. He said the bank expects to disburse around Rs 12,000 crore to small businesses under the emergency credit line guarantee scheme. On the impact of the West Asia crisis, Chand said the bank has a sizeable business in the Middle East but there is no immediate impact.

Net interest income rose 8.7% year-on-year to Rs 12,494 crore in Q4FY26, supported by a 16.2% rise in the global loan book to Rs 14,29,879 crore. Domestic advances grew 14.5% to Rs 11,69,458 crore, led by a 17.9% increase in retail loans, including auto loans rising 20.6% and mortgages 19.3%. Interest expenses increased 2.7% to Rs 20,148 crore as global deposits rose 12% to Rs 16,48,487 crore. Cost of deposits declined by 34 basis points to 4.78%, while the domestic CASA ratio stood at 38.89% after a 9.8% rise in CASA deposits.

Non-interest income fell 16.2% to Rs 3,967 crore from a high base, while total income rose 1.4% to Rs 16,460 crore. Operating profit increased 11.5% to Rs 9,069 crore, helped by an 8.7% decline in operating expenses to Rs 7,391 crore. Staff costs fell to Rs 3,262 crore from Rs 4,347 crore in the year-ago quarter.

Provisions and contingencies, excluding tax, more than doubled to Rs 3,150 crore, including Rs 2,566 crore for bad loans and write-offs, up nearly 98% year-on-year. Net profit was supported by an 80.2% fall in tax provisions to Rs 303 crore from Rs 1,533 crore, after the bank reversed Rs 1,294 crore in tax provisions following favourable appellate orders. The flow from operating profit of Rs 9,069 crore through provisions and lower taxes resulted in a net profit of Rs 5,616 crore.

Asset quality improved, with the gross NPA ratio declining to 1.89% from 2.26% and the net NPA ratio to 0.45% from 0.58%. Capital adequacy remained at 15.82%, with the CET-1 ratio at 13.16%. The board recommended a dividend of Rs 8.50 per equity share for FY26.

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