Calcutta, July 28: Bank of Baroda (BoB) has registered a 16.62 per cent increase in net profit for the first quarter ended June 30, 2014, at Rs 1,361.88 crore compared with Rs 1,167.87 crore in the corresponding quarter a year ago.
A combination of a rise in net interest income and a fall in provisions has pulled up the bottomline of the public sector lender even as operating expenses increased 11.33 per cent.
The net interest income of the bank increased 15.20 per cent to Rs 3,328.31 crore over the same period a year ago. The other income of the bank, however, dipped 16.7 per cent to Rs 1,024.54 crore during the quarter.
According to bank chairman and managing director S.S. Mundra, the decline in the other income was on account of a dip in trading gains because of hardening in the yields of government securities.
The total provisions of the bank decreased to Rs 526.71 crore at the end of the June quarter from Rs 1,017.86 crore in the year-ago period.
The provision coverage ratio of the bank increased from 65.45 per cent at the end of March 31 to 66.68 per cent at the end of June 30.
The provision ratio measures the extent of the provisions made vis-a-vis the total bad assets.
Gross non-performing assets (NPA) of the bank increased 23.80 per cent to Rs 12,086.81 crore at the end of the the June quarter compared with Rs 9,762.55 crore in the year-ago period. The gross NPA, as a percentage of total assets, increased to 3.11 per cent from 2.99 per cent.
The bank’s net interest margin improved to 2.94 per cent from 2.84 per cent in the previous quarter, while Mundra said BoB was targeting to take it up to 3 per cent by the end of the fiscal.
The capital adequacy of the bank to risk weighted assets under Basel II stood at 12.50 per cent (12.70 per cent) and under Basel III at 11.91 per cent (12.46 per cent).
On the government’s move to consolidate banks, Mundra said, “if such a move comes, Bank of Baroda will be an acquirer and not one which will be acquired”.
The Bank of Baroda stock today rose 0.53 per cent to close at Rs 866.10 on the BSE.