Bank Of India Q4 Net Profit Doubles To Rs 1,388 Crore

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New Delhi: State-owned Bank of India on Saturday reported a 115 percent jump in its consolidated profit after tax for the March quarter to Rs 1,388.19 crore, helped by a jump in other income. The city-based lender's profit for FY23 increased to Rs 3,882 crore, up from Rs 3,406 crore in FY22.

The bank is planning for a capital raise of Rs 4,500 crore in equity capital in FY24, which will help bring down the government's stake in the lender to the Sebi-mandated 75 percent. ()

The bank's core net interest income was up over 37 percent to Rs 5,493 crore on a 13 percent growth in advances. It posted a widening of net interest margin to 3.15 percent from 2.56 percent in the year-ago period. ()

Its non-interest income almost doubled to Rs 3,099 crore for the reporting quarter from Rs 1,587 crore a year ago. The same for the preceding December quarter was Rs 1,432 crore.

Helping the non-core earnings was a Rs 1,717 crore profit booked from the sale and revaluation of investments, which stood at a loss of Rs 111 crore in the year-ago period and a profit of Rs 115 crore in the preceding December quarter.

A senior bank official said the bank is targeting for an 11-12 percent growth in advances in FY24 and has a healthy pipeline of loans.

In FY23, it recorded a 9 percent growth in corporate advances, and the official said that the bank will look for quality credit opportunities in the new fiscal, even if it entails compromising on NIMs.

The bank is targeting to increase the share of the retail, agriculture, and MSME (RAM) portfolio to 58 percent from the current 55 percent.

On the asset quality front, its gross non-performing assets (GNPA) ratio decreased to 7.31 percent from the 9.98 percent level in the year-ago period, pointing towards an improvement.

The share of stressed loans where a borrower has missed repayments but which have not been repaid for over 90 days also decreased to 3.29 percent from the 3.69 percent level three months ago.

A bank official said it is targeting to decrease the GNPA ratio to between 6-6.25 percent by the end of FY24.

Further, the official said the bank will be opening its branch in Gandhinagar's GIFT City in the ongoing June quarter and has already decreased 17 international branches ahead of the inauguration based on a government order to consolidate at the GIFT City. Once the GIFT City branch gets operationalised, it will take a call on further consolidation.

Its overall capital adequacy stood at 16.28 percent as on March 31, 2023, which is above the minimum requirements. A bank official informed that the board has given approval for a Rs 6,500 crore capital raising plan, which includes Rs 4,500 crore to bolster the core buffers.

The bank will hit the markets when the conditions are favourable after deciding which route to be taken, the official said, adding that the capital raising will also help reduce the 81.91 per cent government holding in the bank.