Bank of Baroda posted an increase in its net profit of 88 per cent on a year-on-year (YoY) basis in its first quarter (Q1) earnings on Saturday, driven by an improvement in asset quality and strong growth in deposits. The public sector bank (PSB) logged a net profit of Rs 4,070 crore for the June quarter in the current financial year (FY24) against a net profit of Rs 2,168 crore in the first quarter of the previous fiscal year (FY23).


The bank reported it's Gross Non-Performing Assets (GNPAs) at Rs 34,832 crore for Q1FY24, down from Rs 52,590 crore in Q1FY23, in its press exchange filing. The Gross NPA to Gross Advances ratio improved to 3.5 per cent in the reported quarter against 6.2 per cent for the same period a year ago. The bank reported a fall in it’s Net NPA ratio to a record low of 0.78 per cent in Q1FY24, compared to 1.58 per cent in Q1FY23. NPAs are loans or advances issued by the bank which are subject to late repayment or unlikely to be repaid by the borrower in full. 


The Slippage ratio for the bank fell down to 1.05 per cent for the reported quarter, against 1.71 per cent for the same period a year ago. When a bank’s loan becomes a NPA due to the borrower not paying interest for more than 90 days, it gets categorised as a slippage. 


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The bank clocked a strong growth of 24 per cent in Net Interest Income (NII) in the reported quarter on a YoY basis, along with a sturdy growth in Non-Interest Income which grew 2.8 times on a YoY basis. NII is a reflector of interest earned by the bank after measuring the difference between the interest borrowers pay to the bank and the interest paid by the bank to its depositors. 


The lender reported an increase of 15.5 per cent in domestic deposits and 21 per cent in international deposits, both on a YoY basis. It clocked an increase of 5.5 per cent in domestic CASA deposits, which stand at Rs 4,23,600 crore at the end of the reported quarter. CASA represents the Current Account Savings Account, a type of bank account that allows customers to deposit and withdraw money, make transactions and earn interest on deposits. 


The bank reported that Organic Retail Advances grew by 24.8 per cent, auto loans increased by 22.1 per cent, home loans by 18.4 per cent, personal loans by 82.9 per cent, mortgage loans by 15.8 per cent and education loans by 20.8 per cent, all on a YoY basis. 


The bank’s agriculture loan portfolio grew by 15 per cent and total gold loan portfolio registered a growth of 32 per cent, on a YoY basis.