Bank of Baroda expects its loan portfolio to grow 7-10 percent during the current fiscal year, said Managing Director and CEO Sanjiv Chadha. In the quarter ended September 2021, the state lender’s domestic loans rose 3 percent â¹6.23.368 billion
Chadha said the bank’s focus is on delivering industry-appropriate loan growth, but is also focused on having the highest possible underwriting standards and keeping ct’s margins intaBank.
“So we expect the market to grow at 7-10 percent (loan growth) and that is where our loan growth will be,” he told PTI during an interaction on Wednesday.
He said the bank’s loan portfolio is a little squared, with some segments being very good and others not as robust. The auto loan book was up 23 percent year over year and gold loans are up more than 30 percent.
He said corporate loan book growth has been subdued mainly due to the impact of the COVID-19 pandemic, low capacity utilization and excess liquidity in the system.
However, Chadha said there is room for optimism with corporate lending as there are certain segments on the corporate side that are growing very well due to various government interventions including the production-based incentive systems and the Golden Quadrilateral Highway Network project.
âNow that we are in the high season, we expect that working capital utilization should increase. I think it’s common that once a certain level of capacity utilization is reached, a broader investment cycle is triggered, “he added.
In terms of recoveries, Chadha said the bank’s recoveries were around the first half of FY22 â¹8,000-9,000 crore. It has a recovery target of â¹14,000 crore for FY2022.
âThe first half was about recovery â¹8,000 crore to â¹9,000 crore because there were some large NCLT accounts that started to be closed. We don’t have such big numbers that will be the second half (FY 2022), but we’re seeing a recovery even on smaller accounts, âhe said.
In the quarter ended September 2021, the lender reported a 24.39 percent increase in its individual profit after tax â¹2,088 crore on the other hand â¹1,679 crore in the corresponding quarter of the previous financial year.
NII grew 2.11 percent â¹7,566 crore in Q2FY22 versus â¹7,410 crore in Q2FY21. The net interest margin (NIM) improved in the quarter from 2.88 percent in the prior-year quarter to 2.90 percent.
Gross Non-Performing Assets (GNPAs) improved from 9.14 percent in Q2 FY21 to 8.11 percent in Q2 FY22. The net NPA ratio was 2.83 percent versus 2.51 percent.
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