Fiscal year ending March 2001 was yet another period of all-round growth for Bank of Baroda, according to its Annual Report released last fortnight in Mumbai.
The Banks’ net profit from its domestic and overseas operations reached $ 1.24 billion, accounting for an increase of 38.7% over the previous financial year, while Operating Profit, at $2.05 billion, was up by an impressive 43.8%.
The Bank wrote total business valued at about $157 billion, up by 28.3% over the recorded figure of $122.39 billion as at the end of March 2010.
Total Advances rose by 30.7% to reach $67.23 billion, while Total Deposits increased by 26.6% to $85.80 billion.
Return on Average Assets rose by 1.33% and Net Interest Income by 48.2%.
The Bank posted 21.48% Return on Equity during the year covering April 2010 to March 2011.
The Bank’s performance for the financial year ending March 31, 2011 showed Non Performing Assets at 0.35%, Capital Adequacy Ratio (Basle II) at 14.52% and Net Interest Margin on global and domestic bases respectively at 3.12% and 3.72%.
Above expectations
The Bank’s Mumbai based Chairman & Managing Director Mangalore Devadas Mallya said the growth in the net profit of Bank of Baroda was “way above market expectations.”
He attributed the impressive performance to a strong growth in net interest income, a good traction in core fee-based income and a modest growth in operating expenses.
“These helped the Bank to register overall growth despite increased provisions during the financial year,” he said.
He said the Board of Directors, at their meeting held in Mumbai on April 28, 2011, recommended that a dividend of `16.50 a share or 165% for the financial year be paid.
Following the declaration of results, the Bank’s shares gained `4.75 (0.48% at `994.90) in the Bombay Stock Exchange.
But the Bank’s Current Account Savings Account (CASA) Share in domestic deposit terms dropped to 34.4%, attributed to steep rise in term deposit rates during the financial year.
Mr Mallya said the Bank’s Retail Credit grew by 33.8% to reach $9.53 billion, accounting for 18.88% of total gross domestic credit.
“Our credit to the farming sector rose by 13.5% to reach $7.21 billion, while our small and medium enterprises loan book stood at $8.04 billion, reflecting 29.6% growth,” he said.
Bright prospects
Gross Non-Performing Assets (NPA) were computed at 1.36%, the same as the previous financial year, while the Net NPA showed a negligible increase from 0.34% to 0.35% as at the end of March 2011.
The Bank’s Net Worth has grown by a rich 43.3% to $5.80 billion. The Cost-Income ratio dropped significantly from 43.57% to 39.87%, Mr Mallya said.
“The Bank has a strong pan Indian presence with 3364 branches and enjoys a rich global customer base of 39 million. Our overseas network is spread across 25 countries with 85 offices,” he said.
The Bank opened several new branches during the 2010-2011 financial years including five in the UAE (Rakia in Ras Al Khaimah; Al Quasis, Al Karama and Shaikh Zayed Road in Dubai; National Paints in Sharjah) one each in New Zealand (Auckland), UK (Ilford Essex) United Kingdom.
Bank of Baroda has established a new joint venture called, ‘India International Bank (Malaysia) Bhd to open a commercial bank in Malaysia.
The Bank received a number of Awards during the year, among the most prestigious of which were the ‘Bank of the Year (India)’ given by The Banker, London, ‘The Best Bank Award 2010’ by Business India and the ‘Best Banker Award’ by Business Standard.
The New Zealand scene
The first branch of Bank of Baroda in New Zealand has also performed well, according to Bank of Baroda (New Zealand) Limited Managing Director Satish Vermani.
“We commenced operations in June 2010 and for the period ending March 31, 2011, our total deposits were $12 million, whereas our total advances were $8 million. We made a modest profit of $.020 million,” he said.
