Bank of Baroda Financial Results FY 2014-15 (FY15) and Q4: FY15 May 11, 2015 Global Business touched Rs 10.46 lakh crore level (up 8.25%, yoy) Operating Profit for Q4, FY15 at Rs 2693.52 crore (up 4.42%, yoy) Net Profit for Q4, FY15 at Rs 598.36 crore (down 48.31%, yoy) Operating Profit for FY15 at Rs 9,915.10 crore (up 6.01%, yoy) Net Profit for FY15 at Rs 3398.44 crore (down 25.16%, yoy) Asset Quality with GNPA at 3.72% & NNPA at 1.89% Provision Coverage Ratio was healthy at 64.99% on 31 st March, 2015 ROAA at 0.49% in FY15 CRAR (Basel II) at 13.33%, with Tier 1 at 10.14% CRAR (Basel III) at 12.60%, with Tier 1 at 9.87% and Core Tier 1 at 9.35% in FY15 Bank of Baroda has announced its audited results for the fourth quarter of 2014-15 (or Q4, FY15) and for the full year 2014-15 or FY15 (April-March), following the approval of its Board of Directors on May 11, 2015. Results for Q4, 2014-15 (January-March) Results at a Glance Results for 2014-15 (April-March) Q4 2014-15 Q4 2013-14 % Change Apr-Mar 2014-15 Apr-Mar 2013-14 % Change Total Income 12,057.39 11,614.85 3.81 47,365.55 43,402.45 9.13 Interest Income 10,761.93 10,288.59 4.60 42,963.55 38,939.71 10.33 Other Income 1,295.46 1,326.26-2.32 4,402.00 4,462.74-1.36 Total Expenses# 9,363.86 9,035.30 3.64 37,450.45 34,049.23 9.99 Interest Expenses 7,590.26 7,164.27 5.95 29,776.32 26,974.36 10.39 Net Interest Income 3,171.67 3,124.32 1.52 13,187.23 11,965.35 10.21 Staff Expenses 928.24 1,039.89-10.74 4,261.35 4,139.73 2.94 Operating Expenses# 1,773.60 1,871.03-5.21 7,674.13 7,074.87 8.47 Operating Profit# 2,693.53 2,579.55 4.42 9,915.10 9,353.22 6.01 Provision other than Tax 1,817.50 1,153.15 57.61 4,494.50 3,793.71 18.47 Tax Provision 277.68 253.58 9.50 2,022.17 956.23 111.47 Net Profit # 598.36 1,157.27-48.30 3,398.43 4,541.08-25.16 #: excludes the exceptional items of Rs 15.55 crore for Q3 FY 14, as a share of total deficit of Rs 186.58 crore on account of take-over by the bank of the specified assets and liabilities of the Memon Cooperative Bank Ltd as per the approval granted by RBI vide letter no DBOD.NO.BP.1311/21.04.048/2010-11 dated 25 th July 2011. 1
PROFITABILITY Despite sluggish economic growth, the Bank s Operating Profit (gross profit) stood at Rs 2,694 crore in Q4, FY15 (up 4.42%, y-o-y) as against Rs 2579 crore in Q4, FY14. For the full year FY15, the Bank s Operating Profit was at Rs 9915 crore (up 6.01%, y-o-y). Its Net Profit for Q4, FY15 stood at Rs 598 crore, down 48.30% (y-o-y) and for FY15 full year, the Net Profit was at Rs 3,398 crore, lower 25.16% (y-o-y) due to significant increase in non tax and tax provisions. INCOME During FY15, the Bank s Total Income increased by 9.13% (y-o-y) to Rs 47,365.55 crore. Net Interest Income saw a robust growth of 10.21% (y-o-y) to Rs 13,187.23 crore. The Other Income for FY15 stood at Rs 4,402 crore. During Q4, FY15 Bank s Net Interest Income (NII) increased to Rs 3172 crore (up 1.52%, y-o-y), primarily due to an efficient management of liabilities. Bank s Total Income registered a growth of 3.81% and reached the level of Rs 12,057.39 crore in Q4, FY15 boosted primarily by 4.60% growth in Interest Income. Inspite of lower growth in non-food credit, the Bank s Domestic NIM improved from 2.87% in FY14 to 2.91% in FY15. However, Global NIM eased from 2.36% to 2.31%, over the same period. EXPENSES During Q4, FY15, the Bank s Interest Expenses registered a relatively modest growth of 5.95% (y-o-y) to Rs 7590.26 crore due to the Bank s strict monitoring of funding costs. Its Employee Cost was down by 10.74% (y-o-y) due to increase in fair value of securities in the retirement corpus, the additional provisioning requirement under AS-15 was lower for the quarter. Within domestic deposits, the Share of CASA improved significantly to 33.01% in FY15 from 31.76% in FY14. During FY15, the Bank s Interest Expended, Employee Cost and Total Expenses stood at Rs 29776.32 crore (up 10.39%, y-o-y), Rs 4261.35 crore (up 2.94%, y-o-y) and Rs 37450.45 crore (up 9.99%, y-o-y), respectively. PROVISIONS & CONTINGENCIES Provisions and Contingencies (excluding tax provisions) for the Bank increased by 18.47% to Rs 4494.49 Crs in FY15 mainly due to rise in provisions against non performing loans. During Q4, FY15, it stood at Rs 1817.48 crore. 2
Tax Provisions increased to Rs 2022.17 crore in FY15 due to non availability of deduction against bad debt write offs in India and due to tax payments by the Bank s UAE territory, pertaining to earlier years. During Q4, FY15, the tax provisions increased by 9.50% to Rs 277.68 crore. BUSINESS EXPANSION On a y-o-y basis, Global (Total) Business of the Bank increased by 8.25% (yoy) to Rs 10, 45,625 crore from Rs 9,65,900 crore between end-march 2014 and end-march 2015. While Total Deposits increased by 8.55% (yoy) to Rs 6,17,560 crore on March 31, 2015, Total Advances rose by 7.82% (yoy) to Rs 4,28,065 crore. Bank s Total CASA (Low-cost) Deposits grew by 11.25% (yoy) to Rs 1,62,969 crore in FY15 with the Share of Domestic CASA showing improvement to 33.01% at end-mar, 2015 from 31.76% at end-mar, 2014. The Bank s Retail Credit grew by 14.06% (yoy) to Rs 52,488 crore by end-march, 2015 and formed 17.51% of total gross domestic credit. While the Bank s Farm Credit stood at Rs 37,403 crore (up 31.55%, yoy), its MSME Loan-book stood at Rs 61,993 crore at end-march 2015 reflecting a growth of 9.46% (yoy) in FY15. ASSET QUALITY The Bank continued to focus its efforts towards recovery and asset up-gradation to contain the deterioration in its asset quality position amidst difficult macroeconomic situation. The Bank s Gross NPA ratio stood at 3.72% in Q4, FY15 versus 2.94% in Q4, FY14 and its Net NPA ratio stood at 1.89% in Q4, FY15 versus 1.52% in Q4, FY14, thereby reflecting continued stress in economic environment. While the Bank s Cash Recovery from NPA amounted to Rs 1,492.81crore, the Recovery from PWO accounts was Rs 210.25 crore in FY15. Despite the pressure on earnings, the Bank kept its Provision Coverage Ratio at 64.99% on 31 st March, 2015 versus 65.45% on 31 st March, 2014. CAPITAL ADEQUACY The Bank s Capital Adequacy Ratio was at 13.33% (as per Basel II) as of March 31, 2015. Its Tier 1 capital too was maintained at the healthy level of 10.14%. Under Basel III, the Bank s Capital Adequacy Ratio stood at 12.60% with the Tier 1 capital at 9.87% & Core Tier 1 at 9.35% as on 31st March, 2015. 3
IMPORTANT RATIOS ROAA at 0.49% for FY15 ROE at 9.21% for FY15 NIM at 2.91% in Domestic Operations & 2.31% in Global Operations for FY15 CRAR (Basel II) at 13.33%, with Tier 1 at 10.14% CRAR (Basel III) at 12.60%, Tier 1 at 9.87%, Core Tier 1 at 9.35% as on 31 st Mar, 2015 Cost-Income Ratio at 43.63% for FY15 Earnings per Share at Rs 15.83 for FY15 Book Value Per Share at Rs 166.83 for FY15 DOMESTIC NETWORK Bank has pan Indian presence with 5,190 branches and 8,030 ATMs as on 31 st March, 2015. During the year FY15, the Bank opened 351 new branches and merged 13 branches in its domestic operations across India. In particular, it opened 140 branches in rural operations of which 88 were opened in unbanked rural centres during FY15. The Bank had established 2,644 Ultra Small Branches across the country before 31 st March, 2015. Also, the Bank installed 1,776 new ATMs, opened 106 e-lobbies and provided a number of Bunch Note Acceptors, Self-service Pass book Printers, etc. to its branches during FY15. It also provided Note Counting Machines to almost all its branches and strengthened the structure of Retail and SME Loan Factories its innovative business model - in the country. At end-march, 2015 the Bank possessed a rich set up of 60 Retail Loan Factories and 54 SME Loan Factories across India. OVERSEAS BUSINESS As on 31 st Mar, 2015, the Bank had operations in 24 countries with 104 offices. These 104 offices comprise of 60 branches of the Bank, 43 branches of its overseas subsidiaries and one representative office. During FY15, the Bank opened two new branches of overseas subsidiaries viz. one at Meru, Kenya and another at Mwanza, Tanzania. During FY15, the Bank s Overseas Business contributed 32.47% to the Bank s Total Business, 22.98% to its Operating Profit and 28.60% to its Core Fee income. 4
KEY STRATEGIC INITIATIVES During FY15, the Bank s Bulk & high-cost Deposit at Preferential Rate (above Rs 1 crore) were lowered by Rs 15,535 crore at end-mar, 2015 in the Bank s domestic business. The Bank significantly strengthened its Credit Monitoring process and the system for Early Detection of Stress Accounts so as to undertake speedy follow-up actions. As on 31st Mar, 2015, the Bank covered 22,030 villages under its Financial Inclusion drive, which includes 2,644 Ultra Small Branches to support this initiative. Under Prime Minister Jan Dhan Yojna (PMJDY), the Bank s share was at 5.7% of the total accounts opened by all banks and share in deposits mobilized is 7.86%. SELECT AWARDS & ACCOLADES Bank of Baroda awarded as Best PSU Bank at 5th Dalal Street Investment Journal PSU Awards 2013, ceremony held in New Delhi. Bank of Baroda conferred as the winner of Golden Peacock National Training Award for the year 2014 by the Awards Jury at a function at Thiruvananthapuram under the aegis of Institute of Directors. Bank of Baroda awarded Skoch Order of Merit in India s Best 2014 Financial Inclusion & Deepening Awards 2014 by Skoch Consultancy Services Pvt. Ltd. Bank of Baroda awarded Best PSU for MSME by India SME Forum. Bank of Baroda Ranked 21st amongst Best Indian Brands 2014 in Brand Equity Bank of Baroda conferred Best Bank Global Business Development (Public Sector) & Best Bank Overall (Public Sector) Award in Dun & Bradstreet Polaris Financial Technology Banking Awards 2014. Bank of Baroda won First Prize under Indira Gandhi Rajbhasha Shield Scheme for Bank s exemplary performance in Official Language Implementation under the category of nationalized banks in linguistic region B, for the year 2012-13 Bank of Baroda has been endorsed as one of the top brands at The Economic Times Best Brands 2014 Bank of Baroda won three prizes under Reserve Bank Rajbhasha Shield Competition 2012-13: o First Prize in Linguistic Region B o Second Prize in Linguistic Region A & C Bank of Baroda awarded FE India s Best Bank by The Financial Express (FE) in the Public Sector Bank category for the year 2012-13 Bank of Baroda was awarded for Excellence in Banking (PSU Sector) by My FM Stars of the Industry award Bank of Baroda has won 3 prizes at The IBA Banking Technology Awards 2014 15 at Mumbai. Categories as under: o Winner in Best Financial Inclusion Initiative 5
o First Runner up in Training & Human Resources, E learning Initiatives o First Runner up in Best Use of Data Bank of Baroda has won National Prize First Rank in Innovative Training Practices for the year 2014 from Indian Society for Training and Development (ISTD) Bank of Baroda has won the Champion of Champions Award at the Association of Business Communicators of India (ABCI) Awards 2015. Bank of Baroda was conferred The Most Efficient Public Sector Bank for the year 2014 by Dalal Street Investment Journal in the Best PSU s of India Awards May 11, 2015 Mumbai Ranjan Dhawan Managing Director & CEO 6