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Q4 net profit for Bank of India doubles to Rs. 1,388 billion

The state-owned Bank of India announced on Saturday that an increase in other revenue helped its consolidated profit after tax for the March quarter climb by 115% to Rs 1,388.19 crore.

The lender situated in the city saw a rise in earnings for FY23, going from Rs 3,406 crore in FY22 to Rs 3,882 crore.

The bank anticipates raising Rs 4,500 crore in equity capital in FY24, which will assist in reducing the government's ownership interest in the institution to the Sebi-required 75%.

On the back of a 13% increase in loans, the bank's core net interest income increased by more than 37% to Rs 5,493 crore. The net interest margin increased from 2.56 percent to 3.15 percent in the same time last year.

From Rs 1,587 crore a year earlier, its non-interest revenue than quadrupled to Rs 3,099 crore for the reporting quarter. The identical amount, Rs 1,432 crore, was reported for the December quarter before.

A profit of Rs 1,717 crore from the sale and revaluation of investments, which was up from a loss of Rs 111 crore and a profit of Rs 115 crore in the prior December quarter, helped the non-core profits.

According to a senior bank executive, the bank has a robust loan pipeline and is on track to boost advances by 11–12% in FY24.

The official said that the bank would hunt for quality lending possibilities in the coming fiscal year, even if it means sacrificing on NIMs. In FY23, it saw a 9% rise in corporate loans.

The bank wants to expand the percentage of the retail, agricultural, and MSME (RAM) portfolio from the present level of 55% to a goal of 58%.

On the front of asset quality, its gross non-performing assets (GNPA) ratio dropped from a level of 9.98% in the prior quarter to 7.31% this time around, indicating an improvement.

In addition, the percentage of stressed loans—those where the borrower has fallen behind on payments but hasn't made up the difference in more than 90 days—declined from 3.69 percent to 3.29 percent during the last three months.

By the end of FY24, the bank hopes to reduce the GNPA ratio to between 6 and 6.25%, according to a bank official.

The official said that the bank would build a branch in Gandhinagar's GIFT City during the current quarter of June and that it has already closed 17 foreign branches in advance of the launch as a result of a government directive to consolidate at the GIFT City. After the GIFT City branch is operating, a decision about further consolidation will be made.

As of March 31, 2023, it has a total capital adequacy of 16.28%, which is more than the minimal standards.

According to a bank official, the board has approved a capital raising proposal of Rs 6,500 crore, including Rs 4,500 crore to strengthen the core buffers.

After choosing a course of action, the bank would enter the markets when circumstances are suitable, the official said, adding that the capital raising will also assist lower the 81.91 percent government stake in the bank.

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