Bank of India(BOI) Q2 profit rises 41%

Bank of India on Friday said its net profit for the September quarter rose 41% from a year ago after the bank provided less provisions for its bad loans

The state run lender reported a net profit of Rs179.07 crore in the quarter against Rs126.84 crore a year ago. According to Bloomberg analyst estimates, the bank was expected to post a profit of Rs98.93 crore.

Net interest income (NII) or the core income a bank earns by giving loans increased 7% to Rs2,908.24 crore versus Rs2,719.74 crore last year. Other income declined 15.1% to Rs1,706.38 crore from Rs2,010.63 crore in the same period last year.

Provisions and contingencies fell 15% to Rs1,953.30 crore from Rs2,296.22 crore a year ago. On quarter-on-quarter basis, it dropped 13% from Rs2,245.28 crore.

According to Reserve Bank of India’s direction for initiating insolvency process provisioning norms the bank is required to make additional provision of Rs572.58 crore in respect of accounts covered under provisions of insolvency and bankruptcy code over three quarters starting from September quarter and accordingly it provided Rs190.86 crore towards the same during the quarter.

Asset quality improved during the quarter. As a percentage of total loans, gross non-performing assets (NPA) fell to 12.62% as compared to 13.05% in the previous quarter and 13.45% in the year-ago quarter.

Gross NPAs stood at Rs49,306.90 crore, down 5.7% from Rs52,261.95 crore a year ago and Rs51,019.11 crore a quarter ago.

Advances for the quarter was tad up 0.3% to Rs3.65 trillion from a year ago. Deposits went up by 7.6% to Rs5.44 trillion.