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Bank of Baroda — Q4 FY26 earnings call

Call held 14 May 2026

Management summary

Bank of Baroda delivered a strong performance in Q4 FY26 and for the full financial year, reporting record net profits and significant growth in business volumes. Asset quality showed robust improvement, and capital adequacy remained strong. The bank also made strategic moves in capital raising and new business ventures, while prudently managing increased employee costs and acknowledging potential geopolitical risks.

Highlights

Q4 FY26 Net Profit of ₹5,616 crores, registering a growth of 11.2% YoY, which is the highest ever quarterly net profit posted by the Bank.
FY26 Net Profit of ₹20,021 crores, which is the highest ever net profit.
Global business volume has crossed the milestone of ₹30 lakh crores and stands at ₹30.78 lakh crores, registering the YoY growth of 13.9%.
Global advances have grown by 16.2% YoY with domestic advances growing at 14.5%.
GNPA ratio has improved by 37 bps YoY and stands at 1.89%, and Net NPA ratio is below 1% at 0.45%, an improvement of 13 bps YoY.
Provision coverage ratio including TWO is comfortable at 93.94%.
Capital position continues to be strong with CET 1 at 13.16%, Tier 1 at 13.64% and CRAR at 15.82%.
Successfully raised ₹10,000 crores through green infrastructure bonds.

Concerns

Employee cost increased by ₹520 crores in Q4 FY26 due to the adoption of new mortality tables for AS-15 retirement liability.
Credit cost for Q4 FY26 increased to 0.76% (from 0.44% in Q4 FY25) mainly due to a prudential floating provisioning of ₹1,500 crores.
Geopolitical headwinds were acknowledged as a potential risk to global and MSME books.

Key financials

3 periods

Headline

Global Business Volume
₹3.08L Cr
YoY +13.9%
Global Advances Growth
16.2%
Total Deposits Growth
12%
GNPA Ratio
1.9%
YoY -0.37%
Net NPA Ratio
0.45%
YoY -0.13%
PCR (including TWO)
93.9%
CRAR
15.8%
CASA Ratio
38.9%
QoQ +0.45%

Q4 FY26

Operating Profit
₹9,069 Cr
YoY +11.5%
Net Profit
₹5,616 Cr
YoY +11.2%
RoA
1.1%
NIM
2.9%
Credit Cost
0.76%

FY26

Net Profit
₹20,021 Cr
RoA
1.1%

What they filed

Q1 FY27: revenue up 6.8%, net profit down 47.7% against the same quarter last year.

₹ Cr · quarterly

Line item	Q2 FY25	Q3 FY25	Q4 FY25	Q1 FY26	Q2 FY26	Q3 FY26	Q4 FY26	Q1 FY27
Revenue	31,902	32,570	32,820	32,866	33,318 +4%	33,600 +3%	34,514 +5%	35,115 +7%
Expenses	12,755	10,654	12,712	12,928	11,548	12,390	13,155	12,130
Other income	7,553	5,163	7,076	5,538	5,116	6,399	5,474	522
Interest	19,266	20,143	20,273	20,307	20,191	20,586	20,776	21,301
Depreciation	0	0	0	0	0	0	0	0
Profit before tax	7,434	6,935	6,911	5,170	6,695 −10%	7,024 +1%	6,057 −12%	2,206 −57%
Tax rate	27%	26%	23%	35%	24%	23%	7%	29%
Net profit	5,405	5,250	5,447	3,517	5,181 −4%	5,501 +5%	5,872 +8%	1,839 −48%
EPS	10.36	10.08	10.48	6.71	9.93	10.53	11.22	3.45

How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence

Dividend ₹8.5/share (final)

Bank has declared a dividend of Rs. 8.5 per share, subject to requisite approvals.
M&A Green Infrastructure Bond Other · Closed · Consideration ₹[object Object] (undisclosed)

First in India to raise a green infra bond, good response (3x oversubscribed)

On the ESG front, we raised almost Rs. 10,000 crores of the green infrastructure bond sometime, a couple of months back. And that is one of the first in India in terms of raising green infrastructure bond, we got a very good response on that.
M&A BOB's Securities and Giltedge Limited (Primary Dealer business) New venture · Operational · Consideration ₹[object Object] (undisclosed)

To capture debt side businesses and be a market maker in debt instruments.
Committed capital of Rs. 2,000 crores, currently availed Rs. 500 crores.

At the same time, we announced that we have made one of the subsidiary operating from 1st April, that is we created a primary dealer business in terms of creating a BOB's Securities and Giltedge Limited.
M&A Pension Fund Sponsor New venture · Announced

To scale up business on the pension side.

There is also announcement that we did yesterday in terms of our intention to float a pension fund that we have announced.
M&A Baroda Sun Technology New venture · Operational

Purely a tech company meant for Bank of Baroda for investing into emerging technology.

Last year, we had formalized a company called Baroda Sun Technology. That's a purely a tech company meant for Bank of Baroda for investing into emerging technology.
Liquidity Liquidity disclosed Quarterly average LCR remains healthy at approximately 127%. SLR buffer of 4.5%-5% maintained.

Our quarterly average LCR remains healthy at approximately 127%. Bank has declared a dividend of Rs. 8.5 per share, subject to requisite approvals.

Guidance & targets

Credit Growth

Loan Growth Credit Growth · full year · High confidence 12-14%

Previously 11-13% → 12-14%

The loan growth earlier we had given a guidance of 11 to 13%, now we are upsizing that to 12 to 14%.

— Dr. Debadatta Chand, MD & CEO

Deposit Growth

Deposit Growth Deposit Growth · full year · High confidence 10-12%

Previously 9-11% → 10-12%

Deposit growth guidance for the last year was 9 to 11 %, that we are improving to 10 to 12 %.

— Dr. Debadatta Chand, MD & CEO

Profitability

NIM Profitability · full year · High confidence 2.75-2.95%

The NIM guidance, although we posted a NIM of 2.89%, but there would be going forward different market scenarios. So, the NIM guidance has been 2.75 to 2.95% for the full year.

— Dr. Debadatta Chand, MD & CEO
RoA Profitability · full year · High confidence >1%

ROA, as we always say, the ROA is going to be more than 1%.

— Dr. Debadatta Chand, MD & CEO

Asset Quality

Slippage Ratio Asset Quality · full year · High confidence 1-1.25%

The slippage ratio we continue to maintain at 1 to 1.25% considering the geopolitical issue that we are going to have, which is prevailing at this point of time.

— Dr. Debadatta Chand, MD & CEO
Credit Cost Asset Quality · full year · High confidence <0.60%

The credit cost for the full year is going to be less than 0.60%. This year it is 0.46%, but our guidance for the full year is less than 0.60%.

— Dr. Debadatta Chand, MD & CEO

Capital Raising

AT-1 and Tier 2 Capital Raising Capital Raising · FY27 · High confidence ₹6,000 crores

I think we have announced today that say Rs. 6000 crores of AT-1 and tier 2 we are going to raise this year.

— Dr. Debadatta Chand, MD & CEO
Equity Capital Raising Capital Raising · over 2-3 years (up to FY28) · High confidence ₹8,500 crores

already I just remind you; we have enabling provision of raising almost Rs. 8500 crores of equity capital over a period of 2-3 years. That is still FY28.

— Dr. Debadatta Chand, MD & CEO

Disbursement

ECLGS Disbursement Disbursement · High confidence ₹12,000+ crores

Based on the 20% of that, we are expecting Rs. 12,000 plus crores is the impact which you can disperse because of the ECLGS scheme.

— Dr. Debadatta Chand, MD & CEO

New Ventures

Pension Fund Subsidiary Operationalization New Ventures · Medium confidence 6-9 months

On the timelines for pension fund, the pension fund only we have got the appointment letter. Many of the regulatory approval we are yet to take, but my normal sense would be something between 6 to 9 months can be timelines on an anticipated level.

— Dr. Debadatta Chand, MD & CEO

Headcount

Headcount Addition Headcount · FY27 · Medium confidence 4,000-5,000

So, in that way, I think we'll be adding something around 4 to 5,000 headcounts in this year. I mean, 2026-27, I meant to say.

— Dr. Debadatta Chand, MD & CEO

Deposit Mix

Bulk Deposit Percentage Deposit Mix · High confidence <20%

So as of today, I'm comfortable within my own target range of operating within 20%. Right. So, I'm taking this as a percentage of total deposit, you have to recompute the data in that way. That's the target that we aim to achieve.

— Dr. Debadatta Chand, MD & CEO

What to watch in Q1 FY27

ECL Guidelines Impact Quantification

Next quarter (after implementation).

Current Computing full impact, no specific number yet.

Target Specific quantified impact on credit cost/capital.

Why it matters

Crucial for understanding future provisioning and capital requirements and will provide clarity on a significant regulatory change.

But having issued the final guidelines, it would not be proper to without really running computation transaction wise difficult to say with regard to any quantification. We will do that, but we will do it slightly, once we implement and then have a number, possibly one quarter number coming very clear on that.

Risks & concerns

Geopolitical Headwinds
medium

Geopolitical issues, particularly in West Asia, could impact global books and MSME sector, though no immediate impact is seen.

Management acknowledged
Liquidity Tightness
medium

Market liquidity tightness could make cost of deposits sticky, requiring focus on asset repricing to manage NIM.

Management acknowledged
ECL Guidelines Impact
medium

Uncertainty around the final quantified impact of new ECL guidelines, currently being computed.

Management acknowledged
Weak Monsoon
low

Analyst concern about increasing agriculture NPA due to weak monsoon; management stated Indian agriculture is resilient and it's a normalized slippage.

Analyst downplayed
Auto Loan Aggression
low

Analyst concern about PSU banks' aggressive long-tenure auto loans; management stated their focus on salaried class and benign asset quality.

Analyst downplayed

Q&A highlights

3 direct, 1 evasive

NIM improvement despite cost of deposits and yield on advances trends Partial

See, there are two factors here. Cost of deposit of growth is marginal. The yield on advances, because there are different basis here. Actually, the cost of deposit has a larger basis compared to the yield on advances. So, consequently, when you translate into a NIM, then it works out different. So, if you look at the growth, it is 2.89% versus 2.79%. But while articulating this stance, again, we say for the full year, it is 2.75 to 2.95%. So, a lot of repricing happening both on the asset liability and that again depends upon the market scenario. What we have seen in the March quarter also a bit of tightness in the liquidities that may prevail this quarter also. So, slightly that is why we are putting a NIM guidance of 2.75% to 2.95%. Saying so, there is also element of the IT refund which also contributed to some extent.

Analyst questioned the drivers of NIM improvement given seemingly contradictory trends in cost of deposits and yield on advances, leading to management clarifying the role of market repricing and IT refunds.

Asked by Mayur Shetty

Purpose and usability of the ₹1,500 crores floating provision Direct

Look, I mean, we are buffering the balance sheet strength. ECL provision is a different provision than the floating provision. Floating provision is a, it is buffer the balance sheet strength. So, these are not directly linked, but then whatever ECL provision requirement, the balance sheet, look, the profitability that we have declared for this year is Rs. 20,021 crores, that is significant. So, in that way, I mean, with the current levels is quite capable of handling any impact for the ECL. But floating provision is just to buffer the balance sheet in terms of the balance sheet strength.

Clarified that the floating provision is a general buffer for balance sheet strength, not specifically for ECL, and requires regulatory approval for use, distinguishing it from regular provisioning.

Asked by Mayur Shetty

Impact of Middle East conflict on foreign loan portfolio and overseas employees Partial

See, there are two, three things important here. The collection efficiency rather has improved vis-a-vis the December quarter. So, that is something. Asset quality has been good. The CRILC data has been positive. It has improved significantly. It has improved. So, immediate impact on the book is not there that you can see from the numbers. What is going forward to aspect that you say, because now on the ECLGS, the announcement is precisely to take care of the geopolitical impact on the customer side, particularly on the MSME side. At the same time, we have significant global books. So, the impact on the global books, we don't know as of today. It can be something we need to map it out. As of today, we don't see anything on the global book also because of the geopolitical impact in global book. We have a large operation in a couple of impacted territory that we are looking at this geopolitical tension. So, considering all this, I mean, any impact, the Bank's book is quite resilient in terms of taking care of this impact. But as of today, I don't see in terms of number any impact. But we are mindful of any impact that may come because of geopolitical issue directly on the domestic book and also on the international book.

Addressed concerns about geopolitical risks, stating no immediate impact on numbers or collection efficiency, but acknowledged being watchful and having contingency plans for employees and potential future impacts.

Asked by Ashish Agashe

Rationale for increasing loan growth guidance despite gloomy economic headlines Direct

No, actually, look, we are given a guidance of 11-13 % and we achieved 16.2%. That is significant, right? So, in terms of how do you outperform or how do better of your guidance. So, and it's a full year guidance. The first thing on the geopolitical, our assessment is that, it may not continue for a longer time. In that scenario, possibly the growth is going to come back. Secondly, as of today, if you look at my YoY growth, post 31st also, it looks very healthy. Like, we compute the data on a daily basis and the YoY growth both on the balance sheet, both on asset and liability continue to be healthy like we had in March. Similarly, this is a scenario where upsizing by 1% only, but it's a full year guidance. We'll be watching out our ability to grow because the deposit growth has come back to the system. I think that's something also gives a bit of optimistic in terms of a higher growth in advances. So, considering all these factors, we're still optimistically looking at upsizing the guidance by 1%.

Management justified the increased loan growth guidance by pointing to strong current growth, returning deposit growth, and an optimistic view that geopolitical issues might be temporary.

Asked by Ashish Agashe

Strategy for low-cost deposit mobilization and ideal bulk deposit percentage Direct

Shrishti, I'll be happy to know that at 38.9%, we have one of the top quartile CASA percentage in the system, right? And if you look at March over December, the CASA percentage improved by 45 bps right. On a year to year, the dip is 107 bps but if you see the market trend, this is still maybe one of the lowest that I believe on the market cut in the CASA. At 38.9%, I think it's still very healthy as far as the Bank is concerned on the CASA. Saying on the bulk deposit, yes, the last 3 years we had a stance of reducing dependency on the bulk deposit. I think at one point of time, bulk deposit as a percentage of total deposit, which was in excess of 20% rather, was 23-24% has gone down to 17%. It is slightly increased to 19 point some percentage for March. The reason being that, I mean, when there is a deposit growth, I mean, the credit advances growth has been faster than the deposit, then you have to raise resources in some means. So, it's more of a liquidity management in terms of raising slightly extra bulk deposit and growth, the retail term deposit growth is almost 15%, 14.8%. The bulk is 24%. So slightly extra growth is precisely to manage the overall market and also the loan growth and the same time managing liquidity. But yes, on a dependency scale, we are very, I mean, mindful of not relying too much on the bulk deposit, both from the volatility perspective and also on the cost perspective. So as a Bank, we still continue to have a stance of less dependency, but sometimes you may require to do based on the balance sheet requirement.

Management detailed their strategy to maintain a strong CASA ratio (38.9%) and reduce dependency on bulk deposits, aiming to keep bulk deposits below 20% of total deposits, while balancing liquidity needs.

Asked by Shrishti Sharma

Concerns about aggression in long-tenure auto loans by PSU banks and potential risks Partial

I don't see a PSU outlook here, but as far as the Bank is concerned, we'll continue to grow on auto loan. The reason being, look, auto loan is not a productive asset to generate revenue. I mean, it's based on the cash flow a person is having from which he pays the money. So, our selection of borrower in terms of auto loans are more looking into cash flow, salaried class, where we have done bulk transactions, bulk tie-ups. So, I think in that way, the growth has been good and as of today, whether I track the stress book or the GNPA percentage, I think these are all benign and very, very small at this point of time because possibly the ability of the cash flow to support the payout is still continuing the same way. So going forward, in case there is anything that we see at an elevated level of risk over there, actually we do portfolio review every quarter on all the books.

Analyst raised a sector-wide concern about aggressive auto loan growth. Management clarified their specific strategy of focusing on salaried class and cash flow, indicating benign asset quality and regular portfolio reviews.

Asked by Kunal Shah

Bank's plan on lending to Vodafone Idea Evasive

Ma'am, I'll just take a pardon on this because as a policy of the Bank, which the Board has laid out, bilateral account we don't discuss. So, in case of something, one we can later stage offline can reach out to us. But on a, I mean, meet we don't discuss any bilateral account. So, I take pardon for that. Thank you.

Management explicitly declined to discuss a specific bilateral account, adhering to bank policy, which is a common response for sensitive client-specific queries.

Asked by Aathira

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Detailed narrative

Record Profitability and Robust Business Growth

Bank of Baroda achieved its highest ever quarterly net profit of ₹5,616 crores in Q4 FY26, marking an 11.2% YoY increase. For the full financial year 2026, the net profit reached a record ₹20,021 crores. The bank's global business volume surpassed ₹30 lakh crores, standing at ₹30.78 lakh crores with a YoY growth of 13.9%. Global advances grew by 16.2% YoY, driven by strong domestic advances growth of 14.5% and international advances growth of 24.4%.

Strong Asset Quality Improvement

The bank demonstrated robust asset quality, with the Gross Non-Performing Asset (GNPA) ratio improving by 37 basis points YoY to 1.89%. The Net Non-Performing Asset (Net NPA) ratio also saw a significant improvement of 13 basis points YoY, reaching 0.45%. The provision coverage ratio (PCR), including technical write-offs (TWO), remained comfortable at 93.94%. Slippage ratio for Q4 FY26 reduced by 11 bps YoY to 0.89%, and for the full year, it reduced by 6 bps YoY to 0.72%.

Strategic Capital Raising and New Business Ventures

Bank of Baroda successfully raised ₹10,000 crores through green infrastructure bonds, marking a first in India with strong market response. The bank also made its Primary Dealer (PD) business, BOB's Securities and Giltedge Limited, operational from April 1, 2026, committing ₹2,000 crores in capital. Additionally, approval was received to become a sponsor for a pension fund, with operationalization expected within 6-9 months. These initiatives aim to diversify revenue streams and strengthen the bank's presence in financial markets.

Updated Guidance for FY27

For the full year FY27, the bank has upsized its loan growth guidance to 12-14% (from 11-13%) and deposit growth guidance to 10-12% (from 9-11%). The Net Interest Margin (NIM) is projected to be in the range of 2.75-2.95%. The Return on Assets (RoA) is expected to remain above 1%, and the slippage ratio is targeted to be maintained at 1-1.25%. Credit cost is guided to be less than 0.60% for the full year.

Managing Costs and Liquidity

The bank incurred an increase in employee costs of ₹520 crores in Q4 FY26 due to the adoption of new AS-15 mortality tables. Despite this, the operating profit grew by 11.5% YoY. The cost of deposits remained sticky at 4.78% for Q4 FY26, and the bank maintains a healthy quarterly average Liquidity Coverage Ratio (LCR) of 127%. The strategy continues to focus on reducing dependency on bulk deposits, aiming to keep them below 20% of total deposits.

Geopolitical Risks and MSME Sector Resilience

Management acknowledged geopolitical headwinds as a potential risk, particularly concerning global books and the MSME sector. However, no immediate impact on the bank's numbers or collection efficiencies has been observed. The CRILC SMA 1 and 2 as a percentage of standard advances improved to 0.18% as of March 26, indicating resilience in the MSME sector, supported by government schemes like ECLGS.

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