Bank of India

Bank of India reported a robust financial year 2025, with net profit surging 46% YoY to Rs.9,219 crores and operating profit increasing 17% YoY to over Rs.16,000 crores. Global advances grew 13.74% to Rs.6,66,000 crores, while RAM advances, a key focus area, expanded 18.37% to Rs.3,23,000 crores, now comprising 57% of the total advance book.

The bank demonstrated significant improvement in asset quality, with the Gross NPA ratio reducing by 171 basis points to 3.27% and Net NPA ratio improving by 40 basis points to 0.82% in FY25. The Provision Coverage Ratio (PCR) also strengthened to 92.39%, up from 90.59% in FY24, indicating better provisioning adequacy. The slippage ratio for FY25 was 1.36%, with Q4 FY25 at 0.32%.

Global Net Interest Margin (NIM) for FY25 stood at 2.82%, a decline from 2.97% in FY24, with Q4 FY25 yield on advances falling to 8.27% from 8.55% in the previous quarter due to Repo rate cuts impacting EBLR-linked loans. In response, management is strategically focusing on enhancing non-interest income, which grew 48% YoY to Rs.8,994 crores in FY25, and maintaining strong recoveries from written-off accounts, totaling Rs.2,300 crores in FY25.

Bank of India is heavily investing in technology, with a budget of Rs.2,000 crores for FY26, following Rs.1,700 crores spent in FY25. Digital initiatives have led to a digital loan book of Rs.80,000 crores, representing 12% of global advances, and generated over Rs.300 crores in income from transaction banking and debit mandates in FY25. The bank has also streamlined 29 digital journeys on the IT side, up from 22 last year, enhancing operational efficiency and customer experience.

While the CASA ratio saw a slight dip from 43% in March '24 to 40% in March '25, the bank managed to grow absolute CASA by over Rs.10,000 crores YoY to Rs.2.80 lakh crores. Global deposits increased 10.65% YoY to Rs.8,16,000 crores. Management is committed to protecting the CASA percentage at around 40% in FY26 and is focusing on retail term deposits and low-cost deposit mobilization to manage the cost of funds.

The bank is pursuing a selective approach to corporate lending, prioritizing higher-yielding MCLR-linked loans over EBLR-linked AAA/AA rated exposures, aiming for double-digit corporate book growth in FY26. It has opened 20 Emerging Corporate Credit Branches to target mid-corporate and emerging clients. MSME GNPAs reduced from Rs.10,000 crores to Rs.7,500 crores, attributed to robust growth in the MSME book, improved underwriting, and enhanced collection efficiencies through dedicated centers.

The Return on Assets (RoA) improved significantly from 0.70% in FY24 to 0.90% in FY25, reaching 0.98% in Q4 FY25. Management has set a clear target to achieve and sustain an RoA of 1% in the ensuing quarters. The bank projects global advances growth of 12-13% and global deposit growth of 11-12% for FY26, with a continued emphasis on asset quality and profitability.