Bank of India — Q4 FY26 earnings call

Call held 8 May 2026

Management summary

Bank of India reported strong Q4 FY26 results with significant growth in global business and net profit, coupled with notable improvements in asset quality metrics like GNPA, NNPA, and PCR. However, the bank experienced NIM compression and a decline in CASA ratio. Management outlined strategies for deposit growth, credit expansion, and expressed confidence in navigating upcoming ECL guidelines and global headwinds.

Highlights

  • Global business grew by 14.57% YoY from Rs. 14.83 lakh crore to Rs. 16.98 lakh crore in Mar'26.

  • Net Profit increased by 14% YoY to Rs. 10,527 crore for FY26, and by 15% YoY to Rs. 3,016 crore for Q4FY26.

  • Gross NPA ratio improved by 129 bps YoY to 1.98% for FY26, and Net NPA ratio improved by 26 bps YoY to 0.56%.

  • Provision Coverage Ratio (PCR) improved to 93.57% in Mar26 from 92.39% in Mar25, and Credit Cost improved to 0.48% in FY26 from 0.76% in FY25.

  • CRAR improved to 18.01% as on 31.03.2026 from 17.77% as on 31.03.2025, significantly above RBI's mandated 11.5%.

Concerns

  • Global NIM compressed to 2.52% in FY26 from 2.82% in FY25, a nearly 30 basis point decline.

  • CASA ratio declined to 37.64% in Mar'26, down from 40-41% in FY25.

  • Provisioning for bad and doubtful debts increased to Rs. 1,200 crores in Q4FY26 from Rs. 605 crores in Q3.

Key financials

  1. Net Profit ₹10,527 Cr +14%YoY
  2. Global Business ₹16.98L Cr +14.6%YoY
  3. Gross NPA Ratio 2%
  4. Global NIM 2.5%
  5. CASA Ratio 37.6%
  6. ROA 0.93%

What they filed

Q1 FY27: revenue up 8.7%, net profit up 36.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue17,355 18,211 18,323 18,352 18,406 +6%18,927 +4%19,476 +6%19,949 +9%
Net profit2,374 2,517 2,626 2,252 2,555 +8%2,705 +7%3,016 +15%3,068 +36%
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
  • Liquidity Liquidity disclosed Bank's CRAR improved to 18.01% as on 31.03.2026, significantly above the RBI's mandated 11.5%, providing sufficient capital cushion.
    As on 31.03.2026, Bank's CRAR has improved to 18.01% from 17.77% as on 31.03.2025. ... Presently as I told you that our CRAR is 18.01% as against the RBI's mandated 11.5 %.

Guidance & targets

Profitability

  • ROA Profitability · FY27 (whole year) · High confidence 1%
    As far as the guidance on the ROA is concerned for the whole year FY 27, we are giving a guidance that we'll be touching a number of 1 % for March 27.

    — Shri Rajneesh Karnatak, MD & CEO

Margins

  • Domestic NIM Margins · March 27 · High confidence close to 3%
    Domestic NIM we are definitely targeting to get as close to 3 % as possible.

    — Shri Rajneesh Karnatak, MD & CEO

Loan Book Composition

  • RAM book share Loan Book Composition · March 29 · High confidence 62%
    Yes, so as far as the RAM book is concerned, we are targeting a number of say around 62%, the RAM book and 38 % the Corporate book. So that is for the strategy for the next three years for March 29.

    — Shri Rajneesh Karnatak, MD & CEO

  • Corporate book share Loan Book Composition · March 29 · High confidence 38%

    — Shri Rajneesh Karnatak, MD & CEO

Advances

  • Total advances Advances · March 29 · High confidence around 11 lakh crores
    But having said that, let me clarify that it does not mean that we will not be growing our Corporate book so when we say that 62 % will be RAM book in FY 29 & 38% will be Corporate book, our advances will also be increasing and we are targeting advance of somewhere around 11 lacs crores as on March' 29.

    — Shri Rajneesh Karnatak, MD & CEO

CASA

  • CASA absolute number CASA · FY27 · High confidence around 3.30 lakh crores
    Nonetheless, we are still very much confident that the delta that we will be creating in this financial year also as far as the CASA is concerned, we have set targets for ourselves that we should be closing our CASA at somewhere around 3.30 lakh crores, which is a increase of around 10 % in FY 27.

    — Shri Rajneesh Karnatak, MD & CEO

Asset Quality

  • Recovery from written-off accounts Asset Quality · FY27 · High confidence 2,500 to 3,000 crores
    in the financial year FY 26 & FY 27 also we will be trying to achieve the similar run rate of around 2,500 to 3,000 crores of recovery from these written off accounts.

    — Shri Rajneesh Karnatak, MD & CEO

  • Fresh slippages Asset Quality · FY27 · High confidence 4,000 crores
    Apart from that, we also wanted to reduce our fresh slippages. We have already reduced them to 5,500 crores if you see our presentation in the entire year and we want to further reduce it to 4,000 crores in this financial year.

    — Shri Rajneesh Karnatak, MD & CEO

Agriculture Growth

  • Agricultural growth Agriculture Growth · This financial year (FY27) · High confidence 17%
    So we are very much confident that the agricultural growth will be 17%.

    — Shri Rajneesh Karnatak, MD & CEO

Agriculture Loan Composition

  • Gold loan within agriculture Agriculture Loan Composition · High confidence 35-40%
    So gold alone within the agriculture you are asking, so around 35-40 %it should be there.

    — Shri Rajneesh Karnatak, MD & CEO

Market context

  • Global advances growth Credit Growth · FY27 · High confidence 15-16%
    In alignment with prevailing global economic conditions, the guidance for global advances growth will be around 15-16%, and global deposit growth around 13-14% for FY27.

    — Shri Rajneesh Karnatak, MD & CEO

  • Global deposit growth Deposit Growth · FY27 · High confidence 13-14%
    In alignment with prevailing global economic conditions, the guidance for global advances growth will be around 15-16%, and global deposit growth around 13-14% for FY27.

    — Shri Rajneesh Karnatak, MD & CEO

  • Global NIM Margins · March 27 · High confidence 2.70-2.75%
    Yes, So we are saying that yes, we will have our NIM of somewhere around from present 2.52% to somewhere around 2.70 to 2.75 % that we are guiding for March 27.

    — Shri Rajneesh Karnatak, MD & CEO

What to watch in Q1 FY27

CASA absolute number

FY27
Current >Rs. 3,00,000 crores (March 26)
Target ~Rs. 3,30,000 crores

Why it matters

CASA growth is crucial for reducing the bank's cost of funds and improving Net Interest Margin.

we have set targets for ourselves that we should be closing our CASA at somewhere around 3.30 lakh crores, which is a increase of around 10 % in FY 27.

Risks & concerns

  • Global Headwinds (rising crude, interest rates, inflation, GDP slowdown)

    medium

    Rising crude prices ($102/barrel), increasing interest rates, potential inflation, and a projected GDP growth slowdown to 6.9% by RBI.

    Management acknowledged

  • Supply Chain Disruptions and Geopolitical Tensions

    medium

    Supply chain disruptions and a significant increase in the Baltic index (2x-3x) due to geopolitical situations, potentially impacting exporters, importers, and specific sectors like ceramics, pharmaceuticals, and chemicals.

    Management acknowledged

  • CASA Ratio Decline

    medium

    CASA percentage declined to 37.5% from 40-41% in FY25, indicating a structural shift in deposit patterns and a challenge for low-cost funding.

    Analyst acknowledged

  • Monsoon Forecast Impact on Agriculture Book

    low

    A monsoon forecast being lesser than expected could potentially impact the agriculture loan book, though management is confident due to improved irrigation and focus on allied agriculture.

    Analyst downplayed

Q&A highlights

8 direct
Impact of RBI ECL guidelines on provisioning Direct
As far as the impact is concerned, we do not expect much impact on us... the impact will be only 0.50 % p.a aggregating to total 2.50 % over the next five years.

Management quantifies the expected impact of upcoming regulatory changes on provisioning, indicating preparedness and a manageable financial burden.

Asked by Mr. Ashok Ajmera

Impact of ECLGS 5.0 on credit growth Direct
we expect to fund around 10-12 thousand crores under the ECLGS scheme.

Provides a specific quantitative expectation for credit growth driven by a government scheme, highlighting a potential tailwind for the bank's lending activities.

Asked by Mr. Ashok Ajmera

Retail deposit strategy, CD ratio, and asset vs. liability growth Direct
our CASA percentage is 37 % and retail deposits at around 44%. Thus, our retail franchise of the domestic resources side is around 81-82%... if you see our CD ratio it is around 82-83 %, which is high because obviously there is a crunch of resources.

Details the bank's deposit mix, acknowledges a high CD ratio and resource crunch, and outlines initiatives like 'UDAAN' and Zonal Deposit Centres to strengthen the deposit franchise.

Asked by Mr. Nishit Shah

Geopolitical developments and their impact on credit quality Direct
whatever stress which may come that will get eased out through this ECLGS, but there are certain sectors definitely which is particularly exporters and the importers and also certain segments within the industry like you can say ceramics, pharmaceuticals, chemicals, which maybe feeling the heat of this geopolitical situation in the immediate term.

Management acknowledges external risks (crude, interest rates, supply chain) but expresses confidence in ECLGS mitigating stress, while also identifying specific vulnerable sectors.

Asked by Mr. Namit Arora

Elevated provisioning in Q4 and recovery status of state/central PSU defaults Direct
for bad and doubtful debts, the provisions in fact from December quarter 605, they have gone up to 1,200 crores... there was only one central PSU which got NPA in the last financial year for which we have fully provisioned also... three state PSUs are coming under the SMA category... we are confident that they are having cash flows with them and they will not be slipping into the NPA category.

Clarifies the nature of increased Q4 provisioning and provides reassurance regarding the asset quality of PSU exposures, which are a common concern for public sector banks.

Asked by Mr. Niteen S Dharmawat

Strategy for subsidiaries and wealth management income Direct
we have a very clear strategy for the next five years... mutual fund AUM was somewhere around 3-4 thousand crores. Today, it is at around 14 to 15 thousand crores.

Highlights the bank's focus on non-interest income growth through subsidiaries and wealth management, providing specific growth figures for mutual fund AUM as an example of past success.

Asked by Mr. Ashok Shah

Clarity on NIM guidance, drivers, higher written-off recoveries, and credit cost in the ECL period Direct
our global NIM is at 2.58 %, which has come down by nearly 30 basis point from 2.82 % in March 25... recovery from written off accounts it has improved from 2,300 crores to 2,600 crores... impact of the ECL guidelines on the credit costs, yes, there will be some impact... but we feel that it should not be more than ten basis point on an annualized basis.

Provides detailed breakdown of NIM drivers, quantifies the contribution of written-off recoveries to non-interest income, and reiterates the expected minimal impact of ECL on credit costs.

Asked by Mr. Siddhart R

CASA percentage target and impact of monsoon forecast on agriculture book Direct
we have set targets for ourselves that we should be closing our CASA at somewhere around 3.30 lakh crores, which is a increase of around 10 % in FY 27... not much of droughts are happening in India... So we are very much confident that the agricultural growth will be 17%.

Addresses concerns about CASA ratio decline with a specific target for FY27 and provides a confident outlook on agricultural growth despite monsoon forecasts, citing improved irrigation and gold loan contribution.

Asked by Mr. Divansh

3 min read 8 chapters

Detailed narrative

Q4 FY26 Performance Overview

Bank of India reported a resilient financial performance for FY26, with Net Profit increasing by 14% YoY to Rs. 10,527 crore. For Q4 FY26, Net Profit stood at Rs. 3,016 crore, marking a 15% YoY growth. Operating Profit for FY26 improved by 4% YoY to Rs. 17,049 crore, and for Q4 FY26, it grew 3% YoY to Rs. 5,026 crore. The bank's CRAR improved to 18.01% as on March 31, 2026, significantly above RBI's mandated 11.5%.

Business Growth Highlights

Global business expanded by 14.57% YoY to Rs. 16.98 lakh crore in Mar'26. This was supported by a 13.56% YoY increase in Global Deposits to Rs. 9.27 lakh crore and a 15.82% YoY rise in Global Gross Advances to Rs. 7.71 lakh crore. RAM advances showed robust growth of 19.11% YoY, reaching Rs. 3.84 lakh crore and constituting 58.74% of total advances. Domestic Gross Advances also grew by 16.10% YoY to Rs. 6.54 lakh crore.

Asset Quality Improvement

The bank demonstrated significant improvement in asset quality, with the Gross NPA ratio reducing by 129 bps YoY to 1.98% for FY26. The Net NPA ratio also improved by 26 bps YoY to 0.56%. The Provision Coverage Ratio (PCR) strengthened to 93.57% in Mar'26 from 92.39% in Mar'25, and the slippage ratio improved to 0.83% in FY26 from 1.36% in FY25. Credit Cost also improved to 0.48% in FY26 from 0.76% in FY25.

Profitability and Margin Trends

Net Interest Income (NII) increased by 3% YoY to Rs. 25,172 crore for FY26, with Q4 FY26 NII at Rs. 6,730 crore, up from Rs. 6,063 crore in Q4 FY25. Non-Interest Income grew by 10% YoY to Rs. 9,874 crore for FY26. However, Global Net Interest Margin (NIM) compressed to 2.52% in FY26 from 2.82% in FY25, a decline of nearly 30 basis points, primarily due to the international book's lower margins (1.10% to 1.30%).

Institutional Initiatives and Digital Focus

Bank of India is establishing Zonal Deposit Centres at all Zonal Offices to accelerate CASA accretion and integrated the UMANG App with its BOI OMNI NEO platform for digital services. The bank also launched Bharat Connect Biller Operating Services to streamline collections and established dedicated MSME Desk Helplines. These initiatives aim to enhance customer relationships, digital reach, and grievance redressal, alongside opening 200 new branches in FY26 and planning another 200 in FY27.

Deposit and Advance Strategy

The bank is focusing on strengthening its deposit franchise, particularly CASA, which stood at 37.64% in Mar'26. Initiatives like 'Project UDAAN' and posting Resource Managers in zonal/FGM offices are aimed at garnering new CASA and retail term deposits. For advances, the strategy involves increasing MCLR advances, RAM advances, and Mid Corporate advances through 19 Emerging Corporate branches, targeting better margins and fee income. The bank aims for 62% RAM book and 38% Corporate book by March 29, with total advances reaching around 11 lakh crores.

ECL Guidelines and Impact

Management expressed confidence in a smooth transition to RBI's ECL guidelines, effective April 1, 2027, expecting an impact of only 0.50% p.a. aggregating to 2.50% over five years. The bank has already engaged a 'big four' firm for transitioning and has sufficient cushion in its net worth and CRAR (18.01%) to absorb this impact. The overall impact on credit costs is expected to be not more than ten basis points on an annualized basis.

Outlook on Agriculture and Gold Loans

Despite forecasts of a slightly weaker monsoon (around 92%), the bank is confident in achieving 17% agricultural growth for FY27, citing improved canal networks and a focus on allied agriculture. Gold loans, which constitute 35-40% of the agriculture book, are seen as a key growth driver due to their high yield (over 9%) and minimal asset quality issues, with hardly any NPAs (around 60 crores in the entire agriculture book).

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