BoB goes into red

Bank of Baroda, for Q1FY21 posted a net loss of Rs.864 crore v/s net profit of Rs.710 crore (YoY). This was mainly on the back of a 71% jump in provisions and contingencies at Rs.5628 crore of which Rs.3458 crore was for NPAs and bad debts written off. There was also the provision of Rs.1811 crore for standard assets of which 50% was for a loan which carries government guarantees and balance 50% for loans under moratorium.

Over and above this, total Provision for COVID-19 stood at Rs 1,806 crore out of which Rs 996 crore was provided in June’20.

On the asset quality front, the bank did better. Gross NPA for the quarter was at 9.39%, almost same as 9.4% for Q4FY20. Net NPA declined from 3.13% to 2.83% (QoQ).

Provision coverage ratio (PCR) rose from 77.34% to 83.3% (YoY).

The stock price did not crash as many had expected; it is trading in the red but not deep in the red. From yesterday’s close of Rs.48.55, it opened at Rs.47.10 and continues to trade at these Rs.47 levels. Its 10% UC for the day is at Rs.43.70.