NMC health settlement drags Bank of Baroda Q1 net profit down 72%
Bank of Baroda's June-quarter profit fell 72% due to a large settlement payment. Other income also declined, impacting the bank's overall financial performance for the period. Shriram Finance reported a 60% increase in its standalone net profit fo...
By ET Bureau |
Mumbai: The June-quarter profit at Bank of Baroda (BoB) fell 72% due to an extraordinary one- time impact of ₹5,680 crore the bank paid to the administrators of the insolvent UAE-based NMC Health Plc and its affiliates to settle an ongoing case.
Net profit fell to ₹1,278 crore in the quarter ended June 2026, from ₹4,541 crore recorded in the corresponding quarter a year earlier. Profit was also impacted by a 26% fall in other income as both treasury and fee-based income fell year on year.
Other income fell to ₹3,470 crore in June 2026 from ₹4,675 crore a year ago as treasury income fell 60%, while fee income fell 20% year on year.
In the NMC case, the bank was made a party for allegedly being in cohort and allowing transactions without doing due diligence and following proper anti money laundering (AML) and know your customer (KYC) processes.
CEO Debadatta Chand said the large payout made by the bank was after careful commercial consideration. "This decision was taken after assessing the stage of trial and negotiations in this case. It is a commercially prudent decision to close a legacy case based on the amount claimed from the bank. The decision to settle is based on evaluating the time, cost and legal uncertainties. It allows us to close a legacy case and focus on sustaining our growth," Chand said.
He did not give details of the agreement citing confidentiality.
The one-time provision overshadowed strong loan growth for the bank with global advances increasing 17% to ₹14.16 lakh crore led by a 20% growth in MSME loans and an 18% growth in retail advances.
Net interest income (NII) increased 10% to ₹12,524 crore in June 2026. The bank continued to forecast a 12% to 14% credit growth.
On the asset quality front, gross stage 3 assets stood at 4.64% as of June 30, compared with 4.53% a year earlier while net stage 3 assets improved to 2.33% from 2.57% a year earlier. Provisions and contingencies fell 372% to 3,059 crores, from 14,441 crores a year ago.
The state-owned bank has already raised $200 million through the FCNR-B window, managing director Rajneesh Karnatak said, after announcing a 36% year-on-year jump in first quarter net profit at 3,068 crore. “This would help us substitute the reliance on bulk deposits and therefore the cost of deposits may come down,” he said.
The bank’s operating profit rose 26% YoY at 5,051 crore, backed by a 12.6% rise in net interest income at 6,833 crore.
The insurer’s value of new business (VNB) increased 29% to 1,410 crore from 1,090 crore in the corresponding quarter last year, while annualised premium equivalent (APE) rose 36%. However, the VNB margin declined to 26.2% from 27.4% a year earlier, as a larger share of lower-margin group term insurance business weighed on margins.
The company also continued to shift its mix toward non-ULIP and protection products, with ULIPs accounting for 46% of individual APE compared with 57% a year ago.
The product mix shifted further towards non-PAR products, whose share rose to 49% from 38%.
Net profit fell to ₹1,278 crore in the quarter ended June 2026, from ₹4,541 crore recorded in the corresponding quarter a year earlier. Profit was also impacted by a 26% fall in other income as both treasury and fee-based income fell year on year.
Other income fell to ₹3,470 crore in June 2026 from ₹4,675 crore a year ago as treasury income fell 60%, while fee income fell 20% year on year.
In the NMC case, the bank was made a party for allegedly being in cohort and allowing transactions without doing due diligence and following proper anti money laundering (AML) and know your customer (KYC) processes.
CEO Debadatta Chand said the large payout made by the bank was after careful commercial consideration. "This decision was taken after assessing the stage of trial and negotiations in this case. It is a commercially prudent decision to close a legacy case based on the amount claimed from the bank. The decision to settle is based on evaluating the time, cost and legal uncertainties. It allows us to close a legacy case and focus on sustaining our growth," Chand said.
He did not give details of the agreement citing confidentiality.
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The one-time provision overshadowed strong loan growth for the bank with global advances increasing 17% to ₹14.16 lakh crore led by a 20% growth in MSME loans and an 18% growth in retail advances.
Net interest income (NII) increased 10% to ₹12,524 crore in June 2026. The bank continued to forecast a 12% to 14% credit growth.
Shriram Finance Q1 net profit grows 60%
Shriram Finance, in which Japan’s Mitsubishi UFJ Group (MUFG) bought a sizable stake last quarter in what was the biggest cross-border deal in the Indian financial industry, Friday posted a 60% increase in standalone net profit at 3,445 crore.ADVERTISEMENT
Net interest income climbed and provisions fell at the non-bank lender that had posted a net profit of 2,156 crore in Q1FY26. Net interest income (NII) increased 33.7% to 8,056 crore from 6,026 crore a year earlier, while net interest margin (NIM) expanded to 9.04% from 8.11% a year earlier.On the asset quality front, gross stage 3 assets stood at 4.64% as of June 30, compared with 4.53% a year earlier while net stage 3 assets improved to 2.33% from 2.57% a year earlier. Provisions and contingencies fell 372% to 3,059 crores, from 14,441 crores a year ago.
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BoI Q1 net profit jumps 36%, eyes $1.2 billion FCNR flows
Bank of India is seeking to raise $1.2 billion in foreign currency non-resident deposits (FCNR-B) under the special Reserve Bank of India-driven exercise to boost dollar inflows. It plans to garner another $2 billion through overseas borrowings.The state-owned bank has already raised $200 million through the FCNR-B window, managing director Rajneesh Karnatak said, after announcing a 36% year-on-year jump in first quarter net profit at 3,068 crore. “This would help us substitute the reliance on bulk deposits and therefore the cost of deposits may come down,” he said.
The bank’s operating profit rose 26% YoY at 5,051 crore, backed by a 12.6% rise in net interest income at 6,833 crore.
SBI Life Q1 net profit rises 22% on premium show
SBI Life Insurance reported a 22% year-on-year rise in net profit to 720 crore for the quarter ended June, aided by strong premium growth. During the same quarter of the previous year, the insurer had reported a profit of 590 crore.The insurer’s value of new business (VNB) increased 29% to 1,410 crore from 1,090 crore in the corresponding quarter last year, while annualised premium equivalent (APE) rose 36%. However, the VNB margin declined to 26.2% from 27.4% a year earlier, as a larger share of lower-margin group term insurance business weighed on margins.
The company also continued to shift its mix toward non-ULIP and protection products, with ULIPs accounting for 46% of individual APE compared with 57% a year ago.
The product mix shifted further towards non-PAR products, whose share rose to 49% from 38%.
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