Major improvement in asset quality unlikely in near term: BoB
Mumbai: Public sector lender Bank of Baroda (BoB) doesn't see significant improvement in the asset quality and restructured book in the near term unless growth picks up, a top bank official has said.
"We have seen some improvement on the bad asset front but not great improvement. For significant improvement to happen, we need growth to pick up," BoB executive director P Srinivas told PTI.
He also said the NPA (non-performing asset) numbers may be at the same level as reported in the second quarter of the current financial year.
BoB's gross NPAs stood at 1.98 percent in the second quarter and net NPAs at 0.82 percent.
On the restructured accounts, Srinivas said things may not significantly improve on the restructured accounts front in the third quarter as well.
The bank had restructured around Rs 950 crore of loans in the second quarter.
When asked about credit growth, Srinivas expressed the hope that the bank would be able to close the year with a credit growth of 19-20 percent driven by a good show by the retail segments.
"Retail loan book will grow faster this fiscal while we expect corporate loan growth to be subdued," Srinivas said.
The public sector lender, which has asked for Rs 1,500 crore infusion from the government, also said there is no intimation from the government with regard to the quantum of infusion for the bank.
"We have asked for Rs 1,500 crore for this fiscal. But, we don't know what will be the amount that will come in from the government," Srinivas said.
Late last week, government had announced an infusion of Rs 12,517 crore into public sector banks to boost their capital adequacy ratios and to support business growth.
Bank of Baroda posted 11.6 percent rise in its net profit at Rs 1,301.39 crore in the July-September quarter. Its total income rose 19.6 percent to Rs 9,550.86 crore.