The lender’s core banking performance also showed strength, with net interest income (NII) growing 9.0% year-on-year to Rs 13,026 crore. Operating profit rose significantly by 50.9% to Rs 11,430 crore, while total operating income expanded 28.7% to Rs 19,907 crore. Operating expenses increased by a more moderate 7.4% to Rs 8,477 crore. For the first half of FY27, the bank reported a net profit of Rs 7,810 crore, though this figure was lower than the Rs 9,351 crore recorded in the first half of the previous fiscal year, indicating the significant contribution of one-off gains to the Q2 standalone result.
Asset quality metrics improved across the board, reflecting a healthier loan book. The gross non-performing asset (GNPA) ratio declined to 1.78% in Q2 FY27, down from 2.16% a year earlier. The net non-performing asset (NNPA) ratio fell to 0.37% from 0.57%, while the slippage ratio dropped 22 basis points to 0.69%. The provision coverage ratio, including technical write-offs, improved by 144 basis points to 94.65%. The bank’s credit cost for the quarter stood at 0.55%. These improvements suggest a reduction in credit stress within the portfolio, supporting the bank’s capital position.
The bank’s global business expanded 17.2% year-on-year to Rs 32.57 lakh crore as of September 30, 2026. Global deposits grew 16.4% to Rs 17.45 lakh crore, while global advances increased 18.3% to Rs 15.12 lakh crore. Domestically, deposits rose 16.6% to Rs 14.83 lakh crore, and advances grew 13.5% to Rs 11.87 lakh crore. The global net interest margin (NIM) stood at 2.74% during the quarter, compared with 2.96% in Q2 FY26, indicating a slight compression in spread despite volume growth.
Growth in priority sectors remained robust. The retail, agriculture, and micro, small, and medium enterprises (MSME) portfolio grew 18% year-on-year, accounting for 64.2% of domestic advances. Within the retail segment, auto loans grew 27.8%, mortgage loans 20.3%, home loans 14.6%, and education loans 9.9%. The agriculture loan portfolio increased 19% to Rs 2.01 lakh crore, while the organic MSME portfolio grew 21.3% to Rs 1.75 lakh crore. These figures highlight the bank’s continued focus on priority sector lending and retail diversification.
The next data release for Bank of Baroda will be its Q3 FY27 earnings report, expected in early January 2027. Investors will be watching closely to determine if the strong Q2 performance, particularly in asset quality and retail lending, can be sustained without the benefit of the one-off NSE stake sale gains.
