Npa Analysis of Bank of Baroda 2011 -12

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Bank again proved its strength in the asset quality management by restricting its Gross NPA ratio at 1.53% and Net NPA ratio at 0.54% during FY12 – one of the lowest in the large sized banking segment in India. The Bank’s Loan Loss Coverage Ratio (including technical write-offs) too stood at the pristine level of 80.05% as on 31st March 2012. Net NPAs to Net Advances stood at 0.54% this year against 0.35% last year. Gross NPA ratio of the Indian banking industry worsened by 59 basis points (bps) between end-Mar, 2011 to end-Dec, 2011 due to continued economic stresses and capital to risk-weighted asset ratio (CRAR) of Banking industry deteriorated by 91 bps during the said period. These factors appear to have negatively impacted the Banking sector’s capacity to extend credit during FY12. As a result, there was a compositional shift in Banks’ asset portfolio in favor of investments in government securities.

Retail Business
As in the past, Retail Business continued to be one of the important segments of overall business during FY12. Bank’s performance under its Retail Banking Segment during the year under consideration is as under.

NPA under the Retail Loan
The amount of Non Performing Assets as on 31st Mar, 2012 under Retail Loan was Rs 682 crore (1.91%) versus the level of Rs. 662 crore (2.13%) as on 31st Dec, 2011 and Rs 649 crore (2.17%) as on 30th Sept, 2011. As on 31st Mar, 2011,the NPA was at the level of Rs 580 crore(1.79%).

Gross Advances during the year increased by 43.73% over the level of Mar’11, which means your Bank, could maintain the healthy growth trend even during the challenging times. There were a few slippages and the Gross NPAs of your Bank as percentage to Total Advances marginally increased from 0.62% as of Mar’11 to 0.68% as on Mar’12.

Asset Quality Management
The year FY12 has been a challenging year for the banking industry to maintain the Asset Quality due to a fragile economic environment. However, your Bank has continued...
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