Bank of Baroda:
Consistently Sound Performance Achieved through
Best Practices of People, Processes & Technology
Performance Analysis: Q2 & H1, 2012-13 (FY13)
Dr Rupa Rege Nitsure
Chief Economist
October 22, 2012
Bank of Baroda: Key strengths
Bank of Baroda is a 104 years old State-owned Bank with modern & contemporary personality,
offering banking products and services to Large Industrial, SME, Retail & Agricultural customers
across India and 24 other countries.
Uninterrupted Record
in Profit-making and
Dividend Payment
Overseas Business
Operations extend across
24 countries
through 96 Offices
Strong Domestic
Presence through
4,021 Branches
Pioneer in many
Customer-Centric
Initiatives
Provides Financial
Services to over
47 mln Customers
Globally
First PSB to receive
Corporate Governance
Rating (CGR-2)
A well-accepted &
recognised Brand in
Indian banking industry
Modern & Contemporary
Personality
Relatively Strong Presence
in Progressive States like
Gujarat & Maharashtra
Robust Technology
Platform with 100%
CBS in Indian Branches
Results at a glance
Q2, FY13
H1, FY13
•Net Profit up 11.6%(y-o-y) to Rs 1,301.39
crore
•Net Profit up 11.0%(y-o-y) to Rs 2,440.25
crore
•Operating Profit up 11.3% (y-o-y) to Rs
2,382.58 crore
•Operating Profit up 16.7% (y-o-y) to Rs
4,635.76 crore
•Net Interest Income up 11.5% (y-o-y) to Rs
2,862.30 crore
•Net Interest Income up 16.4% (y-o-y) to
Rs 5,660.37 crore
•NIM at 2.71% in Global & at 3.23% in
Domestic operations
•NIM at 2.73% in Global & at 3.22% in
Domestic operations
•ROAA (annualized) at 1.12%
•ROAA (annualized) at 1.06%
•Total Business up 23.2% (y-o-y) to Rs 7,00,330 crore by end-Sept, 2012
•Total Advances up 22.2% (y-o-y) to Rs 2,92,181 crore by end-Sept, 2012
•Total Deposits up 24.0% (y-o-y) to Rs 4,08,150 crore by end-Sept, 2012
•Net NPAs (%) at 0.82% as on 30th Sept, 2012
•Provision Coverage Ratio at the healthy level of 75.72% as on 30th Sept, 2012
•CRAR at 12.91% with Tier 1 at 9.57% as on 30th Sept, 2012
•Cost-Income ratio at 36.48% in H1, FY13.
Sustained sound performance from FY08
2007-08
(Annual)
2008-09
(Annual)
2009-10
(Annual)
2010-11
(Annual)
2011-12
(Annual)
H1, 2012-13
(Half-Yearly)
Assets
(Rs crore)
1,83,479
2,26,672
2,78,317
3,58,397
4,47,321
4,75,827
Net Profit
(Rs crore)
1,436
2,227
3,058
4,242
5,007
2,440.25
Tier 1 Capital
(Rs crore)
8,496
11,070
14,357
20,974
27,498
26,712
Return on
Equity (%)
15.07%
19.48%
22.19%
21.48%
19.04%
16.90%
Cost-Income
Ratio (%)
50.89%
45.38%
43.57%
39.87%
37.55%
36.48%
NPL (Net, %)
0.47%
0.31%
0.34%
0.35%
0.54%
0.82%
•In four & a half yrs, Bank’s assets have grown 2.6 times.
•Bank’s half-yearly net profit in H1, FY13 is bigger than its full year’s profit in FY09.
Impressive CAGR for key parameters (FY08 thru’ FY12)
Parameter
CAGR
(FY08 thru’FY12)
Assets
24.96%
Gross Profit
31.02%
Net Profit
36.65%
Net Worth
28.90%
Total Capital
26.84%
Tier-1 Capital
34.13%
Sustained expansion of global branch network
4500
3904
4000
3500
3364
2974
3000
2853
2899
3100
3959
4021
4078
3418
3148
2926
2500
2000
1500
1000
500
0
FY'08
FY'09
Domestic Brs
FY'10
FY'11
FY'12
Global Brs
H1, FY13
Features of domestic branch network
•In a year’s time (Sept’11 to Sept’12), the Bank added 529 brs to its domestic network comprising
120 in metro; 76 in urban; 205 in semi-urban & 128 in rural areas.
•During H1, FY13, the Bank opened 118 new brs (11 in metro, 10 in urban, 38 in semi-urban and
59 in rural areas) and merged one rural br in June, 2012 & converted that into a satellite unit.
•In the remaining part of FY13, the Bank plans to open 475 new brs with 241 brs in Tier-I & Tier-II
centres & 234 brs in Tier-III to Tier-VI centres.
•Newly opened branches in H1, FY13 majorly belong to Eastern UP, Rajasthan, Maharashtra, Gujarat
& Eastern states.
•Around 33.03% of the Bank’s network at the end-Sept, FY13 was situated in rural areas.
•Moreover, the Bank’s ATM tally improved from 1,800 at end-Sept, 2011 to 2,230 at end-June,
2012.
Regional Break-up of
Domestic Branches as on 30th Sept, 2012
Metro
Urban
Semi-Urban
Rural
885
725
1,083
1,328
Deepening of overseas business ..
No. branches, offices, countries
120
100
80
72
72
74
74
74
76
78
78
81
81
60
47
48
46
48
48
48
48
50
48
82
54
51
50
85
86
54
86
54
86
89
55
54
96
93
57
55
40
25
25
25
25
25
25
25
25
26
26
25
25
25
25
24
24
24
20
0
Overseas Branches
Number of Overseas Offices
Number of Countries where present
24
Other strengths: Robust technology platform
•Bank’s entire domestic, overseas and RRBs Framework is CBS-compliant
•All domestic branches are migrated to MPLS (Multi-Protocol Label Switching) network. New branches
are directly opened in MPLS network
•Bank has IT facilities for online/offline account opening through Business Correspondents under
Financial Inclusion.
•Bank’s retail e-banking portal has been made more use-friendly through enhancement of its look &
feel for customers.
•Bank has implemented Internet Banking in 12 of its overseas territories , notably Oman, Tanzania,
Uganda, Kenya, Mauritius, Seychelles, Botswana, New Zealand, UAE, Fiji, UK & Ghana.
•For provision of Safe Online Banking & to protect customers from Phishing Attacks, the Bank has
implemented a Fraud Management Solution. A SMS alerts facility is also being provided to customers
•Bank has implemented a RaidFunds2India solution in all its major territories.
•Bank’s Mobile Banking (Baroda M-Connect) provides various facilities to its customers like balanceenquiry, mini-statements, linking of multiple accounts, funds’ transfer, bill payments, ticket booking,
shopping, feedback facilities, etc. The IMPS facility is also being introduced for its customers.
•Bank’s Mobile Banking application is available on all Leading Brands including Blackberry, Android,
iPhone and Windows; National Unified USSD Platform also being enabled thru’ mobile banking.
•Internet Payment Gateway is implemented by the Bank to facilitate E-commerce Transactions in
multi currencies across the globe.
Other strengths: Robust technology platform
•Bank’s ATM Switch is upgraded to handle increasing volume of ATM transactions ; the Bank’s ATM
count has increased to 2,230 by 30th Sept, 2012; its ATM switch also supports eight international
territories.
•Bank has introduced a Rupay card.
•Bank has a Facility of Multiple Accounts being linked to a single Debit Card (verified by Visa, CVV2)
and also a Mobile Number registration thru’ ATMs in CBS for the SMS Alerts.
•E-tax payments thru’ ATMs are also facilitated by the Bank and Mobile ATMs are introduced in several
cities.
•Bank has set up two Contact Centres in Lucknow & Baroda to address customer queries and
grievances speedily.
•Cash Management Solution is implemented to provide Operational Support to the Customers’ ALM.
•Anti Money Laundering (AML) is implemented in India and 21 of the Bank’s overseas territories.
•Bank has developed an Integrated Global Treasury Solution in its major territories like U.K., UAE,
Bahamas, Bahrain, Hong Kong, Singapore, Belgium, USA and India to reduce the cost of operations and
improve the fund management.
• Bank has a Centralised SWIFT system for India & its 22 overseas territories.
•The CTS -Cheque Truncation System is implemented in Delhi and a Grid based CTS System is
implemented in Chennai, Coimbatore and Bangalore.
•Online Trading (Corporate & Retail) has been implemented in India.
Other strengths: Robust technology platform
•ACPC (Automated Cheque Processing Centre) for centralised Inward / Outward clearing has been
implemented in Mumbai, Surat and Ahmedabad regions of the Bank.
•Back Office functions are centralised in the Bank at its City Back Offices & ten Regional Back Offices
(at Baroda, Jaipur, Lucknow, Bhopal, Coimbtore, Kolkata, Mumbai, Jamshedpur, New Delhi, Pune) to
improve the service delivery to customers.
•RTGS & NEFT straight through processing has been implemented for all sponsored RRBs of the Bank.
•Bank’s intranet portal is revamped into a complete Knowledge Mgmt Solution for the employees’
benefit.
•Travel card has been introduced in Foreign Currency.
•Online loan applications have been rolled out for SME, Agriculture, Housing, Educational & Auto loans
along with the facility of online tracking of these applications.
•Bank has built a State-of-the-Art Data Centre conforming to Uptime Institute Tier-3 standard and a
Disaster Recovery Site in different seismic zones to ensure uninterrupted banking services to its
customers.
•Various Technology projects like Virtualisation, Back-up Consolidation & RAC (Realtime Application
Cluster) are being undertaken to support increasing business requirement.
•BoB IIT – an exclusive IT Training Centre has been set up in Ghandhinagar to educate the Bank’s Staff
in all IT related products & services.
Other strengths: Rich human resource base ….
Period
No. of Employees
No. of Officers
Q1, FY09
36,344
13,643
Ratio of Officers to Total
Employees
37.5%
Q2, FY09
36,255
13,615
37.6%
Q3, FY09
36,045
13,502
37.5%
Q4, FY09
36,838
13,346
36.2%
Q1, FY10
37,007
14,163
38.3%
Q2, FY10
38,609
14,378
37.2%
Q3, FY10
37,039
14,358
38.8%
Q4,FY10
38,960
14,431
37.0%
Q1, FY11
38,551
14,335
37.2%
Q2, FY11
38,724
15,148
39.1%
Q3, FY11
38,629
15,838
41.0%
Q4, FY11
40,046
15,759
39.4%
Q1, FY12
40,250
15,681
39.0%
Q2, FY12
40,967
16,426
40.1%
Q3, FY12
41,345
16,646
40.3%
Q4, FY12
42175
16,953
40.2%
Q1, FY13
42,136
16,991
40.3%
Q2, FY13
43,587
17,316
39.7%
Other strengths: Steady improvement in capital strength
Capital Adequacy Ratio
(Basel-II)
Tier-I (%)
Tier-II (%)
Q1, FY09
13.04%
7.79%
5.25%
Q2, FY09
12.57%
7.57%
5.00%
Q3, FY09
13.20%
8.53%
4.67%
Q4, FY09
14.05%
8.49%
5.56%
Q1, FY10
14.56%
8.81%
5.75%
Q2, FY10
14.67%
8.86%
5.81%
Q3, FY10
14.65%
9.31%
5.34%
Q4,FY10
14.36%
9.20%
5.16%
Q1, FY11
13.25%
8.16%
5.09%
Q2, FY11
13.22%
8.16%
5.06%
Q3, FY11
12.45%
7.70%
4.75%
Q4, FY11
14.52%
9.99%
4.53%
Q1, FY12
13.10%
9.06%
4.04%
Q2, FY12
12.73%
8.82%
3.91%
Q3, FY12
13.45%
9.31%
4.14%
Q4, FY12
14.67%
10.83%
3.84%
Q1, FY13
13.74%
10.13%
3.61%
Q2, FY13
12.91%
9.57%
3.34%
Other strengths: Relatively stronger presence in progressive states
Gujarat, 20.6
Rest of India, 23.3
Maharashtra, 11.8
UP & Uttaranchal,
22.0
South, 11.1
Rajasthan, 11.2
Pattern of shareholding: 30th Sept, 2012
Indian
Public
4.80%
Corp.
Bodies
6.20%
As on 30th Sept, 2012
•Share Capital: Rs 412.38 crore
Others
0.45%
•No. of Shares:
• Net worth:
FIIs
15.37%
• B. V. per share:
411.12 million
Rs 28,880.09 crore (up 28.7% , y-o-y)
Rs 702.47 (up 22.6%, y-o-y)
•Return on Equity: 16.9% in H1 & 18.02% in Q2, FY13
Govt. of
India
54.31%
Insurance
Cos
12.87%
Mutual
Funds
6.00%
• BOB is a Part of the following Indexes
BSE 100, BSE 200, BSE 500 & Bankex
Nifty, BankNifty, CNX 100, CNX 200, CNX 500
• BOB’s Share is also listed on BSE and NSE in the
‘Future and Options’ segment.
Sustained growth in financial value
Period
Net Worth
Growth Rate
(y-o-y)
Q1, FY09
9,907
13.05%
Q2, FY09
10,304
13.44%
Q3, FY09
11,011
14.84%
Q4, FY09
11,387
19.52%
Q1, FY10
12,067
21.80%
Q2, FY10
12,703
23.28%
Q3, FY10
13,533
22.90%
Q4,FY10
13,785
21.06%
Q1, FY11
14,646
21.37%
Q2, FY11
15,669
23.35%
Q3, FY11
16,741
23.70%
Q4, FY11
19,751
43.28%
Q1, FY12
20,785
41.92%
Q2, FY12
22,440
43.21%
Q3, FY12
24,169
44.37%
Q4, FY12
26,303
33.18%
Q1, FY13
27,889
34.20%
Q2, FY13
28,880
28.70%
Bank has performed consistently well
despite a non-supportive macro backdrop
Economic Indicator
Q2, FY12
Q3, FY12
Q4, FY12
Q1, FY13
Q2, FY13
Real GDP growth (%)
6.7
6.1
5.3
5.5
NA
Agriculture (%)
3.1
2.8
1.7
2.9
NA
Industry (%)
2.8
0.8
0.7
0.8
NA
Services (%)
8.7
8.7
7.5
7.4
NA
Private Consumption Expenditure
growth (%) (at current market
prices)
14.1
15.2
13.9
12.6
NA
Gross Fixed Capital Formation (% to
GDP) (at current market prices)
30.9
27.8
28.6
29.9
NA
SCB Credit growth (%, Avg Basis)
20.0
17.9
16.8
17.7
16.7
SCB Deposit growth (%, Avg Basis)
18.0
16.8
15.3
13.8
14.2
SCB Incremental Credit-Deposit
Ratio (%, end-period)
55.0
68.3
84.3
46.6
46.2
WPI-Inflation, Core Inflation (%)
(end-period)
10.00
(7.99)
7.74
(7.91)
7.69
(4.96)
7.25
(4.85)
7.81
(5.56)
Trade Balance ( US $ Billion)
-43.9
-47.7
-51.7
-42.50
-49.3
Rupee-USD (%, end-period)
48.97
53.10
50.88
55.60
52.86
Foreign Exchange Reserves (endperiod, US $ Billion)
311.48
296.69
294.40
289.99
294.81
Total business growth from FY09..
800,000
672248
700,000
700330
668552
600,000
534116
482211
500,000
416297
300,000
316928
259958
194726
190038
200,000
100,000
491561
402731
400,000
335,648
473825
75,690
99,152
208769
131385
0
FY09
FY10
Total Business
FY11
Domestic Business
FY12
Q1, FY13
Q2, FY13
Overseas Business
•In just three & a half years, the Bank’s total business has more than doubled.
Total deposit growth from FY09..
450000
408149
384871
400000
382739
350000
305439
300000
280135
241044
250000
200000
150000
192397
277839
233323
185283
151409
104899
104736
100000
50000
292877
40,988
55,762
115273
72,116
0
FY09
FY10
Total Deposits
FY11
Domestic Deposits
FY12
Q1, FY13
Q2, FY13
Overseas Deposits
•In just three & a half years, the Bank’s total deposits have grown 2.12 times.
Relatively well-protected domestic CASA share
120,000
45%
105259
40%
39.81%
100,000
35%
31.75%
80,000
30%
25%
60,000
20%
49,290
40,000
16.72%
15%
15.02%
10%
20,000
5%
0
0%
CASA Deposits
CASA as % to Dom. Dep.
CASA Deposits Growth Rate (y-o-y)
Total advances growth from FY09..
300,000
250,000
287377
285813
292181
40.00%
35.00%
34.25%
228676
30.00%
200,000
175035
150,000
143251
25.70%
30.70%
25.00%
23.00%
22.19%
22.19%
20.00%
15.00%
100,000
10.00%
50,000
5.00%
0
0.00%
FY09
FY10
Net Advances
FY11
FY12
Q1, FY13
Q2, FY13
Net Advances Growth Rate (y-o-y)
•In just three & a half years, the Bank’s total advances (net terms) have also
more than doubled.
Steady gains in market share …..
4.40%
4.32%
4.20%
4.18%
4.00%
3.80%
3.63%
3.60%
3.40%
3.42%
3.20%
3.00%
Deposits Domestic Market Share
Advances Domestic Market Share
Consistency in profit-making
5000.00
Rs crore
4500.00
•During the last five years, the Bank’s Half-yearly Net Profit
has grown at the rich CAGR of 30.0%.
4610.88
3945.23
4000.00
3500.00
3184.61
3000.00
2440.25
2500.00
2198.92
1878.46
2041.53
2000.00
1585.81
1500.00
1319.56
1281.70
1000.00
658.13
766.14
500.00
0.00
Sep'07
Sep'08
Gross Profit
Sep'09
Sep'10
Sep'11
Net Profit
Sep'12
Relatively lower NPL ratios in the industry
Period
Q1, FY09
Q2, FY09
Q3, FY09
Q4, FY09
Q1, FY10
Q2, FY10
Q3, FY10
Q4,FY10
Q1, FY11
Q2, FY11
Q3, FY11
Q4, FY11
Q1, FY12
Q2, FY12
Q3, FY12
Q4, FY12
Q1, FY13
Q2, FY13
Gross
NPA
(%)
1.86%
1.62%
1.50%
1.27%
1.44%
1.30%
1.43%
1.36%
1.41%
1.39%
1.32%
1.36%
1.46%
1.41%
1.48%
1.53%
1.84%
1.98%
Net
NPA
(%)
0.52%
0.43%
0.37%
0.31%
0.27%
0.27%
0.31%
0.34%
0.39%
0.38%
0.36%
0.35%
0.44%
0.47%
0.51%
0.54%
0.65%
0.82%
Bank’s business: Sept’11 to Sept’12
Sept’12
Y-O-Y
(%)
Change
Over
Mar’12 (%)
6,72,248
7,00,330
23.2
4.2
4,13,753
4,82,211
4,91,561
18.8
1.9
Overseas Business
1,54,552
1,90,038
2,08,769
35.1
9.9
Global Deposits
3,29,185
3,84,871
4,08,150
24.0
6.0
Domestic Deposits
2,44,720
2,80,135
2,92,877
19.7
4.5
Overseas Deposits
84,466
1,04,736
1,15,273
36.5
10.1
Global CASA Deposits
90,179
1,03,524
1,05,259
16.7
1.7
Domestic CASA
83,250
92,948
92,979
11.7
0.03
Overseas CASA
6,929
10,576
12,280
77.2
16.1
Particular
(Rs crore)
Sept’11
Mar’12
Global Business
5,68,306
Domestic Business
•Share of Domestic CASA was at 31.75% in terms of Aggregate Deposits and at 33.43% in
terms of Core Deposits as on 30th Sept, 2012.
Bank’s business: Sept’11 to Sept’12
Sept’12
Y-O-Y
(%)
Change
Over
Mar’12 (%)
2,87,377
2,92,181
22.2
1.7
1,69,034
2,02,075
1,98,685
17.5
-1.7
Overseas Advances
70,087
85,302
93,496
33.4
9.6
Retail Credit
Of which:
29,885
35,668
34,245
14.6
-4.0
13,304
14,133
14,789
11.2
4.6
SME Credit
30,149
34,512
36,915
22.4
7.0
Farm Credit*
22,043
29,036
25,735
16.8
-11.4
Credit to Weaker
Sections*
13,650
15,863
14,780
8.3
-6.8
Particular
(Rs crore)
Sept’11
Mar’12
Global advances (Net)
2,39,120
Domestic Advances
Home Loans
* As of Last Reporting Friday
Bank’s business: Sept’11 to Sept’12
Sept’12
Y-O-Y
(%)
Change
Over
Mar’12 (%)
74,580
77,824
13.5
4.3
67,013
72,575
75,821
13.1
4.5
Overseas Savings Deposits
1,528
2,004
2,002
31.1
-0.1
Global Current Deposits
21,639
28,944
27,436
26.8
-5.5
Domestic Current Deposits
16,237
20,372
17,158
5.7
-15.8
5,401
8,572
10,278
90.2
19.9
Particular
(Rs crore)
Sept’11
Mar’12
Global Saving Deposits
68,541
Domestic Savings Deposits
Overseas Current Deposits
Other highlights: Q2,FY12 versus Q2,FY13
Particular (in %)
Q2,
FY12
Q3,
FY12
Q4,
FY12
Q1,
FY13
Q2,
FY13
Global Cost of Deposits
5.61
5.65
5.81
5.89
5.85
Domestic Cost of Deposits
6.84
6.90
7.17
7.30
7.36
Overseas Cost of Deposits
1.82
1.96
1.74
1.86
1.73
Global Yield on Advances
9.64
9.45
9.33
9.08
9.07
Domestic Yield on Advances
12.14
12.01
11.71
11.65
11.75
Overseas Yield on Advances
3.37
3.60
3.75
3.52
3.49
Other highlights: Q2, FY12 versus Q2,FY13
Particular (in %)
Q2,
FY12
Q3,
FY12
Q4,
FY12
Q1,
FY13
Q2,
FY13
Global Yield on Investment
7.58
7.67
7.53
7.71
7.79
Domestic Yield on Investment
7.72
7.79
7.69
7.83
7.92
Overseas Yield on Investment
4.24
4.90
3.84
4.91
4.64
Global NIM
3.07
2.99
2.96
2.73
2.71
Domestic NIM
3.67
3.51
3.44
3.22
3.23
Overseas NIM
1.42
1.64
1.68
1.55
1.54
Key productivity indicators: Q2, FY12 versus Q2, FY13
Particulars
Q2, FY12
Q2, FY13
Business per Employee (Rs crore)
12.98
14.84
Business per Branch (Rs crore)
160.27
171.73
Profit per Employee (Rs lakh)
2.85
2.98
Profit per Branch (Rs lakh)
32.89
31.91
Non-Interest income: Q2, FY12 and Q2, FY13
Q2, FY12
Q2, FY13
% Change
(Y-O-Y)
Commission, Exchange,
Brokerage
313.65
310.40
-1.0
Incidental Charges
74.85
84.88
13.4
Other Miscellaneous Income
66.38
72.36
9.0
Total Fee-Based Income
454.88
467.64
2.8
Trading Gains
10.15
112.02
1003.7
Profit on Exchange Transactions
147.33
183.18
24.3
Recovery from PWO
121.97
65.47
-46.3
Total Non-Interest Income
734.33
828.31
12.8
(Rs crore)
Provisions & contingencies: Q2, FY12 and Q2, FY13
Q2, FY12
Q2, FY13
Absolute
Change
Provision for NPA & Bad Debts
Written-off
298.13
722.93
424.81
Provision for Depreciation on
Investment
144.99
-134.04
-279.03
Provision for Standard Advances
46.92
40.79
-6.13
Other Provisions (including
Provision for staff welfare)
-6.68
16.73
23.41
Tax Provisions
477.54
422.34
-55.20
Total Provisions
960.90
1068.75
107.85
(Rs crore)
Bank’s domestic treasury highlights: Q2, FY12
•
Treasury Income stood at the level of Rs 295.20 crore in Q2, FY13 up 87.5% (y-o-y).
•
Out of this, Trading Gains stood at Rs 112.02 crore in Q2, FY13 as financial market
conditions improved significantly in Q2, FY13.
•
As of Sept 30, 2012, the share of SLR Securities in Total Investment was 84.61%.
•
The Bank had 81.80% of SLR Securities in HTM and 17.95% in AFS at end-Sept 2012.
•
During the year FY13, the Bank shifted SLR securities worth Rs 1,265.42 cr (at book value)
from AFS to HTM on 3rd April and provided Rs 20.69 cr as “depreciation” on shifting.
•
The benchmark G-sec yield at the time of shifting ruled at 8.57%.
•
The per cent of SLR to NDTL as on 30th Sept, 2012 was 27.94%.
•
As on 30th Sept, 2012, the modified duration of AFS investments was 3.52 years & that of
HTM securities was 5.07 years.
•
Total size of Bank’s Domestic Investment Book as on 30th Sept, 2012 stood at Rs 98,375
crore.
Highlights of overseas business: Q2, FY13
•
During H1, FY13, Bank’s “Overseas Business” contributed 29.8% to its Total Business,
24.7% to Gross Profit and 38.9% to Core Fee-based income (i.e., Commission, Exchanges,
brokerage, etc.)
•
Out of the Total Overseas Loan-book, 54.4% was Buyers’ Credit/ Export Credit; 26.3% in
was Syndicated Loans (mostly to Indian corporates) & 19.3% was Local Credit.
•
Less riskiness of the Overseas Loan-book was responsible in keeping Gross NPA (%) in
Overseas Assets at 0.63% as on 30th Sept, 2012.
•
Even the Cost-Income Ratio in Overseas operations was more favourable at 16.44% in H1,
FY13 versus 41.13% in Domestic operations.
•
In Q2, FY13, the NIM (as % of interest-earning assets) in Overseas operations stood at the
healthy level of 1.54%; Gross Profit to Avg. Working Funds ratio at 1.76% and Return on
Equity at 17.26%.
•
During H1, FY13, Bank opened branches in Wellington and Manukau, New Zealand;
Entebbe and Kabale, Uganda, Rose Belle in Mauritius, Tema in Ghana and Sohar in Oman.
NPA movement (Gross): H1, FY13
Particular
( Rs crore)
A. Opening Balance
4,464.75
B. Additions during H1, FY13
2,728.12
Out of which, Fresh Slippages
2,613.34
C. Reduction during H1, FY13
1,313.84
Recovery
298.95
Upgradation
238.07
PWO & WO
773.81
Exchange Difference
NPA as on 30th Sept, 2012
Recovery in PWO in H1, FY12
3.01
5,879.03
148.46
Sector-wise gross NPAs: End-Sept, FY12 & FY13
Sector
Gross NPA (%)
End-Sept, FY12
Gross NPA (%)
End-Sept, FY13
Agriculture
4.58
4.58
Large & Medium
Industries
1.38
1.63
Retail
2.17
2.29
Housing
1.89
1.99
1.65
4.14
3.06
3.55
0.69
0.63
SSI (Mfg)
Total MSME
Overseas Operations
Cumulative position of restructured assets
•
•
During the past 54 months (1 Apr’08 to 30 Sept’12), Bank has restructured 88,288
accounts amounting Rs 16,680.44 crore in its Domestic operations.
•
Within this, the loans worth Rs 933.03 cr were restructured in Q2, FY13; Rs
770.57 cr in Q1, FY13; Rs 8,265.41 cr were restructured in FY12, Rs 1,597.81 cr
were restructured in FY11, Rs 2,455.05 cr in FY10 & Rs 2,658.57 cr in FY09.
•
For the period of 54 months, out of the total amount restructured, Rs 12,582.17
cr (75.4%) belonged to wholesale banking, Rs 2,422.49 cr (14.5%) to SMEs, Rs
620.12 cr (3.7%) to retail and Rs 1,055.66 cr (6.3%) to agriculture sector.
•
About 94 accounts (of Rs 1 crore & above) restructured on/after 1st Apr, 2008
with aggregate outstanding of Rs 1,500.53 cr slipped to NPA after restructuring
and most of them belonged to the SME segment.
In net terms terms, the outstanding amount of restructured loans in the Bank’s
Overseas Business was Rs 4,398.65 crore against 87 accounts as on 30/09/2012.
• Out of these twelve accounts were restructured during H1, FY13 involving the
amount Rs 457.47 crore.
Sectoral deployment of credit at end-Sept, 2012
Sector
% share in Gross
Domestic Credit
Agriculture
12.7
Retail
16.9
SME
18.2
Wholesale
Misc. including
Trade
Total
37.8
14.4
100.0%
Bank’s BPR Project - Navnirmaan
•Project Navnirmaan has altogether 18 activities covering both BPR & Organisational
Restructuring, aimed at transforming the Bank’s branches into a sales & service centres to
make possible a sustained sales growth, superior customer experience and alternate
channel migration.
•The most important initiatives are•Conversion of all metro & urban branches into Baroda Next branches within a
timeline [1,273 branches rolled out so far across 13 zones & 56 regions]
•Creation of automated & lean Back Offices like:
•City Back Office (Automated cheque processing introduced at Mumbai, Surat &
Ahmedabad)
•Regional Back Office [Ten RBOs functioning (one in each zone); five RBOs opened
during FY13]; for CASA opening [No. of brs linked – 2,210]; for issuance of personalised
cheque books [ no. of brs linked – 3,185]. More than 6,500 CASA are being opened per
day.
•Establishment of two Contact (or Call) Centres
•Introduction of frontline automation [Queue Management System & Cheque Deposit
Machines] at select branches for customer convenience
•Creation of an Academy of excellence [Thru’ Training & Boot Camps]
•Organisational Restructuring [ Creation of Selling roles at branch, R.O. & Z.O.]
Bank’s BPR Project - Navnirmaan
•The initial impact of Baroda Next migration has been observed to be rewarding both in
terms of increased customer satisfaction & CASA growth.
•The said impact has been sustained at 110 Baroda Next brs evaluated on sales, customer
satisfaction, etc., during the first stage of evaluation.
•Another evaluation carried out recently at Baroda Next brs on (a) customer satisfaction
[at 177 brs] and (b) employee satisfaction [at 171 brs] showed significant improvement.
•Further evaluation initiatives are on.
•A certification procedure for Baroda Next brs has been introduced for process
compliance/adherence, etc.; CSAT/ESAT externally evaluated by engaging market research
agencies.
•To sustain Sales growth, a new Sales Operating Model has been rolled out in 255 brs in Mumbai,
Surat, Baroda, Ahmedabad, Delhi & Kanpur
•Out of 15 Mid Corporate Brs planned, 14 are already functional and one more is expected to be
opened soon.
•Further centralisation initiatives are going to be piloted soon to enable the brs to become a
“Sales-cum-Service” outlet.
•Bank’s Hi-Tech City Branch at Hyderabad has been transformed into an e-branch.
Bank’s HR initiatives
Recruitment – 2012-13
•Bank’s HR Function has focused on hiring efforts on a sustained basis to bridge the “gap” created by
superannuation and to cater to the Bank’s consistent business growth and branch expansion
•Bank’s Proposed New Hiring in FY13: 3,400 { 2,280 joined up to 30th Sept, 2012}
•Probationary Officers: 600 { 403 joined up to 30/09/12}
•Specialist Officers: 150 { 25 joined up to 30/09/12}
•Baroda Manipal Trainees: 400 { 169 joined up to 30/09/12}
•Campus Recruitment: 250 { 220 joined up to 30/09/12}
•Clerks: 2,000 { 1,463 joined up to 30/09/12}
•Bank carried out a three-month long residential programme involving massive skills’ upgradation for its
new recruits during FY13 with a focus on development of key banking skills covering the major areas like
credit, forex operations, soft skills, etc.
•Other path-breaking initiatives in Employee Development & HR are –
•Baroda Next: A comprehensive leadership development training covering almost 1,500 leaders {all branch
heads of urban/metro branches & AGMs/DGMs in the Bank
•Project Sparsh: A transformational HR project focusing on talent management, succession planning,
creation of a scientific staffing model & manpower planning, capability building & performance management.
•Baroda-Manipal School of Banking: An innovative & new channel of resourcing of trained manpower in the
Bank. Around 180 students are being inducted in this school every quarter for a focused grooming and a oneyear full-time PG Course in Banking that is tailored to the Bank’s specific requirements.
Future Outlook & Guidance
•Recently, India’s government hiked administered domestic diesel prices, resumed privatization &
permitted FDI in multi-brand retail and aviation.
•RBI also cut the CRR, but kept the policy rates unchanged.
• Advancing of long-awaited reforms helped lift the stock market and the rupee.
•Due to delayed monsoon & weak external demand, India likely to grow in the band of 5.2% to 5.5%
in FY13. At present, the growth in non-food credit is in the band of 15.0%-16.0% and deposits in
13.0%-14.0% and M3 around 13.0%.
•Bank of Baroda will continue with its cautious stance and try to grow at 1.0% to 1.5% over the
banking industry’s average growth, given its strong presence in the industrially progressive states and
the support it receives from its overseas operations.
•Strategic thrust will be on protecting the “Financial Soundness” that the Bank has consistently
maintained throughout the past five years vitiated by global financial & economic turbulence.
•With a primary focus on risk management, improvement of systems & controls, liquidity and
capital strength, development of human capital and customer-friendly branch structures, etc.
• Coming to the imminent change in the Top Leadership, I would like to give a quote of Walter
Lippman ( a famous American Writer) – “The final test of a leader is that he leaves behind him in
other men, the conviction and the will to carry on”.
•In the times to come, all Barodians will collectively prove that our revered leaders have passed
the test with flying colours.
Thank you.