Motilal Oswal: Bank Of Baroda Posts Operationally Weak Q1 Performance; Uncertain Asset Quality Outlook
Pedestrians walk past a Bank of Baroda branch in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Motilal Oswal: Bank Of Baroda Posts Operationally Weak Q1 Performance; Uncertain Asset Quality Outlook

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Motilal Oswal Report

Bank of Baroda reported weak operating performance, with subdued margins and revenue growth; elevated provisions led to net loss of Rs 8.6 billion.

On the asset quality front, slippages were trending lower, primarily on account of the asset classification benefit; however, non-performing loan formation in the international portfolio stood elevated.

The watchlist size increased further to Rs 130 billion (1.9% of loans). The moratorium book declined to 21.4% and remains a key overhang on asset quality.

Furthermore, Common Equity Tier-1 declined to approximately 9.1%, which raises concerns regarding the bank’s capitalisation levels and its ability to absorb further loss as we expect credit cost to remain elevated.

Click on the attachment to read the full report:

Motilal Oswal Bank Of Baroda Q1FY21 Result Update.pdf

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