Bank of India: Profits Soar Amid Challenging Margins

State-owned Bank of India reported a substantial 32% increase in net profit for the June quarter, reaching Rs 2,252 crore, primarily attributed to treasury gains. Despite a 3% decline in core net interest income to Rs 6,068 crore and a 0.52% dip in net interest margin (NIM) to 2.55%, global advances increased by 12%.

Bank's managing director and chief executive, Rajneesh Karnatak, noted that while NIMs have bottomed out, they remain under pressure amid RBI's rate cuts. He anticipates that future loan seasons and NIM improvements will drive profit growth. The bank's retail segment expanded by nearly 20%, though corporate loans slowed due to pricing pressures.

With a projected loan pipeline of Rs 80,000 crore, including Rs 70,000 crore in corporate loans, BoI aims for an overall loan growth target of 12-13% for FY26. The bank's capital adequacy stands at 17.39% as of June 30, with no plans for fresh capital raising.

(With inputs from agencies.)