Bank of Baroda sees growth in bad loans slowing | Reuters

By Devidutta Tripathy

MUMBAI Bank of Baroda Ltd, India's second-biggest state-controlled lender by assets, expects the rate of growth in bad loans to slow in the coming financial year, a senior banker said on Tuesday.Ashok Garg, an executive director, said the Bank of Baroda expects gross non-performing loans to total about 450 billion rupees ($6.7 billion) in the current year ending in March.That would put the bank within the 50 billion rupees rise in bad loans that it had forecast for the current year, Garg said, adding that incremental bad loans in the next fiscal year would fall below these levels."We are hopeful next year should be a bit better," Garg told Reuters, referring to slippages or additional bad loans.

He said the bank had strengthened its credit monitoring and recovery processes and had a "strong" team on the ground chasing errant borrowers. Altogether, Indian banks had a record $133 billion of restructured debt and bad loans as of last September, according to the Reserve Bank of India. The amount of soured loans surged last year after a clean-up order by the regulator brought more bad debt to light.Bank of Baroda also expects lending growth to gather pace going forward, Garg said, declining to give a specific forecast. The bank is confident it can raise more external capital if it needs to and it could also look at monetising some non-core investments, he said.

Bank of Baroda's investments include a stake in UTI Asset Management, which is preparing for an initial public offering. The bank is also selling a stake in National Stock Exchange, which is expected to list later this year.At least five brokerage firms have downgraded Bank of Baroda's stock since it reported third-quarter earnings last Friday. Of 44 analysts covering the bank, 18 have a 'buy' or equivalent rating, while 13 have a 'sell' the stock, according to Thomson Reuters data.

The stock was little changed on Tuesday, having lost more than 10 percent a day earlier on earnings worries. ($1 = 66.9150 rupees) (Reporting by Devidutta Tripathy; Editing by Greg Mahlich)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date: Feb 14, 2017 22:00 PM

Also Watch

IPL 2018: Royal Challengers Bangalore eye revival against Chennai Super Kings as 'Cauvery Derby' comes back to life
  • Thursday, April 26, 2018 In the Kanjarbhat community, a campaign against 'virginity tests' is slowly gaining ground
  • Tuesday, April 24, 2018 It's A Wrap: Beyond the Clouds stars Ishaan Khatter, Malavika Mohanan in conversation with Parul Sharma
  • Monday, April 9, 2018 48 hours with Huawei P20 Pro: Triple camera offering is set to redefine smartphone imaging
  • Monday, April 16, 2018 Rajyavardhan Singh Rathore interview: Sports can't be anyone's fiefdom, we need an ecosystem to nurture raw talent

Also See