Bank of Baroda Q2 Results: Record Profit of ₹6,532 Crore, Up 35.8%

Bank of Baroda Q2 results showed a 35.8% year-on-year increase in the state-owned lender’s standalone net profit to ₹6,532 crore, its highest-ever quarterly profit. The jump was helped by non-interest income, which almost doubled. Net profit was ₹4,809 crore in the same period last year.

The board approved the results for the quarter ended September 30, 2026, on Friday. Net interest income (NII), or interest earned on loans minus interest paid on deposits, grew 9% to ₹13,026 crore from ₹11,954 crore a year earlier.

One of India’s largest public sector banks, the lender is headquartered in Vadodara, and the Government of India owns a majority of its shares. Its results are therefore watched as a benchmark for credit demand and asset quality across public sector banks.

Operating profit increased 50.9% to ₹11,430 crore from ₹7,576 crore. Non-interest income rose 95.8% to ₹6,881 crore from ₹3,515 crore, while operating expenses increased 7.4% to ₹8,477 crore. Provisions for the quarter rose to ₹2,382 crore from ₹1,232 crore a year earlier.

Bank of Baroda Q2 results show cleaner books

Asset quality also improved, with Bank of Baroda NPA ratios falling further. Gross non-performing assets (NPA) fell to 1.78% of advances from 2.16% a year ago and 2% in the June quarter. Net NPA came down to 0.37% from 0.57%.

The slippage ratio fell 22 basis points to 0.69%, while the provision coverage ratio, including technical write-offs, improved 144 basis points to 94.65%. Credit cost was 0.55%.

Return on assets came in at 1.26% compared with 1.07% a year earlier, while return on equity was 19.28%. Capital adequacy stood at 16.61%, with a common equity tier-1 ratio of 14.20%, which leaves the bank room to grow loans. Margins, however, were weaker.

The global net interest margin (NIM) declined to 2.74% from 2.96% a year earlier, even as loans grew at twice the rate of net interest income. Global advances increased 18.3% to ₹15.12 lakh crore, while global deposits grew 16.4% to ₹17.45 lakh crore.

Bank of Baroda net profit backed by retail and MSME loan growth

Total global business increased 17.2% to ₹32.57 lakh crore. Domestic advances rose 13.5% to ₹11.87 lakh crore and domestic deposits 16.6% to ₹14.83 lakh crore. Advances to retail, agriculture and MSME borrowers grew 18%, forming 64.2% of domestic advances.

Within retail, auto loans grew 27.8%, mortgage loans 20.3%, home loans 14.6% and education loans 9.9%. The agriculture book increased 19% to ₹2.01 lakh crore, and the organic MSME portfolio rose 21.3% to ₹1.75 lakh crore.

Domestic current account and savings account (CASA) deposits increased 10.4% to ₹5,39,515 crore, slower than total deposit growth. A higher share of term deposits, which cost more, could raise the cost of funds in the next few quarters.

The Bank of Baroda Q2 results add to a run of strong PSU bank results for the September quarter. Punjab National Bank also posted a 12.8% rise in net profit to ₹5,532 crore, with its gross NPA ratio easing to 2.55%.

For borrowers, the 18.3% increase in advances indicates that state-run banks are growing loans to consumers and smaller businesses. For investors, the margin trend is the number to watch, as a large share of this quarter’s profit growth came from non-interest income.

Non-interest income at banks includes items such as treasury profits, fees and recoveries on written-off loans. It can vary greatly from quarter to quarter, so the sustainability of this record profit remains to be seen.

Investors will want to hear from management on margins and the cost of deposits for the second half of FY27, and on whether loan growth can continue without fresh slippages. The stock is expected to react when markets open on Monday. The bank’s filings are available on the BSE corporate announcements page.