Bank of India reported a 25.3 percent jump in quarterly profit to ₹3,202 crore, driven by strong operating income and recoveries from old bad loans. The bank also showed significant improvement in asset quality. Investors are tracking these results alongside management's steady growth guidance for the current fiscal year.
Bank of India announced its financial performance for the second quarter of the 2027 fiscal year, reflecting a period of steady growth. The lender reported a net profit of ₹3,202 crore, marking a 25.3 percent increase compared to the same period last year. This performance was supported by a 33.2 percent rise in operating profit, which reached ₹5,089 crore, and a 18.5 percent increase in net interest income—the difference between interest earned and interest paid—to ₹7,007 crore.
Operational Efficiency Drives Profit
A major contributor to the bank's bottom line was the rise in non-interest income, which grew by 24.8 percent to ₹2,770 crore. This growth was notably boosted by a sharp increase in recoveries from accounts that had been previously written off. While the bank's core profitability metrics improved, its net interest margin—a key measure of lending efficiency—moderated slightly to 2.47 percent. The bank explained that this 5-basis-point dip was largely due to holding costs associated with foreign currency deposits, specifically FCNR(B) deposits, which are funds held by banks from non-resident Indians in foreign currencies.
Asset Quality Metrics Improve
The bank reported cleaner balance sheet figures, with gross non-performing assets—or bad loans—dropping to 1.6 percent. This is a significant improvement of 94 basis points compared to previous periods. Furthermore, the bank maintains a provision coverage ratio of 94.45 percent. This figure indicates how much of the bank's bad loans are covered by set-aside funds; a higher percentage generally offers a stronger cushion against future credit losses, which is a metric market participants often monitor to gauge financial health.
FY27 Growth Targets
Looking ahead, the bank has maintained its guidance for the 2027 fiscal year. Management is targeting growth in advances—money lent out—between 15 percent and 16 percent, and deposit growth in the range of 16 percent to 17 percent. The bank’s global business has expanded by 21.1 percent, reaching ₹18.93 lakh crore, with retail lending specifically showing a 19.3 percent growth rate.
For investors and analysts, the next important updates will involve tracking whether the bank can maintain this pace of loan recovery and if its lending margins stabilize in the coming quarters. The ability of the bank to balance credit expansion with strict risk management, especially as it grows its retail loan book, will remain a primary focus.