The company expect loan book growth of 15% in FY19, said PS Jayakumar, Managing Director and Chief Executive Officer, Bank of Baroda (BoB).
“In a worst case scenario, Q1 and Q2 may be flat on earnings but Q3 and Q4 would see likely healthy earnings growth, he said.
Speaking to CNBC-TV18, Jayakumar said, “Overall would like to stay with the view that an asset growth of around 15% and close to double-digit return on equity is likely.”
“The watch list of Rs 10,000 crore includes, Special Mention Accounts (SMA) 1 and SMA 2 and also some of the restructured portfolio,” he said.
Jayakumar said that while slippages were high in the last year and year before that, the recoveries were also not to the mark. But now, one is hoping that the National Company Law Tribunal (NCLT) will give some momentum in terms of getting recoveries to a better state than they were before.
“So, surprises if any on the negative side would also be made good by better recoveries compared to last.”
He said the bank’s exposure to power is under 2.50% of loan book. However, the bank has factored in some of the power projects as never seeing light of the day, he said.
Talking about the change of guard, the CEO said there are succession plan to all the operating levels and the board frequently documents and reviews succession plans. Moreover, the bank has heavily invested in leadership training programme.
“It has been an enjoyable experience working in the company and is deeply committed to any opportunities in supporting BoB,” Jayakumar added.
State-owned Bank of Baroda reported a net loss of Rs 3,102.34 crore for the January-March quarter of 2017-18 due to higher provisioning for mounting bad loans.
The lender had registered a net profit of Rs 154.72 crore in the corresponding quarter of 2016-17.
The domestic loan growth was at its best and the low cost deposit share at the highest in eight quarters.
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