Debadatta Chand, MD & CEO, NMC Group
Bank of Baroda (BoB) reported a 72 per cent year-on-year (y-o-y) drop in first quarter (Q1FY27) standalone net profit at ₹1,278 crore against ₹4,541 crore, with the bottomline being impacted by one-off exceptional payment amounting to $600 million due settlement in respect of the collapsed UAE-based NMC Group.
Excluding the aforementioned impact of ₹5,680 crore, the public sector bank’s net profit would have been ₹5,528 crore.
Elaborating on the reasons for entering into a settlement with the Administrators of entities within the NMC Group, MD & CEO Debadatta Chand said: “The (settlement) decision was taken after carefully evaluating the matter from a commercial perspective. The settlement has been concluded without any admission of liability or wrongdoing.
“The bank believed it had a strong basis for entering into the settlement. Since the matter remains sub-judice with respect to other defendants, the settlement terms are confidential.”
He emphasised that resolving this long-pending litigation removes a significant legacy overhang and strengthens the bank’s balance sheet by eliminating a longstanding uncertainty.
Undisclosed debt
The NMC Group was put under administration in 2020 after investigators uncovered billions of dollars in undisclosed debt and evidence of alleged fraud. The joint administrators of the collapsed NMC Health alleged that BoB’s UAE operations had facilitated certain financing arrangements, enabling the company to conceal debt. The bank has denied any wrongdoing in this case.
On mobilising resources that can be swapped with the RBI under its special window, Chand expects to raise around $4-5 billion across the three instruments—Foreign Currency Non-Resident (Bank)/ FCNR (B) deposits, Medium-Term Notes (MTNs) and Overseas Foreign Currency Borrowings (OFCBs)
“As of today, we have mobilised close to $700 million through FCNR(B) deposits and we expect this to exceed $1 billion by month-end. Based on the current traction, we remain confident of achieving our original target of raising around $4–5 billion before the window closes,” he said.
Income down
In the reporting quarter, net interest income (difference between interest earned and interest expended) was up 9.5 per cent ₹12,524 crore ( ₹11.435 crore in the year ago period).
Other income, including fee-based income, treasury income and recovery in written-off accounts, declined 26 per cent y-o-y to ₹3,470 crore (₹4,675 crore). Within this, treasury income was sharply lower at about ₹800 crore (₹2,016 crore).
BoB’s Chief said the decline in treasury income was partially offset by PSLC (priority sedctor lending certificate) sales, which the bank sold for the first time, contributing around ₹270 crore. Additionally, the recovery from written-off accounts exceeded ₹1,000 crore (compared with around ₹650-700 crore in earlier quarters) during the quarter.
The provision for non-performing assets( NPA) and bad debts written off declined 38 per cent y-o-y to ₹1,043 crore (₹1,686 crore). Global net interest margin (NIM) was lower at 2.77 per cent against 2.91 per cent in the year ago period.
Business growth
Global deposits rose 13.8 per cent y-o-y to ₹16,33,559 crore as at June-end 2025, with domestic deposits and international deposits rising 14.7 per cent and 8.9 per cent, respectively.
Global advances increased by 17.4 per cent y-o-y to ₹14,16,898 crore, with domestic gross advances and international advances rising by 16.1 per cent and 23.3 per cent, respectively.
Within domestic advances, MSME (20.3 per cent), agriculture (18.7 per cent), retail (growth 18.4 per cent) and corporate advances (15.3 per cent) saw a robust growth.
Chand sees deposits and advances growing 10-12 per cent and 14-16 per cent, respectively, and expects the NIM to stay in the 2.75-2.95 per cent range in FY26.
Published on July 24, 2026
