BoB shares tumble over 6% in two days after ₹5,700-crore NMC settlement; Nomura flags Q1 earnings hit

Shares of Bank of Baroda (BoB) fell 2% on Friday after the state-owned lender agreed to pay $600 million (around ₹5,700 crore) to settle a long-running legal dispute linked to the collapse of the UAE-based healthcare group NMC Health. The settlement is believed to be the largest out-of-court legal payout by an Indian public sector bank, particularly in a foreign or cross-border litigation case.

Extending their losing streak for the second consecutive session, Bank of Baroda shares fell by as much as 2% to ₹254.85 on Friday, dragging the lender's market capitalisation down to around ₹1.32 lakh crore. The stock has declined more than 6% over the past two trading sessions since the bank announced the settlement. On Thursday, the public sector bank's shares closed 4.2% lower at ₹260.25 on the BSE.

In a regulatory filing on Thursday, the bank said it had entered into an out-of-court settlement with the joint administrators of NMC Health PLC, NMC Healthcare, and NMC Holding. The agreement brings to a close proceedings before the Abu Dhabi Global Market (ADGM) Court of First Instance and the High Court of Justice of England & Wales.

The litigation related to insolvency proceedings involving the NMC group under ADGM and UK insolvency laws, as well as UAE civil law.

The bank clarified that all claims and causes of action between the parties have been resolved without any admission of liability or wrongdoing.

"The settlement agreement and its terms otherwise remain confidential. The liability of the bank in these proceedings is limited to this sum," the lender said in its filing.

Pursuant to the agreement, the ADGM proceedings have been discontinued, while the English proceedings are in the process of being withdrawn, the bank said.

Nomura expects Q1 earnings impact

Following the settlement, Nomura retained its 'Neutral' rating on Bank of Baroda. The brokerage noted that the $600 million settlement amounts to nearly 4% of the bank's net worth.

Nomura expects the one-time payout to weigh on the bank's June quarter earnings, as the provision is likely to be recognised in Q1FY27.

The settlement brings an end to one of the legal overhangs arising from the collapse of NMC Health, which was once one of the largest private healthcare providers in the Gulf region before allegations of financial irregularities surfaced in 2020.

Business growth remains robust

Separately, Bank of Baroda reported strong provisional business updates for the first quarter of FY27, indicating continued momentum in loan and deposit growth.

The bank's global business expanded 15.46% year-on-year to ₹30.51 lakh crore as of June 30, 2026. Global advances rose 17.42% to ₹14.17 lakh crore, while global deposits increased 13.81% to ₹16.34 lakh crore.

On the domestic front, advances grew 16.14% year-on-year to ₹11.51 lakh crore, while domestic deposits rose 14.74% to ₹13.82 lakh crore.

Retail lending continued to outpace the overall loan book, with domestic retail advances rising 18.45% year-on-year to ₹3.10 lakh crore, reflecting sustained demand across housing, vehicle, and personal loan segments.

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