Bank of Baroda shares tanked as much as 10% on the NSE during intraday trade on Tuesday on the back of declines in net interest income and margins despite a surge in consolidated net profits of the bank.

The stock of the public sector lender opened at ₹250 and dropped to a low of ₹224.21, down 10% from the previous close of ₹249.13, following the Q4 results announcements. The stock has risen 3.56% since January.

Bank of Baroda reported a consolidated net profit of ₹5,419.70 crore in Q4FY25, up 5.5% from ₹5,132.45 crore in the same quarter last year. On a standalone basis, the lender posted a 3.3% year-on-year (YoY) rise in net profit to ₹5,048 crore from ₹4,886 crore in Q4FY24. The rise in profits however was not helmed by the bank’s core income, and by other sources of income.  

The bank’s net interest income (NII) declined 6.6% YoY to ₹11,020 crore from ₹11,793 crore in Q4FY24. This was attributed to margin pressures, reflected in the net interest margin (NIM) drop to 2.86% in Q4FY25 from 3.27% in the year-ago quarter. For the full year, NIM fell to 3.02% in FY25 from 3.18% in FY24 — the lowest in 14 quarters.

Despite the dip in NII, non-interest income grew significantly by 24.3% YoY to ₹5,210 crore in Q4FY25, aided by strong gains from treasury and fee-based operations. Segment-wise, treasury operations delivered the highest growth, surging to ₹9,121.77 crore from ₹7,757.01 crore. Retail banking income rose to ₹14,382.14 crore from ₹13,022.07 crore. However, wholesale banking revenue declined to ₹12,773.56 crore from ₹13,611.92 crore. The bank's total income for the March quarter rose 6.15% YoY to ₹35,851.85 crore from ₹33,774.87 crore.

The bank continued to strengthen its balance sheet. Asset quality improved significantly with the Gross NPA ratio falling 66 basis points YoY to 2.26% in Q4FY25, down from 2.92% in Q4FY24. The Net NPA ratio also declined 10 basis points to 0.58% from 0.68%. On a sequential basis, GNPA and NNPA improved slightly from 2.43% and 0.59%, respectively, in Q3FY25. The capital adequacy ratio rose to 17.19%, up by 88 basis points YoY, reflecting strong capital buffers.

The Board of Directors, which met today, recommended a dividend of ₹8.35 per equity share on a face value of ₹2 each, fully paid-up, for the financial year 2024–25, subject to approval at the 29th Annual General Meeting scheduled for June 23.