Bank of Baroda Seeks to Raise ₹8,500 Crore via QIP

Bank of Baroda (BoB) has received board approval to raise up to ₹8,500 crore through various methods, including a Qualified Institutional Placement (QIP). The fundraising will take place in suitable phases until March 2028, subject to necessary regulatory approvals. 

The decision was made during the board meeting on February 13, 2025.

Extension of Debt Fundraising Timeline

Along with the equity capital raise, the board has also extended the deadline for raising an additional ₹4,000 crore through Additional Tier I (AT I) and Tier II debt capital instruments. This is part of the previously approved ₹7,500 crore capital plan in its meeting dated 05.07.2024.

The deadline for this has now been extended to March 31, 2026, and beyond if required.

Financial Performance

For the December 2024 quarter, Bank of Baroda reported a 5.6% increase in net profit at ₹4,837 crore, compared to ₹4,579 crore in the same quarter the previous year. The total income stood at ₹34,676 crore, up from ₹31,416 crore. Interest income rose slightly to ₹30,908 crore, compared to ₹28,605 crore in the year-ago period.

Despite the increase in net profit, the bank’s net interest income (NII) fell by 2% sequentially, mainly due to a drop in net interest margins (NIMs). The bank now expects NIMs for the current fiscal year to be between 3% and 3.10%, slightly lower than the earlier 3.10-3.20% estimate.

Share Price Movement

Following the board’s decision, Bank of Baroda’s shares closed at ₹210.78 on February 13, down 0.83% from the previous day. The stock has dropped by 13% this year and 18.80% over the last 12 months. In early trade on February 14, shares continued to decline, trading at ₹209.76, down 0.49% at 10:15 AM.

The bank’s credit-to-deposit ratio stands at 84%, close to its peak. However, with deposits expected to grow 9-11% and advances at 11-13%, the ratio is likely to settle at around 80%.

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