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Analyst Meet / AGM - Analyst Meet

Targets advances growth 14%-16% for FY2015

Bank of India

03-Nov-2014, 06:48
Bank of India conducted an analyst meet on 03 November 2014 to discuss the financial performance of bank for the quarter ended September 2014 and the prospects of the bank. Vijayalakshmi R Iyer- CMD addressed the meet:
Highlights:

Bank has exhibited improved performance in Q2FY2015 over Q1FY2015.
Bank is not witnessing uptick in credit demand as yet, as corporate are still deleveraging. Bank has targeted the advances growth 14%-16% for FY2015.
Bank has been focusing on improving the capital efficiency, as a result the risk weighted assets of the bank increased 1% in H1FY2015 against 6% increase in advances.
Bank is in discussion with the Reserve Bank of India and Ministry of Finance over a proposal of monetization of assets to improve its capital adequacy ratio. Bank expects proceeds of Rs 3500-4000 crore from monetization of assets.
The contribution of overseas business to the profitability has shown increase in Q2FY2015.
Overseas NIM of the bank increased sharply to 1.32% in Q2FY2015 from 1.02% in Q2FY2015 mainly on account of lower cost of funds.
Bank is expecting further improvement in overseas NIM to 1.5% by end FY2015.
Strong domestic improvement in NIMs to 2.73% in Q2FY2015 from 2.45% in Q1FY2015 was supported by strong recoveries performance. Bank is expecting domestic NIM to improve to 2.75% by end FY2015.
On advances front, bank is focusing on expanding retail loan book where it has strong lending pipeline.
Bank proposes to post 20% fee income growth for FY2015. Bank is expecting strong pick in transaction banking fee income. Bank also plans to float a subsidiary for merchant banking activities.
Bank sold Rs 133 crore of assets to Asset Reconstruction Companies (ARCs) in Q2FY2015 for a valuation of Rs 106 crore.
Fresh slippages of advances remain elevated at Rs 2970 crore in Q2FY2015. Slippages from restructured advances mainly contributed to overall slippages to NPA. About 40 accounts from restructured advance book worth Rs 1495 crore slipped to NPA category in Q2FY2015.
Bank conducted fresh restructuring of advances worth Rs 1358 crore in Q2FY2015. The restructuring pipeline of the banks stands at Rs 1500-1600 crore for Q3FY2015.
Bank proposes to reduce GNPA to 3.00-3.15% and NNPA to 2.0-2.1% by end March 2015.
Bank proposes to add 300 branches and 1000 ATMs in rest of FY2015.
About 14000 of fresh staff is set join bank in H2FY2015. By end March 2015, about one-third of bank staff will be below 30-years of age.