Bank of Baroda reported its highest ever quarterly standalone net profit of ₹6,532 crore for Q2 FY27, representing growth of 35.8% compared with ₹4,809 crore in the corresponding quarter last year.

The public sector lender announced its September quarter results on October 30, 2026. The earnings reflected stronger lending activity, improved asset quality and substantial income from the partial sale of its National Stock Exchange investment.

Bank of Baroda shares gained approximately 5% during trading on November 2, following the results announcement. Investors assessed the reported profit alongside the contribution from exceptional investment gains and the underlying banking business.

A major contributor was the bank’s partial monetisation of its National Stock Exchange holding. The transaction generated approximately ₹1,340 crore in gains, providing a substantial boost to quarterly profitability.

The bank disclosed that it sold 76.90 lakh NSE shares through the exchange’s initial public offering process, receiving gross consideration of approximately ₹1,372 crore.

Non interest income increased 95.8% year on year to ₹6,881 crore from ₹3,515 crore. The sharp expansion reflected treasury income, investment monetisation and stronger recoveries from previously written off accounts.

Treasury income reached approximately ₹4,093 crore compared with ₹1,086 crore a year earlier. However, such investment related gains may fluctuate considerably between reporting periods.

The core lending business also contributed to earnings growth. Net interest income increased 9% to ₹13,026 crore from ₹11,954 crore, supported by expansion in the bank’s loan portfolio.

Interest income rose 11.3% to ₹35,085 crore, while interest expenses increased 12.8% to ₹22,059 crore. The faster growth in funding costs continued to place pressure on lending profitability.

Global net interest margin stood at 2.74%, compared with 2.96% in the corresponding quarter last year and 2.77% in the preceding quarter. This indicates that margin pressure persisted despite stronger loan growth.

Managing Director and CEO Debadatta Chand indicated that the bank expects margins to improve during the second half of FY27. Management maintained its margin guidance range of 2.75% to 2.95%.

Operating income increased 28.7% to ₹19,907 crore, while operating expenses rose 7.4% to ₹8,477 crore. The difference supported a substantial improvement in operating profitability.

Operating profit reached a record ₹11,430 crore, representing growth of 50.9% from ₹7,576 crore a year earlier. Excluding the impact of NSE related gains, management indicated that operating profit remained approximately ₹7,749 crore.

Global advances expanded 18.3% year on year to ₹15.12 lakh crore. International advances grew 39.7% to ₹3.24 lakh crore, while domestic advances increased 13.5% to ₹11.87 lakh crore.

Corporate lending remained an important component of domestic credit expansion. Management also raised its FY27 credit growth guidance to 13% to 15%, reflecting expectations of continued demand across lending segments.

The bank revised its deposit growth guidance to 11% to 13% for FY27. Maintaining sufficient deposit mobilisation will be important as loan growth continues to increase funding requirements.

Asset quality improved during the quarter. The gross nonperforming asset ratio declined to 1.78% from approximately 2% in the June quarter and 2.16% in the corresponding quarter last year.

The net nonperforming asset ratio improved to 0.37% from approximately 0.50% in the preceding quarter. Fresh loan slippages declined to ₹2,392 crore from ₹3,183 crore in Q1 FY27.

Total provisions increased 93.3% year on year to ₹2,382 crore. The bank made approximately ₹1,300 crore of additional prudential provisions toward stressed and standard assets ahead of the proposed expected credit loss framework.

Management also created approximately ₹300 crore in contingency provisions to address potential volatility in debt and equity investments. These measures absorbed part of the benefit generated by investment income.

Despite the record September quarter, net profit for the first half of FY27 stood at ₹7,810 crore, below the corresponding previous year period. The comparison reflects the unusually weak June quarter, when standalone profit was ₹1,278 crore.

Bank of Baroda enters the second half with expanding advances, improving asset quality and stronger reported operating earnings. Future profitability will depend on sustainable interest income, deposit costs, credit quality and the extent to which recurring banking operations can compensate for the absence of unusually large investment gains.