Bank of India Q3 Net Profit Rises 7% on Higher Non-Core Income

 State-owned Bank of India on Wednesday reported a 7% rise in December quarter net profit at ₹2,705 crore, helped by a rise in non-core income.

The bank's core net interest income rose 6% on-year to ₹6,461 crore in the reporting quarter on the back of a 14% growth in advances and the net interest margin compressing to 2.57% from 2.80%.

Its managing director and chief executive, Rajneesh Karnatak, said BoI is targeting to maintain loan growth at 13-14% in FY26, but conceded that the NIMs will be challenging as the entire impact of RBI's 1.25% rate cut plays out on its loan book.

He said the bank will aim to maintain the NIMs and will exit FY26 with a 2.60% NIM.

The non-interest income rose 30% to ₹2,279 crore during the quarter, helped by a 78% jump in profit from revaluation of investments at ₹473 crore.

Karnatak said with the geopolitical tensions, the bank will focus on growing the domestic advances and added that it has a pipeline of ₹80,000 crore of advances at various levels of sanction or disbursal.

This includes ₹65,000 crore of corporate advances, he said, adding that 60% of them are term loan proposals, which will be deployed for new investments.

The fresh slippages were stable on-year at ₹1,100 crore for the reporting quarter, the MD said, adding that they included a single exposure of ₹108 crore to the road sector.

The gross non-performing assets ratio improved to 2.26% from the quarter ago's 2.54%.

Provisions for bad and doubtful debt were stable at ₹205 crore for the quarter.

The overall deposit growth came at 11.64% and Karnatak said that the banking system is facing challenges to grow the book, given a structural shift to park savings in other assets perceived to be high-yielding, like mutual funds and equity markets.

The share of the low-cost current and savings account deposits declined to 37.97% as against 41.05% in the year ago period, and Karnatak rued that People are only maintaining an optimum level of balance with banks as they chase alternative avenues.

The overall capital adequacy for the bank stood at 17.09% as of December 31, 2025, and the lender is not looking for any equity fund raise now.

Karnatak said the bank will suffer a 2 percentage point hit on its capital buffers over five years on the implementation of the expected credit loss provisioning system.

It is estimated that the transition to the new system will lead to ₹9,200 crore in provisions, he said.

The Bank of India scrip closed 1.32% down at ₹157.55 apiece on the BSE on Wednesday, as against a 0.33% correction on the benchmark.