Bank of Baroda Retains CARE AAA Rating with Stable Outlook | CareEdge Ratings Update

• Credit Ratings: CARE AAA (Stable) for Tier-II bonds; CARE A1+ for certificate of deposit.
• Government Support: Government of India holds 63.97% stake in BoB as of June 2025.
• Capital Adequacy: CAR at 17.19%, CET I at 13.78% – comfortably above RBI norms.
• Profitability: Net profit rose 10% in FY25 to ₹19,581 crore; RoTA steady at 1.17%.
• Asset Quality: GNPA reduced to 2.26%; NNPA improved to 0.58%.
• Liquidity Strength: Liquidity coverage ratio at 127.61%; excess SLR of ₹51,533 crore.

Why Bank of Baroda’s Ratings Remain Strong
CareEdge Ratings reaffirmed BoB’s credit profile based on:

• Systemic Importance: Third-largest public sector bank with 8,508 branches, 9,316 ATMs, and over 75,000 employees.
• Diversified Advances Portfolio: Retail, agriculture, and MSME loans form 47% of gross advances; international business contributes 17%.
• Government Backing: Regular capital infusion and policy support strengthen BoB’s stability.
• Improving Asset Quality: Decline in NPAs supported by better recoveries and lower slippages.
• Global Presence: Over 140 million customers worldwide, ensuring a wide depositor base.

• Net Interest Margin (NIM) Pressure: NIM fell to 2.73% in FY25 (from 2.96% in FY24) and further to 2.59% in Q1FY26.
• CASA Deposit Slowdown: Share of low-cost deposits dropped to 37.8% in FY25, raising the bank’s funding costs.
• Slippage Risk: Slippage ratio rose to 1.23% (annualised) in Q1FY26 due to one international account turning NPA.

CareEdge cautioned that ratings could be downgraded if:

• Government stake falls below 51%,
• NNPA exceeds 3%,
• RoTA slips below 0.5%, or
• Capital buffers fall below 2.5% above regulatory levels.

Financial Performance Snapshot (FY25 & Q1FY26)

• Deposits: ₹14.72 lakh crore (up 11% YoY).
• Advances: ₹12.1 lakh crore (up 12.8% YoY).
• Total Income: ₹1.38 lakh crore in FY25 (up 9% from FY24).
• Net Profit: ₹19,581 crore in FY25 (up from ₹17,789 crore).
• Q1FY26 Profit: ₹4,541 crore on total income of ₹35,766 crore.

About Bank of Baroda
Established in 1908 and nationalised in 1969, BOB is a PSB with substantial footprint in the domestic and international markets.The government announced the amalgamation of Vijaya Bank and Dena Bank with BOB, effective April 01, 2019. In terms of asset size and total business, BOB is one of the largest PSB in India. The bank has over 140 million customers across the globe through its network of 8,508 branches, 9,316 ATMs, and over 75,000 employees as on March 31, 2025.
About CareEdge
Established in 1993, CareEdge Ratings is one of the leading credit rating agencies in India. Registered under the Securities and Exchange Board of India, it has been acknowledged as an External Credit Assessment Institution by the Reserve Bank of India. With an equitable position in the Indian capital market, CareEdge Ratings provides a wide array of credit rating services that help corporates raise capital and enable investors to make informed decisions. With an established track record of rating companies over almost three decades, CareEdge Ratings follows a robust and transparent rating process that leverages its domain and analytical expertise, backed by the methodologies congruent with the international best practices. CareEdge Ratings has played a pivotal role in developing bank debt and capital market instruments, including commercial papers, corporate bonds and debentures, and structured credit. For more information: www.careratings.com
Conclusion: Outlook Remains Stable for Bank of Baroda
With CARE AAA ratings reaffirmed and a stable outlook, Bank of Baroda continues to stand out as a financially strong and systemically important public sector bank. Its government ownership, robust capital adequacy, and improving asset quality underpin the bank’s stability.

However, margin pressure, CASA deposit slowdown, and slippage risks remain key challenges to watch. For investors and stakeholders, the latest ratings confirm BoB’s reliable credit profile, while signaling areas that need close monitoring in FY26.