Presentation to MediaPresentation to Media Performance HighlightsPerformance Highlights

( Q3 & Apr-Dec, 2008-09)( Q3 & Apr-Dec, 2008-09)byby

Dr Rupa Rege NitsureDr Rupa Rege NitsureChief EconomistChief EconomistJanuary 29, 2009January 29, 2009

Bank of Baroda: Key StrengthsBank of Baroda: Key Strengths BoB is a leading 100 years old PSB in India with modern and

contemporary personality, offering banking products and services to industrial and commercial, retail and agricultural customers across the country.

Steady Movement towards International best practices –

Preparing financials under US GAAP

Uninterrupted Record in Profit-making and

Dividend Payment

Overseas Business Operations extend across

25 countries through 74 branches/ Offices

First PSB to receiveCorporate Governance

Rating (CAGR-2)

Rapid & Significant Technology Progression

Since FY06

Pioneer in many Customer-Centric

Initiatives

Strong Domestic Presence through

2,899 branches

Modern & ContemporaryPersonality

Provides Financial Services to around

36.3 million customers globally

A well-accepted & recognised Brand in

Indian banking industry

Domestic Branch Network at End-Dec, Domestic Branch Network at End-Dec, 20082008

2708

2827

2899

2600

2650

2700

2750

2800

2850

2900

Dec'06 Dec'07 Dec'08

No. of Branches

Regional Break-up of Domestic Branches

Metro Urban Semi-Urban

Rural

631 528 645 1,095

•The Bank has a network of 2,899 domestic branches & it merged seven branches in Apr-Dec, FY09.

•About 60.0% of the domestic branches are in rural/semi-urban areas areas.

•Of the total no of 2,899 branches, 350 are Agriculture Thrust branches.

•Around 672 branches are located in minority concentrated districts.

• There are 126 specialised branches (including 19 service branches) & five Gen-Next branches as on date.

Robust Technology PlatformRobust Technology Platform

•By 31 Dec, 2008, the Bank has completed CBS Rollout in 1,923 domestic branches including 31 extension counters.

•All CBS branches are enabled for inter bank remittances through RTGS and NEFT.

•CBS has also been implemented in 66 overseas branches of Bank/its Subsidiaries.

•The Bank’s ATM network has increased to 1,175 from a mere 170 in 2005.

•The Bank has installed 48 ATMs at Railway Stations.

•Many novel products like RapidFunds2India, Baroda Connect, Online Tax Payment Facility, Depository Facility, Baroda Easy Pay, Online Payment of Railway Ticket Booking, etc. have been developed by the Bank to enhance customer convenience.

Concentration (%): Domestic Branch Concentration (%): Domestic Branch NetworkNetwork

Rest of India, 21.34

UP & Uttaranchal, 21.91

South, 10.56 Rajasthan, 11.99

Maharashtra, 11.18

Gujarat, 23.02

Pattern of Shareholding: 31Pattern of Shareholding: 31stst Dec, Dec, 20082008

Govt. of India53.8%Banks

0.3%Mutual Funds11.7%

Corp. Bodies1.8%

FIIs18.0%

Indian Public6.4%

Insurance Cos8.0%

Others0.1%

• BOB is a Part of the following Indexes

BSE 100, BSE 200 and BSE 500

Nifty Junior and Bankex.

• BOB’s Share is listed on BSE and NSE in ‘Future and Options’ segment also.

As on 31st Dec, 2008

• Share Capital Rs 365.53 crore

•No. of Shares 364.27 million

• Net worth Rs 11,011.17 crore

• B. V. per share Rs 302.28

•Return on Equity (annualised): 17.85%

Business Growth: Dec’04 to Dec’08Business Growth: Dec’04 to Dec’08

13.72

9.02

31.0321.91 23.17

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

Dec'04 Dec'05 Dec'06 Dec'07 Dec'08

Growth: Total Deposits (%)

18.56

33.78

46.82

22.99

33.17

0

10

20

30

40

50

Dec'04 Dec'05 Dec'06 Dec'07 Dec'08

Growth: Total Advances (%)

15.3017.31

37.06

22.3527.28

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

Dec'04 Dec'05 Dec'06 Dec'07 Dec'08

Growth: Total Business (%)

38.23

42 40.44

37.2836.1

32

34

36

38

40

42

Dec'04 Dec'05 Dec'06 Dec'07 Dec'08

Domestic CASA Share (%)

Profits: Apr-Dec’03 to Apr-Dec’08Profits: Apr-Dec’03 to Apr-Dec’08

3000.52

1789.361666.94

1428.43

1671.01

2214.10

1474.51

1159.08

780.80

618.20575.80

810.99

0.00

500.00

1000.00

1500.00

2000.00

2500.00

3000.00

3500.00

Dec'03 Dec'04 Dec'05 Dec'06 Dec'07 Dec'08

Rs crore

Gross Profit Net Profit

Bet.’ Dec’05 & Dec’08, Bank’s Gross Profit has grown at the CAGR of 28.1%.

Asset Quality: Dec’03 to Dec’08Asset Quality: Dec’03 to Dec’0811.42

8.31

5.74

3.022.11

1.50

3.46

2.11

1.100.67 0.54 0.37

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Dec'0

3

Dec'0

4

Dec'0

5

Dec'0

6

Dec'0

7

Dec'0

8

Gross NPAs (%)

Net NPAs (%)

Performance HighlightsPerformance Highlights

Bank’s Achievements against the Guidance for FY09

(1) Business Growth with a Thrust on Asset Quality

•Bank has expanded its loan-book at 33.2% (y-o-y) & yet managed to reduce its Gross NPA from Rs 2,040.30 crore at end-Dec’07 to Rs 1,981.38 crore at end-Mar’08 to Rs 1,921.42 crore at end-Dec’08 despite challenging economic conditions.

•Bank has added 6.3 million new customers to its books in Apr-Dec, FY09.

(2) Bank to exercise control over “Cost of Deposits” by focusing on CASA and by reducing dependence on Bulk Deposits

•Bank’s Domestic CASA share sequentially improved from 35.85% at end-Sept’08 to 36.10% at end-Dec’08 despite higher interest rates on term deposits available in the system.

Performance HighlightsPerformance Highlights

Bank’s Achievements against the Guidance for FY09

•Bank’s Core Deposits excluding Bulk Deposits increased at the pace of 17.9% in Apr-Dec, FY09 versus 12.3% in Apr-Dec, FY08.

(3) Focus on High-yielding Advances

•While Avg Yield on Domestic Advances & Global Advances stood at 10.53% & 9.58% respectively in Q3, FY08, it improved to 11.25% & 9.91% respectively in Q3, FY09.

(4) Thrust on Improving the NIM

•Bank’s Global NIM (% of interest-earning assets) improved to 3.30% & Domestic NIM to 3.61% in Q3, FY09 from 3.00% & 3.20% respectively in Q3, FY08.

(5) Special Emphasis on Fee-based Income

•Bank’s Core Fee-Based Income expanded at the pace of 25.8% (y-o-y) in Q3, FY09 despite volatile financial markets.

Thrust on Averages Rather Than Terminal Thrust on Averages Rather Than Terminal Nos.Nos.

Parameter

Apr-Dec’07(Rs Cr)

Apr-Dec’08(Rs cr)

Apr-Dec’07

(% Y-o-Y)

Apr-Dec’08

(% Y-o-Y)

Current Deposit

6,805 7,826 9.76% 15.00%

Savings Deposit

30,970 36,389 11.78% 17.50%

Time Deposit

63,807 82,418 28.54% 29.17%

Total Deposit

1,01,582 1,26,632 21.59% 24.66%

Advances 66,396 86,389 22.20% 30.11%

Business 1,67,978 2,13,022 21.83% 26.82%

•Figures pertain to domestic business based on weekly averages.

Business Performance: Dec’07 to Business Performance: Dec’07 to Dec’08Dec’08

•Global Business up 27.3%(Y-o-Y) to Rs 2,95,815.20 crore at end-Dec, 2008

•Domestic Business up 25.5%(Y-o-Y) to Rs 2,34,579.17 crore

•Overseas Business up 34.8%(Y-o-Y) to Rs 61,236.03 crore

•Global Deposits up 23.2%(Y-o-Y) to Rs 1,68,616.06 crore

•Domestic Deposits up 21.5%(Y-o-Y) to Rs 1,36,515.77 crore

•Overseas Deposits up 30.8%(Y-o-Y) to Rs 32,100.29 crore

•Domestic CASA share 36.10% at end-Dec’08

•Global Advances up 33.17% (Y-o-Y) to Rs 1,27,199.14 crore

•Domestic Advances up 31.4% to Rs 98,063.40 crore

•Overseas Advances up 39.4% to Rs 29,135.74 crore

Business Performance: Dec’07 to Business Performance: Dec’07 to Dec’08Dec’08

•Retail Credit up 22..1%(Y-o-Y) to Rs 18,804.62 crore at end-Dec 2008

•Retail Credit now forms 19.03% of Gross Domestic Credit

•Home Loan Book up 18.3%(Y-o-Y) to Rs 7,937.02 crore

•SME Credit up 27.8% (Y-o-Y) to Rs 13,710 crore

•Farm Credit up 25.8% (Y-o-Y) to Rs 15,620.56 crore

•Priority Sector Credit up 23.7%(Y-o-Y) to Rs 39,648.51 crore

•Bank’s credit to weaker sections was up 42.1% (Y-o-Y) to Rs 7,354.96 crore.

•Bank’s micro-credit to SHGs was up 45.0% (Y-o-Y) to Rs 549 crore.

Key Financial Ratios : Apr-Dec, 2008-Key Financial Ratios : Apr-Dec, 2008-0909 Return on Average Assets (ROAA) at 1.04% [0.89% at end-Mar,

2008]

Earning per Share (annualised) at Rs 53.97 [Rs 39.41 in FY08]

Book Value per Share at Rs 302.28 [Rs 261.54 in FY08]

Return on Equity (ROE) at 17.85% [15.07% in FY08]

Capital Adequacy Ratio( Basel II) at 13.20%

• Cost-Income Ratio declined from 49.45% to 46.00%(Y-o-Y).

Gross NPA ratio declined to 1.50% from 2.11% (Y-o-Y).

Net NPA ratio declined to 0.37% from 0.54%(Y-o-Y).

NPA Coverage improved to 75.40% on prudent provisioning

Operating Profits: Apr-Dec’08 & Q3, Operating Profits: Apr-Dec’08 & Q3, FY09FY09

2214.10

3000.52

0.00

500.00

1000.00

1500.00

2000.00

2500.00

3000.00

3500.00

Rs Crore

Apr-Dec'07 Apr-Dec'08

35.5%

932.40

1414.71

0.00

200.00

400.00

600.00

800.00

1000.00

1200.00

1400.00

1600.00

Rs Crore

Q3,FY08 Q3, FY09

51.7%

•NII grew at 26.7% (Y-o-Y) in Apr-Dec, FY09 & at 46.6% (Y-o-Y) in Q3, FY09.

Net Profits: Apr-Dec’08 & Q3, FY09Net Profits: Apr-Dec’08 & Q3, FY09

1159.08

1474.51

0.00

200.00

400.00

600.00

800.00

1000.00

1200.00

1400.00

1600.00

Rs Crore

Apr-Dec'07 Apr-Dec'08

27.2%

501.05

708.37

0.00

100.00

200.00

300.00

400.00

500.00

600.00

700.00

800.00

Rs Crore

Q3,FY08 Q3, FY09

41.4%

Other Highlights: Apr-Dec, FY09Other Highlights: Apr-Dec, FY09 Net Interest Margin (as % of interest-bearing assets) in Global

Operations stood at 2.94% in Apr-Dec, FY09 and 3.30% in Q3, FY09.

Cost of Deposits in Global Operations increased from 5.60% to 5.73%

Cost of Deposits in Domestic Operations increased from 5.77% to 6.25%

Cost of Deposits in Overseas Operations decreased from 4.84% to 3.52%

Yield on Advances in Global Operations declined from 9.61% to 9.58%

Yield on Advances in Domestic Operations improved from 10.51% to 11.25%

Yield on Advances in Overseas Operations declined sharply from 6.31% to 5.58%.

Yield on Investments in Global Operations improved from 6.91% to 7.18%. Yield on Investments in Domestic Operations improved

from 6.95% to 7.30% & in Overseas Operations declined from 6.53% to 5.88%

Other Highlights: Apr-Dec, FY09Other Highlights: Apr-Dec, FY09

Treasury Income (Profit on Sale of Investments) increased by 32.9% (Y-o-Y) to Rs 599.29 crore.

Fee-based Income (Commission, Exchange, Brokerage & Incidental Charges) improved by a strong 34.5% (Y-o-Y) to Rs 747.81 crore.

Cash Recovery (NPA & PWO) during Apr-Dec, FY09 stood at healthy Rs 633.21 crore despite visible signs of industrial slowdown.

Profit from Exchange Transactions grew by a robust 48.6% (Y-o-Y) to Rs 286.01 crore.

Overseas Business: Apr-Dec, FY09Overseas Business: Apr-Dec, FY09

In Apr-Dec, FY09, the “Overseas Business” contributed 20.70% to Total Business and 16.92% to Net Profit.

In Apr-Dec, FY09, the “Overseas Business” contributed 34.79% to the Bank’s income from commission/exchange/brokerage.

While the Cost-Income Ratio for Domestic Operations stood at 50.42% in Apr-Dec, FY09, it was just 20.35% for Overseas Operations.

While the Gross NPA (%) in Domestic Operations stood at 1.78% at end-Dec 2008, that for Overseas Operations was just 0.55%.

Whereas the “Gross Profit to Avg. Working Funds” ratio for Overseas Operations was 2.22% in Apr-Dec, FY09, it was 2.08% for Domestic Operations.

Banking ScenarioBanking Scenario

•Economic slowdown has deepened considerably with IIP growth slipping to 3.9% in Apr-Nov, 2008 from 9.20% in Apr-Nov, 2007

•The RBI has revised its GDP growth forecast downwards in Monetary Policy Review (Jan 27) to 7.0% (with a downward bias) from 7.5–8.0%

•Inflation, however, has eased considerably & expected in the band of 2.5% to 3.0% by end of FY09.

•Interest Rates have developed a south-ward bias, but adjustments of lending rates will be gradual as cost of funds still on the higher side and downside risks to growth remain significant

•Banks’ credit growth estimated at 24% & deposit growth at 19.0% for FY09.

•RBI’s steps since Oct, 2008 have released liquidity worth of Rs 3,66,000 crore so far in the banking system.

Bank’s Guidance for FY09Bank’s Guidance for FY09

•To continue with our thrust on “Growth with Quality” by focusing on CASA, by further reducing the dependence on Bulk Business & by protecting the Asset Quality with a firm control on the process of Credit Origination

•To achieve the Business Growth of 25.0% in FY09 and FY10.

•To protect the ROAA above 1.0% and ROE above 17.0% (already achieved in Apr-Dec, FY09) for FY09 & later

•To bring down the Cost-Income Ratio to 45.0%

•To maintain the growth of at least 25.0%-plus in core Fee-Based Income in FY09 and improve it further for the coming years

•To continue with our efforts to bring down Gross & Net NPA further despite challenging times ahead…

Thank you.