Bank of Baroda vs Union Bank of Q4 FY26

BA

Bank of Baroda

Q4 FY26 · Financial Services

Bank of Baroda reported a strong Q4 FY26 with net profit of ₹5,616 crore (up 11.2% YoY), the highest ever quarterly profit. Global business crossed ₹30.78 lakh crore, with advances growing 16.2% YoY driven by retail (17.9%), agriculture (20.7%), and MSME (15.6%). NIM improved to 2.89% (up 10 bps QoQ) aided by IT refunds, though management guided a conservative 2.75-2.95% for FY27 due to sticky deposit costs. Asset quality remained robust with GNPA at 1.89% and NNPA at 0.45%. The bank raised a ₹10,000 crore green infra bond and plans ₹14,500 crore capital raise (equity + AT1/Tier 2) over the medium term. Key risk: geopolitical headwinds could pressure liquidity and asset quality in the overseas book.

Guidance read

Loan growth guidance raised to 12-14% for FY27: Upsized from earlier 11-13% due to strong performance, subject to global headwinds. Deposit growth guidance raised to 10-12% for FY27: Upsized from 9-11% reflecting improved deposit mobilization. NIM guidance of 2.75-2.95% for FY27: Conservative range accounting for sticky deposit costs and volatile IT refunds. Capital raise plan of ₹14,500 crore (equity + AT1/Tier 2): Includes ₹8,500 crore equity by FY28 and ₹6,000 crore AT1/Tier 2 in FY27.

Risk read

Key risks include Sticky deposit costs pressuring NIM — Cost of deposits likely to remain elevated due to tight liquidity, limiting margin expansion.; Geopolitical impact on overseas book — Middle East exposure (~₹50-60k cr) and trade disruptions could stress asset quality, though currently benign.; ECL implementation uncertainty — Final guidelines may increase credit cost; management declined to quantify impact until full computation.; Aggressive auto loan growth risks — Long-tenor auto loans at competitive rates may face depreciation risk, though current stress is low..

Promise ledger

Scorecard data is being built as historical quarters are processed.

UN

Union Bank of

Q4 FY26 · Financial Services

Union Bank of India reported a strong Q4 FY26 with net profit of ₹18,697 crore and recommended a dividend of ₹5 per share. The bank achieved robust business growth, with gross advances up 9.74% YoY and a significant improvement in CASA ratio to 35.21% from 32.51% in September. Management highlighted a strategic shift from bulk deposits to retail term deposits and CASA, reducing bulk deposits by ₹70,000 crore. The bank also created a ₹700 crore contingency provision without impacting profit or capital. NIM compressed to 2.64% due to the December rate cut but management expects stabilization and gradual improvement. Credit cost was low at 23 bps for the year, with guidance of ~1% for FY27. Key risks include potential stress from West Asia disruptions and elevated SMA1 levels, though management sees no material impact yet. The bank targets 13-14% credit growth in FY27 while maintaining asset quality and profitability.

Guidance read

Credit growth target of 13-14% for FY27: Management expects to achieve 13-14% credit growth in FY27, in line with industry trends and better than the 9.74% YoY growth in FY26. NIM to stabilize and improve from 2.64%: Management expects NIM to defend current levels and gradually improve, driven by CASA expansion and better asset-liability management. Credit cost guidance of ~1% for FY27: Management guided credit cost around 1% for FY27, up from 23 bps in FY26, reflecting normalization and prudent provisioning. PSLC fee income to potentially reach ₹1,000 crore: Management indicated that PSLC fee income could return to ₹1,000 crore plus levels in FY27, similar to FY25, after a lower contribution in FY26.

Risk read

Key risks include West Asia geopolitical disruption impact — Ongoing West Asia conflict could stress energy-sensitive sectors and remittance flows, though management sees no material impact yet.; Elevated SMA1 levels — SMA1 loans nearly doubled sequentially, indicating potential stress in the near term, though management attributed it to migration from SMA2.; NIM compression from rate cuts — Further repo rate cuts could compress NIM, though management expects to defend margins through liability mix improvement.; Deposit growth lagging credit growth — Total deposit growth of 2.72% YoY trailed credit growth of 9.74%, potentially constraining future loan growth if not addressed..

Promise ledger

Scorecard data is being built as historical quarters are processed.