Bank of India (BoI) has reported robust growth in its Q1 FY26 business update, with domestic advances rising by 11% year-on-year to ₹5.64 lakh crore as of June 30, 2025. The state-owned lender’s growth was primarily driven by strong traction in the retail and agriculture segments, reflecting improved credit demand amidst a recovering economic backdrop.
Key Highlights Of Q1 FY26 Business Update
| Particulars | June 2024 (₹ lakh crore) | June 2025 (₹ lakh crore) | Growth (%) |
|---|---|---|---|
| Domestic Advances | 5.08 | 5.64 | 11.0 |
| Retail Advances | 1.12 | 1.31 | 17.0 |
| Agriculture Advances | 0.98 | 1.14 | 16.5 |
| MSME Advances | 0.92 | 1.00 | 8.7 |
| Corporate Advances | 2.06 | 2.19 | 6.3 |
| Global Advances | 5.22 | 5.80 | 11.1 |
| Domestic Deposits | 7.17 | 7.68 | 7.1 |
| Global Deposits | 7.30 | 7.85 | 7.5 |
Advances Growth Analysis
The 11% growth in domestic advances was supported by:
- Retail Lending:
Home loans, auto loans, and personal loans saw double-digit expansion driven by festive demand and stable interest rates. - Agriculture Lending:
The bank’s focus on priority sector lending, Kisan Credit Cards, and agri-infrastructure loans boosted its agri portfolio by 16.5%. - MSME Segment:
MSME credit demand remained steady, aided by ECLGS repayments and fresh working capital requirements. - Corporate Lending:
Corporate loan growth was moderate at 6.3%, reflecting cautious deployment amidst tight corporate bond spreads and selective project financing.
Deposits Performance
Bank of India’s domestic deposits grew by 7.1% to ₹7.68 lakh crore, driven by:
- Sustained CASA mobilisation in urban and semi-urban markets.
- Competitive retail term deposit offerings to maintain liability franchise stability.
| Deposit Mix | June 2025 (%) |
|---|---|
| CASA Ratio | 42.7 |
| Retail Term Deposits | 35.8 |
| Bulk Deposits | 21.5 |
The CASA (Current Account Savings Account) ratio remained stable, indicating a healthy low-cost deposit base critical for funding growth at optimal margins.
Credit-Deposit Ratio Trend
| Quarter | Credit-Deposit Ratio (%) |
|---|---|
| Q1 FY25 | 70.8 |
| Q4 FY25 | 73.5 |
| Q1 FY26 | 74.2 |
The rising credit-deposit ratio suggests efficient utilisation of deposits for credit growth, aligned with the bank’s strategy to boost net interest income.
Management Commentary
Bank of India stated in its exchange filing:
“The bank continues to maintain strong momentum in retail and agriculture lending while ensuring asset quality remains stable. We aim to grow our advances by 12-14% for FY26 with an emphasis on granular credit and risk-calibrated corporate lending.”
Analyst Perspectives
- Kunal Shah, ICICI Securities:
“Bank of India’s advance growth is healthy, particularly retail and agri segments. Focus on liability franchise and moderate corporate exposure will aid margins and asset quality.” - Mihir Parekh, Motilal Oswal Financial Services:
“With stable CASA and advancing towards double-digit loan growth, BoI is expected to deliver improved operating performance in upcoming quarters.”
Asset Quality Outlook
The bank has not provided gross NPA or net NPA updates in this business snapshot, which are typically disclosed in the detailed Q1 results scheduled later in July. Analysts expect a continued decline in NPAs, driven by recoveries and prudent underwriting.
Strategic Initiatives
Bank of India is undertaking:
- Digital Banking Acceleration:
- Expanding BoI Mobile and Internet Banking user base.
- Partnering fintechs for MSME credit analytics.
- Branch Rationalisation:
- Optimising urban branch presence while expanding rural outreach.
- Strengthening Capital Base:
- Evaluating fundraising through Tier-II bonds in H2 FY26 to support credit growth without diluting equity.
Sector Context
Public sector banks continue to post robust advances growth, supported by:
- Steady credit demand in housing, personal loans, and agriculture.
- Improved balance sheet strength post NPA clean-up cycle.
- Higher profitability enabling capital buffer creation for future expansion.
Peer Comparison: Q1 FY26 Advances Growth
| Bank | Advances Growth (%) |
|---|---|
| State Bank of India | 13.2 |
| Bank of Baroda | 11.8 |
| Punjab National Bank | 10.5 |
| Union Bank of India | 12.1 |
| Bank of India | 11.0 |
Bank of India’s growth remains in line with large PSU peers, with a healthy retail-agri tilt in its incremental advances composition.
Economic Implications
- Higher bank credit growth augurs well for GDP expansion, supporting consumption, housing, and MSME sectors.
- Reflects improved credit confidence amidst stable inflation and supportive monetary policy stance.
Outlook
Bank of India aims to:
- Maintain 12-14% advances growth for FY26.
- Improve net interest margin with a granular retail-agri portfolio mix.
- Reduce gross NPAs below 5% by FY26-end through aggressive recoveries.
Conclusion
Bank of India’s Q1 FY26 business update signals a strong start to the financial year, driven by solid domestic credit growth and deposit accretion. Its strategic focus on retail and agriculture lending, digital transformation, and asset quality stabilisation positions it favourably for sustained earnings momentum in FY26.
Disclaimer: This news report is for informational purposes only and does not constitute financial, investment, or banking advice. Readers are advised to consult certified financial analysts, official stock exchange filings, and Bank of India’s investor communications before making any business or investment decisions. The publication is not responsible for decisions taken based on the information presented.
