Presentation to Analysts Performance Highlights ( H1 & Q2, 2009-10) by Dr Rupa Rege Nitsure Chief Economist October 28, 2009

Bank of Baroda: Key Strengths Bank of Baroda is a 101 years old State-owned Bank with modern and contemporary personality, offering banking products and services to industrial and commercial, retail and agricultural customers across the country. Overseas Business Operations extend across 25 countries through 76 Offices Modern & Contemporary Personality Uninterrupted Record in Profit-making and Dividend Payment Strong Domestic Presence through 3,029 branches Pioneer in many Customer-Centric Initiatives Provides Financial Services to over million customers globally First PSB to receive Corporate Governance Rating (CAGR-2) Relatively Strong Presence in Industrially Progressive States of India All Domestic Operations Covered under the CBS A well-accepted & recognised Brand in Indian banking industry

Domestic Branch Network Bank’s network of domestic branches as on 30th Sept. 2009 was 3,029. During H1, FY10, Bank opened 107 new branches & merged four existing branches. Almost 37.0% of the total branch network is located in rural areas. New branches are primarily opened in Metro, Urban & Semi-Urban areas from Southern States, Gujarat, UP & Uttaranchal and Northern States like Delhi & Chandigarh. Bank still has 74 pending applications with the RBI for opening of new branches during FY10. Regional Break-up of Domestic Branches as on 30 Sept, 2009 Metro Urban Semi-Urban Rural 656 567 691 1,115

Robust Technology Platform Bank achieved 100.0% CBS implementation in its domestic operations on 19th Sept’09. Additionally, 43 br. in 12 overseas territories & 25 br. in seven overseas subsidiaries covering 79.0% of total overseas business is also on the CBS. All CBS branches are enabled for inter bank remittances through RTGS and NEFT. Bank’s customers enjoy facilities like internet banking, phone banking, rapid funds2india – an online money transfer service, etc.  Bank has implemented Global Treasury Solution in UK, UAE, Baharain & Hong Kong. Bank has made operational Corporate Cash Mgmt Services in Mumbai. Back office functions have been centralised for the branches & two regional back offices at Baroda & Jaipur have commenced operations for centralised account opening & issuance of personal cheque-books. AML System has been implemented in India & 14 overseas territories. Bank has introduced HRNES System comprising a Centralised-Database of its employees, which enables speedy decision-making, promotions, selection, etc. through automated processes. Payment Messaging Solution has been implemented in 11 overseas territories & all B category branches in India. A module for School Fee Collection has also been implemented.

Concentration (%): Domestic Branch Network

Pattern of Shareholding: 30th Sept, 2009 As on 30th Sept, 2009 Share Capital Rs 365.53 crore No. of Shares 364.27 million Net worth Rs 12,703.10 crore B. V. per share Rs 348.70 Return on Equity (annualised): 20.78% 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.

Comparative Performance of BoB Stock: Jun-Sept’09 Particular 31-Mar’09 30-Sept’09 % Return Sensex 9,708.50 17,126.84 76.41% Nifty 3,020.95 5,083.95 68.29% Bankex 4,490.97 9,855.80 119.46% BoB 234.55 482.40 105.67%

Annualised Business Growth: Sept’05 to Sept’09

Half-yearly Profits: Sept’05 to Sept’09 Net Profit has grown at a CAGR of 33.5% between Sept’05 & Sept’09

Asset Quality: Sept’04 to Sept’09

Business Performance: Sept’09 over Sept’08 Particular (Rs crore) Sept’08 Sept’09 % Change Global Business 2,79,820 3,56,274 27.3 Domestic Business 2,21,612 2,70,249 22.0 Overseas Business 58,208 86,025 47.8 Global Deposits 1,61,069 2,07,355 28.7 Domestic Deposits 1,31,019 1,60,608 22.6 Overseas Deposits 30,050 46,746 55.6 Global CASA Deposits 50,938 62,705 23.1 Current 12,165 15,717 29.2 Savings 38,773 46,988 21.2 Share of Domestic CASA improved to 36.17% by end-Sept’09.

Business Performance: Sept’09 over Sept’08 Particular (Rs crore) Sept’08 Sept’09 % Change Global Advances (Net) 1,18,751 1,48,919 25.4 Domestic Advances (Net) 90,593 1,09,641 21.0 Overseas Advances (Net) 28,157 39,278 39.5 Out of Gross Domestic Credit, Retail Credit Of which: 17,745 21,403 20.6 Home Loans 7,588 9,353 23.3 SME Credit 12,684 16,666 31.4 Farm Credit 14,625 18,575 27.0 Credit to Weaker Sections 6,475 9,194 42.0

Key Financial Ratios : Apr-Sept, 2009-10 Return on Average Assets at 1.13% [0.83% at end-Sept, 2008] Earning per Share (annualised) at Rs 72.46 [Rs 42.06 at end-Sept, 2008] Book Value per Share at Rs 348.70 [Rs 282.88 at end-Sept, 2008] Return on Equity (ROE) at 20.78% [14.87% at end-Sept, 2008] Capital Adequacy Ratio at 14.67% with Tier I Capital at 8.86% Cost-Income Ratio declined from 50.12% to 47.54%(Y-o-Y). Gross NPA ratio declined from 1.62% to 1.30% (Y-o-Y). Net NPA ratio declined from 0.43% to 0.27%(Y-o-Y). NPA Coverage improved to 79.29% [73.94% last yr] on prudent provisioning.

Operating Profits: Sept’09 over Sept’08 28.7% NII grew by 18.40% (Y-o-Y) in H1, FY10 and by 22.5% (y-o-y) in Q2, FY10.

Net Profits: Sept’09 over Sept’08 72.2% The Operating profit grew by 31.3% to Rs 1,031.59 crore and Net Profit by 60.4% to Rs 634.18 crore in Q2, FY10.

Other Highlights: Apr-Sept, FY09 & FY10 Particular (In %) Apr-Sept’08 Apr-Sept’09 Global Cost of Deposits 5.59 5.29 Domestic Cost of Deposits 6.12 6.01 Overseas Cost of Deposits 3.38 2.61 Global Yield on Advances 9.37 8.72 Domestic Yield on Advances 10.73 10.16 Overseas Yield on Advances 5.00 4.61

Other Highlights: Apr-Sept, FY09 & FY10 Particular (In %) Apr-Sept’08 Apr-Sept’09 Global Yield on Investment 6.78 6.73 Domestic Yield on Investment 6.91 6.94 Overseas Yield on Investment 5.42 4.06 Global NIM 2.77 2.49 Domestic NIM 2.92 2.74 Overseas NIM 1.90 1.51 NIM indicates Net Interest Income as % of Avg. Interest Earning Assets.

Other Highlights: July-Sept, FY09 & FY10 Particular (In %) July-Sept’08 July-Sept’09 Global Cost of Deposits 5.65 5.15 Domestic Cost of Deposits 6.20 5.87 Overseas Cost of Deposits 3.34 2.49 Global Yield on Advances 9.67 8.71 Domestic Yield on Advances 11.13 10.23 Overseas Yield on Advances 5.08 4.48

Other Highlights: July-Sept, FY09 & FY10 Particular (In %) July-Sept’08 July-Sept’09 Global Yield on Investment 6.33 6.69 Domestic Yield on Investment 6.39 6.87 Overseas Yield on Investment 5.65 4.33 Global NIM 2.80 2.63 Domestic NIM 2.92 2.89 Overseas NIM 2.06 1.59 Sequentially, the NIM has improved from 2.37% in Q1, FY10 to 2.63% in Q2, FY10 in global operations & from 2.57% to 2.89% in domestic operations.

Non-Interest Income: Apr-Sept, FY09 & FY10 (Rs crore) Apr-Sept, 2008 Apr-Sept 2009 % Change Comm., Exchange, Brokerage & Incidental Charges 557.55 624.15 11.9 Profit on Exchange Transactions 149.31 180.55 20.9 Recovery from PWO 98.17 116.55 18.7 Trading Gains 183.43 377.12 105.6 Total Non-Interest Income 988.46 1298.37 31.4

Non-Interest Income: Jul-Sept, FY09 & FY10 (Rs crore) Jul-Sept, 2008 Jul-Sept, 2009 % Change Comm., Exchange, Brokerage & Incidental Charges 284.88 323.95 13.7 Profit on Exchange Transactions 55.08 84.23 52.9 Recovery from PWO 43.69 66.61 52.5 Trading Gains 92.27 120.54 30.6 Total Non-Interest Income 475.92 595.33 25.1

Provisions & Contingencies: Apr-Sept, FY09 & FY10 (Rs crore) Apr-Sept’08 Apr-Sept’09 Provision for NPA / Bad Debts Written-off 1.21 480.68 Prov. For Dep. on Investment 337.55 -420.87 Prov. For Std. Adv. 55.86 10.07 Other Provisions (including Prov. For staff welfare) 127.60 7.50 Tax Provisions 417.45 644.59 Total Provisions 939.67 721.97

Provisions & Contingencies: Jul-Sept, FY09 & FY10 (Rs crore) Jul-Sept’08 Jul- Sept09 Provision for NPA/ Bad debts written-off 22.70 172.16 Prov. For Dep. on Investment 118.94 -61.07 Prov. For Std. Adv. 39.32 1.49 Other Provisions (including Prov. For staff welfare) 0.95 3.75 Tax Provisions 208.43 281.08 Total Provisions 390.34 397.41

Treasury Highlights: Apr-Sept, 2009-10 Treasury Income increased by 67.6% from Rs 332.74 crore in H1, FY09 to Rs 557.67 crore in H1, FY10. As of Sept 30, 2009, the share of SLR Securities in Total Investment was 85.83%. The Bank had 77.79% of SLR Securities in HTM and 19.90% in AFS at end-Sept 2009. While the modified duration of AFS investments is 2.13 years; that of HTM securities is 4.08 years. Total size of Bank’s Domestic Investment Book as on 30th Sept 2009 stood at Rs 54,068 crore. Total size of Bank’s Overseas Investment Book as on 30th Sept 2009 stood at Rs 3,880 crore.

Overseas Business: Apr-Sept, 2009-10 In H1, FY10, the “Overseas Business” contributed 24.2% to the Bank’s Total Business, 23.1% to its Gross Profit and 36.6% to its Fee-based income. While the Cost-Income Ratio for Domestic Operations stood at 52.28% in H1, FY10, it was just 21.62% for Overseas Operations. While the Gross NPA (%) in Domestic Operations stood at 1.58% at end-Sept, 2009, that for Overseas Operations was just 0.50%. “Gross Profit to Avg. Working Funds” ratio for Overseas Operations was 1.63% in Q1, FY10 comparable to 1.78% for Domestic Operations. On the Overseas Investment Book of Rs 3,880 crore, the Bank held Provisions worth Rs 217.29 crore during H1, FY10.

Sectoral Break-up of Industrial Credit: H1, FY10

NPA Movement (Gross): H1, 2009-10 Particular Amount in Rs crore A. Opening Balance 1,842.93 B. Additions during Q1, FY10 764.17 C. Reduction during Q1, FY10 643.74 Of which, Recovery 184.48 Upgradation 195.83 PWO & WO 263.43 Exchange Difference 6.77 NPA as on 30th Sept, 2009 1,956.59 Recovery in PWO in Q1, FY10 116.55

Gross NPAs: Sectoral Break-up at end-Sept, 2009 Apr-Sept’08 Apr-Sept’09 Agriculture 2.40 2.90 Large & Medium Ind. 1.08 1.21 Retail 3.22 2.38 Housing 4.06 2.67 SME 2.82 1.69

Sectoral Deployment of Credit in H1, FY10 % share in Gross Domestic Credit Agriculture 16.7 Retail 19.2 SME 15.0 Wholesale 49.1 Total 100.0%

Economic Scenario While Indian economy is slowly reverting to the growth track, there are strains in the form of continuing contraction in exports & the worst drought since 1972. Positive factors: Marked improvement in industrial production in recent months, upturn in primary capital market activity, revival in debt/equity capital inflows and easy liquidity conditions. Concerns: Origination of inflation from supply shocks, sluggishness in bank credit growth & private consumption demand, a decline of min. 2% expected in agricultural production & the services sector growth still below trend. The RBI has kept the GDP projection for FY10 at 6.0% with an upward bias in the Mid-Term Policy Review unveiled on Oct 27, 2009. It has also raised its projection for inflation at end-Mar 2010 to 6.5% with an upward bias. Continuous upward pressure on rupee/USD due to strong capital inflows & weakening of the USD overseas – a major challenge for the RBI going forward. The RBI has lowered the target growth in M3 to 17% from 18% earlier; Aggregate deposit growth for the banking system is kept at 18% but adjusted non-food credit growth is revised downwards to 18% from 20% earlier.

Bank’s Guidance & Vision The Bank would continue with its thrust on growth with quality & try to grow at above industry average to steadily expand its market share. The Bank would protect the current soundness of its key financials like ROAA, ROE, EPS, BVPS, NPL Position etc., through its dedicated focus on CASA Mobilisation, Efficient Pricing of Retail Deposits & Loans, Steady Reduction in Bulk Business and Credit Origination & Monitoring. The Bank would try to grow its Fee-based Income in tandem with its Loan-Book growth. The Bank is building Strong Foundation for Future Growth by Recruiting the best possible talent in the country from the Premier Institutions Working on BPR project in consultation with Mckinsey & Co. so as to achieve the optimum use of technology and right skilling of the manpower to yield maximum customer satisfaction.

Thank you.