Bank of baroda

Interest Income
The following table sets forth the components of our interest income:
Year ended March, 31
2004
2005
(in Rs. million)
Interest and Discount on advances/bills
28,008.28
29,027.51
Income on Investment
29,321.76
29,889.77
Interest on balance with RBI and other Inter Bank Lending
1,973.69
2,354.65
Interest on Income Tax
1,110.04
1,889.81
Others
1,056.93
1,152.44
Total interest income
61,470.70
64,314.18
Interest and discount on advances and bills increased by 3.64% from Rs. 28,008.28 million in fiscal 2004 to Rs. 29,027.51
million in fiscal 2005, reflecting a 12.07% increase in average advances from Rs. 360,971.0 million in fiscal 2004 to Rs.
404,552.2 million in fiscal 2005. Our average advances in India increased by 10.68% from Rs. 297,043.3 million in fiscal
2004 to Rs. 328,756.5 million in fiscal 2005 and our average advances outside India increased by 18.56% from Rs.
63,927.7 million in fiscal 2004 to Rs. 75,795.7 million in fiscal 2005. The increase in average advances was partially
offset by reduction in average yield on advances from 7.76% in fiscal 2004 to 7.18% in fiscal 2005. The decrease in
average yield was due to a general reduction in market interest rates.
Income from investments increased marginally from Rs. 29,321.76 million in fiscal 2004 to Rs. 29,889.77 million in fiscal
2005. Our average volume of investments increased by 13.22% from Rs. 344,624.2 million in fiscal 2004 to Rs. 390,191.4
million in fiscal 2005. This increase was influenced by lower credit growth in the same period. Average yield on our
investments decreased from 8.51% in fiscal 2004 to 7.66% in fiscal 2005, reflecting a general reduction in market interest
rates.
Interest on balances with the RBI and other inter-bank lending increased from Rs. 1,973.69 million in fiscal 2004 to Rs.
2,354.65 million in fiscal 2005. This change was because of an increase in volume of inter-bank placements as well as
higher earnings on placements in the Rupee and forex markets.