Bank of India received a comprehensive credit rating reaffirmation from CARE Ratings Limited on December 18, 2025, covering its entire portfolio of Basel-III compliant Tier II Bonds and Infrastructure Bonds worth ₹50,000 crores. The rating agency maintained an 'A+' rating with stable outlook across all bond series, reflecting confidence in the bank's financial stability and government backing.

Comprehensive Rating Portfolio

CARE Ratings' evaluation encompassed multiple bond instruments with significant aggregate value:

The rating actions included reaffirmation of six existing bond series and fresh ratings for new Tier-II bond issues and Certificate of Deposit programs, demonstrating comprehensive coverage of the bank's debt instruments.

Strong Financial Performance Metrics

Bank of India's improved financial performance underpinned the rating reaffirmation. Key performance indicators show substantial growth:

The bank's asset quality parameters also showed improvement with Gross NPA ratio declining to 3.27% in FY25 from 4.98% in FY24, while Net NPA ratio decreased to 0.82% from 1.22%.

Government Support and Market Position

CARE Ratings emphasized the bank's strong government backing, with Government of India holding 73.38% shareholding as of September 2025. The rating agency expects continued support given Bank of India's significance as the sixth-largest nationalized bank with advances of ₹6.96 lakh crores and total business of ₹15.49 lakh crores.

The bank operates through an extensive network of 5,375 branches in India and 22 overseas branches, with 65% of domestic branches serving rural and semi-urban areas, providing strong franchise value.

Rating Outlook and Sensitivities

The stable outlook reflects CARE's expectation of continued stable financial performance with gradual improvement in asset quality parameters. However, the rating agency noted potential pressure on Net Interest Margin in FY26 due to faster repricing of advances compared to deposits.

Positive rating factors include improvement in profitability with Return on Total Assets remaining above 0.8% and sustained improvement in asset quality parameters. Negative factors could include decline in profitability below 0.30% ROTA or deterioration in capitalization levels.

Bank of India (BoI) has been penalized by the Reserve Bank of India (RBI) for irregularities observed at its Bhilai Currency Chest. The central bank imposed a fine of Rs 1,35,750 on BoI following an inspection that revealed certain discrepancies in the currency chest operations.

Penalty Details

Bank's Response

Bank of India has addressed the situation with the following actions:

1. Preventive Measures: The bank stated that it has implemented necessary preventive measures to avoid recurrence of such instances in the future.

2. Financial Impact: BoI has assured that the monetary penalty has no material impact on its financial operations or other activities.

Implications

While the penalty amount is relatively small for a bank of BoI's size, it underscores the importance of maintaining strict compliance with RBI regulations, particularly in sensitive areas such as currency chest operations. The incident serves as a reminder for all banks to ensure robust internal controls and adherence to regulatory guidelines.

Banks are expected to maintain the highest standards of operational integrity, especially in currency chests which play a crucial role in the distribution and management of currency notes. This penalty highlights the RBI's ongoing efforts to ensure the smooth functioning of the banking system and maintain public trust in financial institutions.

As Bank of India has already taken steps to address the issue, it is expected that the bank will strengthen its processes to prevent similar occurrences in the future, thereby maintaining its reputation and regulatory compliance.