SWOT Analysis of Bank of Baroda focuses on Strengths, weaknesses, opportunities, and threats. Strength and Weakness are the internal factors and Opportunities and Threats are the external factors that influence the SWOT Analysis of Bank of Baroda.
Bank of Baroda (BOB) is a public sector financial institution providing facilities such as personal banking, commercial banking, corporate banking, SME, etc. Bank of Baroda operates mainly in India. Baroda Bank has its registered office at Baroda, Gujarat. The government of India has merged Bank of Baroda, Vijaya Bank and Dena Bank in the year 2018. Bank of Baroda has 107 international branches in 27 Countries. Bank of Baroda was established by Sayaji Rao Gaekwad III in the year 1908.
Lets discuss the SWOT Analysis of Bank of Baroda.
Strengths in the SWOT Analysis of Bank of Baroda – Bank of Baroda SWOT Analysis
- Complete Banking Products Portfolio: Bank of Baroda has a wide range of banking services and financial instruments available for its customers.
- Wide Branch Network: Bank of Baroda, the second-largest bank in India, has a diversified branch network mix that sustains low-cost capital mobilization. Bank of Baroda has over 9482 branches throughout the country and has also reached rural India with over 1964 branches in rural India. Bank of Baroda has 13193 ATMs.
- Salary Account of Government Employees: Most of the government employees are having salary account in the Bank of Baroda.
- Strong Capital Position: Bank of Baroda held a strong capital adequacy ratio (CAR) of 13.45 percent as of 31 March 2019. Bank of Baroda has a business of 218 billion US Dollars.
- Large Customer Base: Bank of Baroda has a customer base of 131 million.
- Merger: Government has merged Bank of Baroda, Vijaya Bank, and Dena Bank. Bank of Baroda is now the third-largest lender in the country.
- Interest Rates: Interest rates are less as compared to private sector banks.
Weaknesses in the SWOT Analysis of Bank of Baroda – Bank of Baroda SWOT Analysis
- NPA: The NPA of Bank of Baroda is increasing year by year. In the year 2019, it was 15610 Crores and in the year 2020, it was 21577 Crore rupees. The bank is not able to decrease this NPA.
- Less Presence in International Markets: Bank of Baroda has business in 27 countries but the bank is primarily focused on its Indian market. BOB’s must increase their services in international markets to increase its profits.
- Forex Fraud: A number of employees have been caught in Forex Scam over the years. Even the RBI penalized the Bank of Baroda for a forex fraud of almost 6000 crores. Likewise, there have been other scams concerning bank employees.
- Less Brand Value: Government banks are known to advertise even less and only on the basis of the available budget. As a consequence, the bank has very poor brand value relative to private banks. In terms of the Government Banks, the Central Bank of India and other subsidiaries of the State Bank, as well as the Bank of India, has higher brand equity.
Opportunities in the SWOT Analysis of Bank of Baroda – Bank of Baroda SWOT Analysis
- Bancassurance: Most of the banks are promoting products offered by one or the other insurance companies. Bank of Baroda has entered into a joint venture with Andhra Banks and the UK-based firm and promoting products of IndiaFirst Life Insurance. This bancassurance model may have long-term results for the Bank of Baroda.
- UPI / Payment Bank: New banking products like UPI Payment Wallets are also a great opportunity for the bank. Bank can launch its UPI Payment app like Paytm or PhonePe.
- Development of Loan Market: Due to developing infrastructure Bank of Baroda can provide loans at less interest rates to potential customers.
- Business / Personal Loan: The business and personal loan segment can be a great opportunity for Bank of Baroda.
Threats in the SWOT Analysis of Bank of Baroda – Bank of Baroda SWOT Analysis
- High competition: There are many national and international players in Banking Industry. Due to intense competition business of Bank of Baroda is affected and this can be a major threat to the bank.
- Online Lending: Online Loans offered by various NBFC and Private Banks can be a major threat to the Personal Loan department of Bank of Baroda.
- Private banks: Private banks are a big rival to government banks because of the facilities offered and because of the strong functionality of private banks over government banks.
- Payment Wallets: Payment Wallets can also affect the business of Banks. This can be a major threat to Bank of Baroda and other government sector banks.
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