Bank of Baroda (BoB) on Saturday reported a surprise loss for the fourth quarter ended March 2021 as tax provisions climbed as the state-owned lender switched to a new tax structure.

During the quarter, BoB suffered a net loss of Rs 1,046.50 crore compared with a net profit of Rs 506.59 crore in the year-ago period after provisions for taxes rose to Rs 3,726.07.

The lender said in its notes to accounts that while recognising provision for income tax for the year ended March 2021, it exercised the option of a lower tax rate permitted under Section 115 BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment) Act, 2019.

The impact of these changes was a one-time charge of Rs 3,837.20 crore that was included in its tax expenses. Excluding the impact of the change in tax regime, it would have reported a net profit of Rs 2,267 crore during the period.

For the full year, the lender posted a net profit of Rs 829 crore, a jump of 52 per cent over Rs 546 crore in the preceding fiscal.

During the quarter, its asset quality improved with gross non-performing assets (NPAs) coming in lower at Rs 66,670.99 crore compared with Rs 69,381.43 crore in the year-ago period.

The percentage of gross NPAs came down to 8.87 per cent over Rs 9.40 per cent. For the year, its slippage ratio, or the accretion of fresh bad loans, declined to 2.71 per cent from 2.97 per cent in the previous fiscal.

The bank disclosed that it has restructured 7,861 accounts under the guidelines issued by the RBI in August last year. Because of this, the increase in provisions stood at Rs 11,335 crore.

During the quarter, the bank’s core income, or NII (net interest income), increased to Rs 7,107 crore from Rs 6,798 crore a year ago, a rise of 4.54 per cent.