Debadatta Chand, MD&CEO, Bank of Baroda
It is very difficult to estimate the exact jump in tech spending above normal thresholds at this point in time, its managing director and chief executive Debadatta Chand told PTI, adding that the July incident involving a compromised employee email was a “huge wake-up call”.
Mumbai: State-run Bank of Baroda has scaled up its cybersecurity framework across technology, personnel, and operational processes following a July 2026 incident, with overall IT defence spending set to exceed 10 per cent of its operating profit, a senior official said.
It is very difficult to estimate the exact jump in tech spending above normal thresholds at this point in time, its managing director and chief executive Debadatta Chand told PTI, adding that the July incident involving a compromised employee email was a “huge wake-up call”.
Listing out the additional spends being incurred by the lender, Chand said, “Obviously, it (technology spend) will be going above 10 per cent of the operating profit”.
Tech spending, including capital investments and operating expenses, has been restricted to within 10 per cent of operating profit for many years and accordingly, the bank makes its annual budgets, Chand said.
Some of the spends will be incurred in FY27, while some may also go into the next fiscal year, he said.
The elevated spending includes efforts to improve the culture within the organisation, given that the last incident was due to a compromise at the people end, he said, adding that the bank has also updated software versions and processes.
An important aspect was to strengthen user access management by having multiple checks before someone can log on to a system, he said.
The bank engaged an external consultant to upgrade its processes, and has also been working closely with government agencies, including Cert-in, to have defences at par with the best in the world, he said.
Chand said the bank will be in a position to reveal the extent of higher spending after December this year.
“I think that incident gave us a huge… wake-up call, in terms of strengthening everything in terms of culture part and that we have done (that) now,” Chand said.
About the El Nino impact on its rural borrowers and their repayments, Chand said the Rs 840 crore of fresh slippages in the agri loans segment cannot be attributed to weather vagaries.
He added that the bank will be “watchful” of the El Nino impact on its books from the December quarter onwards.
“GNPA (Gross Non-Performing Assets) on all segments, including agriculture, has improved this quarter as compared to last quarter,” he said.
The bank’s life insurance subsidiary is a potential divestment candidate, but it will take at least one year’s business improvement before it can take a call based on the prevailing market conditions and valuations, he said.
For now, it will focus on recoveries from the written-off accounts done earlier to earn the provision write-backs, which can be ploughed in for increasing the buffer size in the run-up to the transition to the expected credit loss (ECL) system of provisioning, which sets in from April 1 next year, Chand said.