AU Small Finance Bank has announced its financial results for the first quarter of FY26. The bank’s net profit grew by 16% to ₹581 crore, up from ₹503 crore in the same period last year.
Key Highlights:
- Total income rose to ₹5,189 crore, compared to ₹4,278 crore last year.
- Interest earned increased to ₹4,378 crore from ₹3,769 crore.
- Net interest income (income after interest expenses) grew to ₹2,045 crore from ₹1,921 crore.
- Operating profit went up to ₹1,312 crore from ₹952 crore in the previous year’s quarter.
Although profits increased, the bank’s asset quality weakened:
- Gross NPAs (bad loans before recoveries) rose to 2.47% of total loans, up from 1.78% last year.
- Net NPAs (bad loans after recoveries) increased to 0.88% from 0.63%.
- Provisions and contingencies (money set aside for bad loans) almost doubled to ₹533 crore from ₹283 crore.
Despite the rise in bad loans, the bank maintained a strong Provision Coverage Ratio (PCR) of 83%, meaning it has covered most of its bad loans with provisions.
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Loan Growth & Capital Position:
- The bank’s total loan book grew by 18% to ₹1.17 lakh crore from ₹99,792 crore.
- However, its capital adequacy ratio, which indicates financial strength, fell slightly to 19.42% from 20.11%.
CEO’s Statement:
Sanjay Agarwal, the MD and CEO of AU Small Finance Bank, said that the bank delivered consistent performance even during a seasonally slow quarter. He added that the bank continues to grow in terms of deposits, assets, and profits, and is well-prepared to handle any short-term challenges while staying focused on long-term goals.
Also See: HDFC Bank Q1: NII, Profit May Rise by 7% Despite Margin Pressure
