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AU Small Finance Bank's Profit Soars 65% Amidst Universal Bank Push
27 Apr
Summary
- Net profit surged 65% year-on-year to ₹832 crore for the March quarter.
- AU Small Finance Bank applied for a universal bank license.
- Gross NPA ratio improved to 2.03% from 2.30% in the previous quarter.
AU Small Finance Bank announced a robust financial performance, with net profit for the January-March quarter of FY26 leaping 65% year-on-year to ₹832 crore. For the full fiscal year, annual profit increased by 25% to ₹2,641 crore. The bank has officially applied to the Reserve Bank of India for a final universal bank license, having received in-principle approval in 2025.
During the March quarter, net interest income grew 23% year-on-year to ₹2,582 crore, and net interest margin expanded to 5.96%. The bank's asset quality saw material improvement, with the gross NPA ratio decreasing to 2.03% and the net NPA ratio at 0.74%. The gross loan portfolio expanded by 21% to ₹1.40 lakh crore, while deposits rose 23% to ₹1.52 lakh crore.
Operational efficiencies were boosted by AI-led automation, reducing the cost-to-asset ratio. The bank also completed core banking migration and launched new digital platforms. The board has recommended a dividend of ₹1 per share for FY26, pending shareholder approval.
