Chennai, January 14, 2026: Indian Overseas Bank delivered a strong performance in the December quarter, reporting its highest-ever quarterly net profit of ₹1,365 crore for Q3 FY26, marking a year-on-year growth of 56.18 percent. The sharp rise in profitability was driven by healthy growth in net interest income, sustained momentum in core lending segments, and a continued improvement in asset quality.
Profitability Remains Robust
The bank’s operating performance strengthened during the quarter, with operating profit rising 14.87 percent year-on-year to ₹2,603 crore. Net interest income increased 18.29 percent to ₹3,299 crore, supported by higher advances and stable margins.For the nine-month period ended December 2025, net profit stood at ₹3,703 crore, up 62.13 percent, while operating profit rose 21.27 percent to ₹7,361 crore.
Domestic net interest margin improved sequentially to 3.42 percent in Q3 FY26 from 3.35 percent in the September quarter. Return on assets climbed to 1.28 percent from 0.93 percent a year earlier, reflecting improved profitability and balance sheet efficiency. The cost-to-income ratio remained stable at 45.74 percent.
Business Growth Accelerates Across Segments
Indian Overseas Bank’s total business expanded by ₹1.01 lakh crore year-on-year to ₹6.44 lakh crore as of December 2025, registering a growth of 18.71 percent.Total deposits increased 14.5 percent to ₹3.49 lakh crore, with CASA deposits rising 7.8 percent to ₹1.43 lakh crore. The domestic CASA ratio stood at 41.29 percent, while the global CASA ratio was at 40.85 percent. Retail term deposits grew 16.3 percent to ₹1.75 lakh crore.
On the lending side, total advances rose 24.1 percent year-on-year to ₹2.95 lakh crore. Retail, agriculture, and MSME credit recorded strong growth of 43.04 percent, 34.51 percent, and 17.42 percent, respectively. The combined RAM portfolio expanded 33.1 percent on a year-on-year basis, underscoring the bank’s focus on granular and diversified credit growth.
Asset Quality Shows Continued Improvement
Asset quality metrics improved further during the quarter. Gross non-performing assets declined to 1.54 percent, down 101 basis points year-on-year, while net NPAs reduced to 0.24 percent, an improvement of 18 basis points.The slippage ratio remained low at 0.11 percent, and credit cost moderated to 0.44 percent. Provision coverage ratio improved to 97.49 percent, reflecting strong balance sheet resilience.
Recoveries continued to outpace slippages, with total recovery of ₹890 crore in Q3 FY26, including ₹635 crore from written-off accounts. For the nine-month period, recoveries stood at ₹2,616 crore compared with slippages of ₹845 crore.
Capital Position and Network Expansion
The bank’s capital adequacy ratio stood at 16.30 percent at the end of December 2025, with Tier I capital at 13.99 percent and Tier II at 2.30 percent.During the past year, Indian Overseas Bank added 116 branches, taking its domestic network to 3,438 branches, of which 58 percent are located in rural and semi-urban areas. The ATM and cash recycler network expanded to 3,622 units, while the number of business correspondents increased to 11,959. Total customer touchpoints reached 19,019 as of December 31, 2025.
About the Bank
Indian Overseas Bank is a public sector bank with a nationwide presence, offering a wide range of banking and financial services across retail, corporate, agriculture, and MSME segments. The bank is listed on Indian stock exchanges and continues to focus on sustainable growth, improved asset quality, and enhanced customer reach through an expanding physical and digital network.Source:
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