IndusInd Bank

IndusInd Bank reported a pre-provision operating profit of Rs.2,270 crores, marking an 11% QoQ growth. However, the profit after tax for the quarter stood at a lower Rs.128 crores, primarily due to high provisions of Rs.2,096 crores. Net Interest Income (NII) was Rs.4,562 crores, with the normalized Net Interest Margin (NIM) improving to 3.35% from 3.32% QoQ. Core fee income grew 2% QoQ to Rs.1,575 crores, contributing to an overall non-interest income growth of 3% QoQ to Rs.1,707 crores.

The bank continued its strategy of right-sizing the balance sheet by shedding inefficient assets and liabilities. Average deposits de-grew by 1% QoQ, driven entirely by a reduction in bulk deposits, while average retail deposits remained stable QoQ and grew modestly on a period-end basis. Consequently, the share of retail deposits increased to 47.5% from 47% QoQ. The cost of deposits improved by 14 bps QoQ to 6.09%, mainly due to term deposit repricing. Borrowings were also reduced by 13% QoQ, and the bank maintained a healthy average LCR of 122% with Rs.43,000 crores of surplus liquidity.

The bank's asset quality metrics showed a GNPA of 3.56% and an NNPA of 1.04%, with an overall Provision Coverage Ratio (PCR) maintained at 72%. Slippages, excluding micro loans, remained range-bound. However, slippages in micro loans remained elevated, though stringent underwriting norms implemented earlier in the year are beginning to show effect, with incremental stress formation reducing consistently. The 31-90 Days Past Due (DPD) book for micro loans improved to 2.4% from 3.2% in September 2025. Despite micro loan disbursements of Rs.3,598 crores, the micro loan book de-grew 17% QoQ to Rs.17,669 crores due to contractual rundowns of approximately Rs.6,300 crores.

The vehicle finance business experienced robust momentum, with disbursements increasing 26% QoQ to Rs.12,900 crores, leading to a 2% QoQ growth in the vehicle finance loan book to Rs.98,196 crores. The home loan book demonstrated strong growth, increasing 94% YoY and 10% QoQ to Rs.6,114 crores. Overall consumer banking assets grew 18% YoY to Rs.31,057 crores. Personal loans grew 12% YoY to Rs.10,598 crores, while the credit cards loan book de-grew 6% YoY due to rationalization of less efficient spends, though retail spends grew 5% QoQ.

The bank views the SME segment as a significant growth opportunity, with its current portfolio standing at Rs.43,957 crores. In wholesale banking, the loan book de-grew by 5% QoQ as the bank rationalized exposures that did not offer meaningful risk-adjusted returns. The wholesale banking portfolio maintains healthy asset quality, with 82% of customers rated A and above. Management is focused on continued granularization of the wholesale franchise and expanding growth frontiers.

IndusInd Bank is pursuing a 3-year strategy anchored around P.A.C.E. (Protect endowments, Accelerate key priorities, Customer centricity, Execution excellence). Key priorities include building a more granular, lower-cost deposit base, scaling SME and mid-market businesses, and improving stakeholder perceptions. The bank has significantly strengthened its leadership team with new hires for Head of Wholesale Banking, Chief Human Resources Officer, Chief Data Officer, CEO for BFIL, Head for SME business, and Head, Digital. Mr. Arijit Basu has also been appointed as the new Chairman.