Indian Overseas Bank has reported 76%
growth in net profit at Rs 1111.04 crore for the quarter ended June 2025
(Q1FY2026). The bank has posted healthy 13% growth in net interest income
(NII), while the core fee income of the bank also jumped 26% in Q1FY2026. The
Net Interest Margin (NIM) of the bank was steady at 3.04% in Q1FY2026 compared
to 3.06% in the corresponding quarter of previous year. On business front, the bank has posted 12% growth
in business with strong 14% surge in loan book. The asset quality of the bank has
improved in Q1FY2026. Bank has shown rise in the credit to deposit ratio to 79.3%
at end June 2025 from 77.0% at end June 2024. CASA ratio of the bank has improved
to 43.8% at end June 2025 from 42.2% at end June 2024.
Asset quality improves: The bank has exhibited healthy improvement in
the asset quality in Q1FY2026.
The fresh slippages of loans dipped to Rs 280 crore
in Q1FY2026 compared with 2753 crore in previous quarter and Rs 297 crore in
the corresponding quarter last year.
The recoveries of NPAs stood at Rs 180 crore,
upgradations at Rs 31 crore and the write-off of loans was at Rs 238 crore in
Q1FY2026.
Provision coverage ratio rose to 97.47% at end
June 2025 compared to 97.30% a quarter ago and 96.96% a year ago.
The capital adequacy ratio of the bank stood at 18.3%
with Tier I ratio at 15.8% at end June 2025.
The risk weighted assets of the bank has
increased 24% YoY to Rs 179152 crore end June 2025,
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Asset Quality Indicators: Indian Overseas Bank
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Jun-25
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Mar-25
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Dec-24
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Sep-24
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Jun-24
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Variation
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QoQ
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YoY
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Gross NPA (Rs Crore)
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5178.46
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5347.72
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6070.51
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6249.07
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6648.71
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-3
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-22
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Net NPA (Rs Crore)
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816.38
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911.86
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975.91
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1059.25
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1153.51
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-10
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-29
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% Gross NPA
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1.97
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2.14
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2.55
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2.72
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2.89
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-17
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-92
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% Net NPA
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0.32
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0.37
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0.42
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0.47
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0.51
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-5
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-19
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% PCR
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97.47
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97.30
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97.07
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97.06
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96.96
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17
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51
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% CRAR - Basel III
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18.28
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19.74
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16.97
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17.45
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17.82
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-146
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46
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% CRAR - Tier I - Basel III
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15.78
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17.13
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14.33
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14.75
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14.99
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-135
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79
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Variation in basis points for figures given in
percentages and in % for figures in Rs crore
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Business Highlights:
Healthy business growth: The business of the bank has increased 12% YoY
to Rs 593213 crore end June 2025, driven by 14% surge in advances to Rs 262421 crore.
Deposits rose 11% to Rs 330792 crore at end June 2025.
CASA deposits ratio improves: The CASA deposits of the bank increased 15% YoY
to Rs 144837 crore at end June 2025. The CASA ratio improved to 43.8% at end
June 2025 compared to 42.2% at end June 2024, while declined from 43.6% a
quarter ago. The term deposits have increased 8% to Rs 185955 crore end June
2025.
Strong retail loan growth: Advances growth was driven by retail loans
rising 39% YoY to Rs 70803 crore at end June 2025, while credit to agriculture
increased 26% to Rs 76548 crore and MSME 6% to Rs 45246 crore at end June 2025.
The corporate credit has declined 11% to Rs 51450 crore end June 2025. The
overseas credit rose 4% to Rs 18373 crore end June 2025.
Investment book of the bank increased 12% YoY to Rs 114388 crore
at end June 2025. The SLR book moved up 14% to Rs 83109 crore, while non SLR
book rose 8% to Rs 27067 crore at end June 2025. The AFS book jumped 76% to Rs 15415
crore, while HTM book rose 4% to Rs 90730 crore at end June 2025.
Stable margins over a year ago: The bank has shown 15 bps YoY jump in cost of
deposits to 5.10%, while yield on advances increased 17 bps YoY to 8.92% in
Q1FY2026. NIM has declined 2 bps YoY and dipped 54 bps qoq to 3.06% in
Q1FY2026.
Branch expansion: The bank has added 10 branches and reduced 36 ATMs
in Q1FY2026, taking overall tally to 3345 branches and 3461 ATM`s end June
2025.
Book value of the bank stood at Rs 15.8 per share at end June 2025, while the
adjusted book value (net of NNPA and 25% of restructured advances) was Rs 15.3 per
share at end June 2025.
Quarterly Performance
NII rises on stable NIM: Bank has recorded 13% increase in the interest
earned at Rs 7385.55 crore, while interest expenses increased 13% to Rs 4639.30
crore in Q1FY2026. NII improved 13% to Rs 2746.25 crore in the quarter ended
June 2025.
Healthy growth in the core fee income: Bank has posted strong 26% growth in core fee
income to Rs 398 crore, while the recoveries and other income jumped 86% to Rs 574
crore. However, the treasury income declined 7% to Rs 207 crore and there were
losses in the forex segment at Rs 26 crore. The overall non-interest income increased
43% to Rs 1480.92 crore in the quarter ended June 2025.
Expenses ratio improves sharply: The operating expenses of the bank increased 4% to
Rs 1869.22 crore, as other expenses moved up 4% to Rs 702.74 crore, while
employee expenses increased 4% to Rs 1166.48 crore in Q1FY2026. Cost to income
ratio improved to 44.2% in Q1FY2026 compared with 51.8% in Q1FY2025, helping
the Operating Profit to increase 41% to Rs 2357.95 crore.
Provisions and contingencies decline: The bank has shown 10% decline in provisions to
Rs 844.05 crore. The loan loss provisions rose 9% to Rs 178 crore, while other
provisions declined 14% to Rs 666 crore.
Effective tax rate jumped to 26.6% in Q1FY2026 from 14.3% in
Q1FY2025. Net Profit rose by 76% YoY to Rs 1111.04 crore during quarter ended
June 2025.
Financial Performance FY2025:
Bank has posted 26% increase in net profit to Rs
3334.71 crore in the year ended March 2025 (FY2025). The net interest income
increased 11% to Rs 10890.21 crore, while non-interest income declined 2% to Rs
5545.07 crore. Net total income rose 6% to Rs 16435.28 crore in FY2025. The
operating expenses declined 11% to Rs 7747.27 crore, while provision and
contingencies galloped 25% to Rs 4176.29 crore. Profit before tax increased 32%
to Rs 4511.72 crore in FY2025. The cost-to-income ratio improved to 47.1% in
FY2025 compared to 56.3% in FY2024. An effective tax rate rose to 26.1% in
FY2025 compared to 22.2% in FY2024. The net profit has increased 26% to Rs 3334.71
crore in FY2025.
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Indian Overseas Bank: Results
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Particulars
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2506 (3)
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2406 (3)
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Var %
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2503 (12)
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2403 (12)
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Var %
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Interest Earned
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7385.55
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6535.03
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13
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28131.01
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24049.73
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17
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Interest Expended
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4639.30
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4093.96
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13
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17240.80
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14220.32
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21
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Net Interest Income
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2746.25
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2441.07
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13
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10890.21
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9829.41
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11
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Other Income
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1480.92
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1032.97
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43
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5545.07
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5656.26
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-2
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Net Total Income
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4227.17
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3474.04
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22
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16435.28
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15485.67
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6
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Operating Expenses
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1869.22
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1798.18
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4
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7747.27
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8721.91
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-11
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Operating Profits
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2357.95
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1675.86
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41
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8688.01
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6763.76
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28
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Provisions & Contingencies
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844.05
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937.87
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-10
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4176.29
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3351.23
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25
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Profit Before Tax
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1513.90
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737.99
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105
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4511.72
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3412.53
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32
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EO
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0.00
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0.00
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-
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0.00
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0.00
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-
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PBT after EO
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1513.90
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737.99
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105
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4511.72
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3412.53
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32
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Provision for tax
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402.86
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105.18
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283
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1177.01
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756.92
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55
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PAT
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1111.04
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632.81
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76
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3334.71
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2655.61
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26
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EPS*(Rs)
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2.31
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1.34
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1.73
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1.40
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Equity
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19256.6
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18902.4
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19256.6
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18902.4
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Adj BV (Rs)
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15.26
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12.27
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14.32
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12.46
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* EPS and Adj BV are calculated on diluted equity as given
for each year. Face Value: Rs 10, Figures in Rs crore
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Source: Capitaline Corporate Database
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