Healthy net interest income growth, a sharp improvement in asset quality and the resultant drop in provisions coupled with a lower tax outgo buoyed the net income of the mid-sized private sector lender South Indian Bank in the June quarter to Rs378 crore, up 17.39% year-on-year.
The Thrissur-headquartered bank said on Thursday that its gross NPAs more than halved to 1.38% in the reporting quarter from 3.15% in the year-ago period, and so did the net NPAs, which plunged to 0.26% from 0.68% a year ago.
Net interest income rose 23.05% to Rs1,025 crore, while other income fell by 39.07% to Rs379 crore from `622 crore in June quarter of FY26. But this was offset to a large extent by a reduction in tax outgoes, which declined to `84 crore from `239 crore.
The net interest margin, which is the difference between what it earns in interest on loans and what it pay for funds, rose 20 bps to 3.23%.
The bank said its retail deposits grew 3.66% to Rs1,24,306 crore, of which NRI deposits grew by Rs4,139 crore or 12.8% to Rs36,432 crore and the low cost Casa grew 14.61%. Gross advances grew 17.% to Rs1,04,368 crore, of which corporate segment grew 12.38% to `41,704 crore, gold loans jumped 42.90% to Rs24,930 crore and home loans grew 78.65% to Rs5,856 crore and vehicle loans rose to 12.63% to Rs2,497 crore.
During the reporting period, the bank saw consistent growth across all targeted segments, focusing on quality asset acquisition in corporate lending, auto loans, and gold loans, said chief executive PR Seshadri said in the statement.
The strategy continues to centre around sustained profitability, superior asset quality, a resilient loan book, and a robust retail liability portfolio. “We are sharpening our organisational structure and leveraging digital technology to effectively achieve our business objectives”, he said.
During the quarter, the capital adequacy ratio rose to 19.62 from 19.48 at the end of the first quarter of FY26.