MUMBAI: The third largest private sector lender Axis Bank has reported a steep 26% plunge in net profit to Rs 5,090 crore for the quarter to September spooked by higher provisions for bad loans and margin compression. It had reported Rs 6,918 crore net income in the year-ago period.
There are more negatives for the lender as its total income was muted at Rs 37,595 crore. Another red mark is the compressed margins with the net interest margin falling to 3.73% from 3.99% a year ago and 3.8% in the previous quarter. The bank saw its provisions and contingencies soaring 61% on-year to Rs 3,547 crore. This includes a one-time standard asset provision of ₹1,231 crore, pulling down the net profit.
The bank made additional provisions for bad loans despite gross NPA and net NPA levels improving to 1.46% and 0.44% respectively, as against 1.57% and 0.45% in June 2025, it said in a statement Wednesday.
Gross slippages during the quarter were Rs 5,696 crore, compared to Rs 8,200 crore in Q1FY26 and Rs 4,443 crore in Q2FY25. Recoveries and upgrades from NPAs during the quarter were Rs 2,887 crore. The bank wrote off NPAs aggregating Rs 3,265 crore, said the bank.
The net interest income rose 2% YoY to Rs 13,745 crore.
While the Mumbai-based lender's provisions and contingencies are up 61% year-on-year, they are down 10% from the June quarter, when the bank missed profit estimates as its provisions surged due to what the bank said was a one-time industry benchmarking exercise.
Specific loan loss provisions for the reporting period stood at Rs 2,133 crore. The bank holds cumulative provisions (standard + additional other than NPA) of Rs 13,262 crore at the end of Q2FY26, said the bank.
