AU Small Finance Bank Q1 Results: Net profit rises 16% at ₹581 crore, asset quality deteriorates | Company Business News

AU Small Finance Bank on Saturday announced its earnings report for the first quarter (Q1) ended June 30, 2025 of the fiscal year 2026.

The Jaipur-based bank said its net profit rose 16% at ₹581 crore during the first quarter of this financial year, as compared to ₹503 crore in the same period of the previous fiscal year.

Its total income stood at ₹5,189 crore during the June 2025 quarter, up from ₹4,278 crore in the same period a year ago.

Net interest income (NII) surged to ₹2,045 crore in the reported quarter against ₹1,921 crore a year ago.

Interest earned by the lender increased to ₹4,378 crore when compared with ₹3,769 crore in the June quarter of FY25.

AU Small Finance Bank’s operating profit jumped to ₹1,312 crore in Q1 of FY26 from ₹952 crore in the same period last fiscal year.

AU Small Finance Bank MD and CEO Sanjay Agarwal said: “We have reported another set of consistent performance in a seasonally soft quarter, showing sustainable growth in deposits, assets, and profitability”.

As the economic cycle strengthens, AU is well-positioned to navigate near-term uncertainties while staying committed to the long-term vision of building a forever bank that can truly scale with sustainability, he added.

Its asset quality deteriorated, as gross non-performing assets (NPAs) rose to 2.47% of gross advances at the end of the June quarter, from 1.78% a year ago.

Gross loan portfolio (GLP) rose 18% to ₹117,624 crore in Q1 FY25, as compared to ₹99,792 crore last year.

Similarly, net NPAs, or bad loans, increased to 0.88% against 0.63% in the year ago period.

As a result, provisions and contingencies almost doubled to ₹533 crore during the first quarter, when compared to ₹283 crore a year ago.

Provision Coverage Ratio (PCR) stood at 83 per cent at the end of June 2025.