City Union Bank (CUB) has started the first quarter of the 2027 fiscal year (Q1FY27) on a high note. The private sector lender reported a net profit of ₹383 crore, which is a 25% increase compared to the same time last year. This growth was mainly driven by higher interest income and much better control over bad loans. The bank's CEO, Vijay Anandh, stated that they are well on track to reach a 20% overall business growth by the end of this financial year.

The bank’s Net Interest Income or NII (the difference between interest earned on loans and interest paid on deposits) grew by 31% to reach ₹820 crore. Another key metric, the Net Interest Margin or NIM (a measure of profitability), improved to 3.78%. This shows the bank is managing its costs well while earning more from its lending activities. Total advances, which refers to the total loans given out, rose by 25% to stand at ₹67,645 crore by June 30, 2026.

CUB primarily focuses on the RAM segment, which stands for Retail, Agriculture, and MSMEs (Micro, Small, and Medium Enterprises). Most of the bank's growth came from these sectors. On the other side of the balance sheet, total deposits grew by 21% to reach ₹79,342 crore. Interestingly, more than half of their bulk deposits now come from retail customers, showing that small savers trust the bank.

Asset quality has seen a major improvement, which is great news for bank officers. The Gross Non-Performing Assets or GNPA (total bad loans) dropped significantly to 1.73% from 2.99% a year ago. The Net NPA (bad loans after keeping aside provisions) fell to 0.61%. This marks the 12th quarter in a row where the bank has successfully reduced its bad loan levels, showing very disciplined recovery and credit monitoring.

CEO Vijay Anandh credited the government’s ECLGS (Emergency Credit Line Guarantee Scheme) for helping manage stress among businesses caused by global conflicts. The bank has already disbursed ₹200 crore under the latest version of this scheme. Looking ahead, the bank is very positive about the textile sector, especially the Tirupur cluster, as they expect new trade deals with the UK to boost business.

For customers and aspirants, it is worth noting that CUB is offering a high interest rate of 7.1% on FCNR-B deposits (Foreign Currency Non-Resident accounts). Even without branches overseas, they have raised ₹200 crore through these deposits. The bank is currently talking to other banks to get more support for this international funding. With strong profits and shrinking bad loans, CUB is positioning itself as a stable and growing player in the Indian private banking space.