Important StoriesSupreme Court rules YES Bank's AT1 bond write-off illegalSTT collection surges 52% in FY27 so far amid market volatility; net direct tax collection grows 13%India says first phase of US trade deal finalisedRailways, airports, data centres must build 100% redundancy in lines connecting to grid, says CEAIndia's exports up 23% to $44.4 billion in Sep; trade deficit narrows to $30.21 billionFollow UsFOLLOW US ON WHATSAPPHomeGO BACK TO HOME THIS AD SUPPORTS OUR JOURNALISM. SUBSCRIBE FOR MINIMAL ADS. THIS AD SUPPORTS OUR JOURNALISM. SUBSCRIBE FOR MINIMAL ADS. Indian Bank reports 15% rise in net profit, NII rises 18% Total deposits increased by 12.5% YoY and reached ₹8,74,036 Cr as of September 2026 By BL Chennai Bureau Updated - October 15, 2026 at 07:08 PM.×ShareWhatsAppXFacebookLinkedInMessengerRedditMailhttps://www.thehindubusinessline.com/money-and-banking/indian-bank-reports-15-rise-in-net-profit-nii-rises-18/article71588095.eceCopy Public sector lender Indian Bank reported a net profit growth of 14.7 per cent year-on-year (y-o-y) at ₹3,462 crore for the quarter ended September 2026 (Q2FY27). Profit growth was driven by a robust increase in net interest income along with a 14 per cent growth in total business.

Net interest income (NII) grew 18 per cent y-o-y to ₹7,719 crore.

Further, the bank’s non-interest income grew to an outlier of 58 per cent to ₹3,953 crore in the quarter, partially aided by income from the listing of National Stock Exchange (NSE) shares.

While this led to a 46 per cent growth in reported operating profit growth, the real growth in operating profit without the impact of NSE listing gains stood at 18 per cent.

“Credit growth came in at 16 per cent, much better than my earlier guidance,” Binod Kumar, MD and CEO, Indian Bank, said. All sectors of RAM - retail, agriculture, and MSME - have grown around 17 to 18 per cent.

Corporate credit also saw a robust growth of 9 per cent on the back of power and infrastructure-related lending, he added. Gross advances stood at ₹721982 Cr in September 2026 compared to ₹620324 crore as of September 2025.

Given the performance of Q1 and Q2, the bank is also upping its guidance marginally and now expects a credit growth of 13-14 per cent and deposit growth of around 11-12 per cent for FY27.

Total deposits increased by 12.5 per cent y-o-y and reached ₹874,036 crore as of September 2026. Indian Bank said it mobilised fresh FCNR(B) deposits amounting to ₹22,486 crore and also raised OFCB of ₹3,806 crore in this period.

“There was a lot of expectation that NIMs would see strain due to FCNR(B) mobilisaiton, but we have been able to manage NIM. In fact, gone up by one basis point,” Kumar said. In fact, we strategically reduced bulk deposit (including CD) by 5.6 per cent on a QoQ basis, from ₹1.62 lakh crore in June 2026 to ₹1.52 lakh crore in Sep 2026, he added.

Net Interest Margin (NIM) domestic stood at 3.42 per cent in Q2FY27 compared to 3.41 per cent in Q1FY27 and 3.23 per cent in Q2FY26. The bank did not disclose the deposit growth excluding FCNR(B).

Asset quality improved with Gross NPA decreasing by 99 bps y-o-y to 1.61 per cent in Q2FY27 and Net NPA reducing by 2 bps to 0.14 per cent in September 2026. However, provisions excluding tax increased to ₹2,222 crore in Q2FY27 from ₹739 crore in Q2FY26. Kumar explained that this included an Expected Credit Loss (ECL) provision of ₹1500 crore made in this quarter.

With regard to deposit mobilisation, Kumar acknowledged the pressures of raising deposits. “Our focus will be both on a small value deposit and a large value deposit. During the half year, we have added 250,000 salary accounts compared to 300,000 accounts added in the whole of the last fiscal year,” he said.

Separately, Indian Bank’s board approved a fundraising plan of up to ₹7,000 crore. This includes long-term infrastructure bonds worth up to ₹5,000 crore to finance or refinance infrastructure and affordable housing and up to ₹2,000 crore through Basel III-compliant Additional Tier 1 (AT1) and Tier 2 bonds.

The fundraising is planned to be undertaken in one or more tranches during the current or subsequent financial years, depending on requirements.

A business of ₹145,344 crore has been generated through digital channels in H1FY27, and the number of mobile banking users has grown by 26 per cent y-o-y, reaching 2.66 crore.

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