AU Small Finance Bank Limited has announced its financial results for the second quarter of FY27, reporting a 53% year-on-year increase in profit after tax, reaching ₹858 crore. Net Interest Income grew by 32% YoY. The bank also saw improvements in its Return on Assets (RoA) to 1.7% and Return on Equity (RoE) to 16.1%. Deposits grew by 29% YoY, and the loan portfolio expanded by 25% YoY, demonstrating robust growth across key financial metrics.
AU Small Finance Bank Reports Strong Q2 FY27 Performance
AU Small Finance Bank Limited has reported a significant increase in its financial performance for the second quarter of the financial year 2026-27 (Q2 FY27). The bank’s profit after tax surged by 53% year-on-year to ₹858 crore, compared to ₹561 crore in Q2 FY26. This robust growth underscores the bank’s strong operational efficiency and expanding market presence.
Key Financial Highlights
Net Interest Income (NII) saw a substantial increase of 32% year-on-year, driven by strong growth in the loan portfolio and an expansion in margins. The bank’s Return on Assets (RoA) improved to 1.7% for the quarter, up from 1.4% in the same period last year. Similarly, Return on Equity (RoE) rose to 16.1%, an increase from 12.4% in Q2 FY26. For the first half of FY27 (H1’FY27), profit after tax grew by 45% to ₹1,654 crore.
Deposit and Loan Growth
The bank experienced strong growth in its deposit base, with total deposits increasing by 29% year-on-year and 8% quarter-on-quarter. CASA deposits also showed healthy growth at 29% YoY and 11% QoQ, improving the CASA ratio to 29.5%. The loan portfolio expanded by 25% year-on-year and 7% quarter-on-quarter, with secured assets growing by 26% YoY and unsecured businesses by 23% YoY. Disbursements for the quarter were up 33% YoY.
Asset Quality and Operational Efficiency
Asset quality metrics remained stable, with the GNPA ratio declining by 42 basis points year-on-year to 1.99%. Credit cost, including guarantee premium, declined by 45 basis points YoY to 0.8%. The bank continues to focus on improving operating efficiency, with the cost-to-assets ratio, excluding guarantee premium, improving to 3.9%.
Strategic Initiatives and Outlook
AU Small Finance Bank continues to invest in its people, distribution, branding, and technology. The bank added approximately 2,400 employees and opened 45 new deposit branches and over 100 asset centers in Q2. Strategic technology investments in AI are aimed at enhancing customer service and operational efficiency. The outlook for the bank remains positive, with a focus on sustainable growth and long-term value creation.
Source: BSE
