AU Small Finance Bank held its Q3 FY26 earnings conference call on January 20, 2026. Key highlights included strong deposit and loan growth, margin expansion, and improving asset quality. The bank launched new products and expanded its distribution network. Management discussed their outlook, including targets for loan growth, cost-to-income ratio, and ROA. The transcript provides detailed insights into the bank’s performance and future strategies.
Financial Performance Highlights
AU Small Finance Bank reported robust performance for Q3 FY26, demonstrating strong growth and improved profitability:
- Deposits grew by 23% year-on-year, reaching ₹1,38,000 crores.
- Loan portfolio increased by 19.3% year-on-year.
- Margins expanded by 25 basis points quarter-on-quarter to 5.7%.
- PAT grew by 26% quarter-on-quarter.
- ROA expanded to 1.6% for Q3.
Business Segment Performance
The bank witnessed varied performance across its business segments:
- Secured assets grew by 23% year-on-year.
- Unsecured businesses showed signs of turnaround, growing by 1% in the quarter.
- Wheels business grew by 27% year-on-year, reaching ₹43,700 crores.
- Gold loan business grew strongly by 52% year-on-year.
Strategic Initiatives
AU Small Finance Bank continued to focus on strategic initiatives to drive growth and innovation:
- Launched an exclusive banking program for chartered accountants and “M Circle” for women customers.
- Expanded distribution by 100 physical touchpoints, including 27 new deposit branches.
- Increased foreign investment limit in the bank from 49% to 74%.
Outlook and Guidance
The management shared their outlook for the coming year:
- Targeting overall loan growth of around 20%-22%.
- Aiming for a cost-to-income ratio below 60%.
- Endeavoring to reach an ROA of 1.8% in FY27.
Source: BSE
