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

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.

Asset Quality & NPAs

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.