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Indian Bank reported a healthy Q1FY27 performance

ICICIdirect Research 13 Jul 2026 DISCLAIMER

News: Indian Bank reported a healthy Q1FY27 performance, with advances growing 13.9% YoY (2.6% QoQ) to ₹6.85 lakh crore, driven by continued traction in RAM segments (14.8% YoY; ~66% of domestic advances), particularly retail (18.7%) and MSME (17.0%), while corporate advances grew 11.5%. Deposits grew 13.5% YoY (2.0% QoQ) to ₹8.44 lakh crore, broadly matching credit growth, with CASA ratio improving to ~39.7%, aided by strong current account growth (26.3% YoY). NII increased 17.0% YoY (4.6% QoQ) to ₹7,435 crore, while domestic NIM expanded 6 bps QoQ to 3.41%, supported by a lower cost of deposits and improved yields on advances. Healthy fee income, controlled operating expenses and treasury recovery drove operating profit growth of 17.0% YoY, while the bank reported PAT of ₹3,273 crore (+10.0% YoY; +5.5% QoQ) despite creating ~₹1,000 crore of ECL-related provisions and maintaining contingency overlays of ~₹323 crore for geopolitical risks. Asset quality strengthened further, with GNPA/NNPA improving to 1.86%/0.15%, PCR at 98.22% and credit cost declining to 23 bps, reflecting lower slippages and sustained recoveries

View: Core operating performance remains robust, supported by healthy business growth, improving asset quality and strong capital buffers. While the liability environment has eased, sustaining funding discipline remains critical for protecting margins. Despite partial absorption of ECL-related provisions, earnings momentum remained steady, thus reflecting bank's strong balance sheet resilience

Impact: Positive

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