AU Small Finance Bank Q1 results: PAT up 16% at ₹581 cr despite higher NPAs

AU Small Finance Bank on Saturday posted a 16 per cent growth in net profit to Rs 581 crore during the first quarter of this financial year.

The Jaipur-based bank had earned a net profit of Rs 503 crore in the same quarter of the previous fiscal year.

The total income rose to Rs 5,189 crore during the June 2025 quarter from Rs 4,278 crore in the same period of FY25, AU Small Finance Bank said in a regulatory filing.

Interest earned by the bank improved to Rs 4,378 crore compared to Rs 3,769 crore in the June quarter of FY25.

Net interest income rose to Rs 2,045 crore during the quarter against Rs 1,921 crore a year ago.

The bank's operating profit also increased to Rs 1,312 crore from Rs 952 crore in the year-ago period.

However, the bank's asset quality witnessed deterioration, as gross non-performing assets (NPAs) rose to 2.47 per cent of gross advances at the end of the June quarter, from 1.78 per cent a year ago.

Gross loan portfolio (GLP) grew 18 per cent to Rs 1,17,624 crore compared to Rs 99,792 crore as of Q1 FY25, it said.

Similarly, net NPAs, or bad loans, increased to 0.88 per cent against 0.63 per cent in the year-ago period.

As a result, provisions and contingencies almost doubled to Rs 533 crore during the first quarter compared to Rs 283 crore a year ago.

Provision Coverage Ratio (PCR) stood at 83 per cent at the end of June 2025.

However, the capital adequacy ratio of the bank declined to 19.42 per cent from 20.11 per cent in the same quarter of FY25.

Commenting on quarterly numbers, 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.