IOB Q2 FY26 Results: Net Profit Increases 57.8% YoY to ₹1,226 Crore, Highest Ever Recorded

Chennai, October 16, 2025 – Indian Overseas Bank (NSE: IOB, BSE: 532388) logged its all-time highest quarterly net profit of ₹1,226 crore in Q2 FY26, a strong 57.8% year-on-year (YoY) increase over ₹777 crore in the previous corresponding period. The bank’s performance was supported by increased lending, better margins, and sustained emphasis on asset quality and operating efficiency.

Market Performance

As of 3:07 PM IST on October 16, IOB shares are trading at ₹39.76, down ₹0.47 or 1.17% for the day. The stock opened at ₹40.60, reached an intraday high of ₹41.05 and a low of ₹39.55. IOB has a market capitalization of ₹76,620 crore and a P/E ratio of 19.37, with a 52-week high of ₹59.94 and a 52-week low of ₹33.50.

Strong Financial Performance

In Q2 FY26, IOB’s operating profit increased 12.8% YoY to ₹2,400 crore and net interest income (NII) increased 20.5% YoY to ₹3,059 crore. Domestic net interest margin was higher by 14 basis points at 3.35%, and the global margin was higher at 3.21%. Cost-to-income ratio stood at 45.76%, demonstrating efficiency in operations, and the bank recorded a return on equity (ROE) of 19.95% and return on assets (ROA) of 1.20%.

Balance Sheet Strength

Total business increased 14.1% YoY to ₹6,17,034 crore, led by strong growth in deposits and advances. Total deposits rose to ₹3,39,066 crore, comprising CASA deposits of ₹1,37,387 crore and CASA ratio of 40.52%. Gross advances increased 20.8% YoY to ₹2,77,968 crore with credit-deposit ratio at 81.98%.

Asset Quality Improvement

The bank also improved asset quality with gross NPA coming down to 1.83% and net NPA to 0.28%. Provision coverage ratio rose to 97.48% and credit cost remained low at 0.18% with slippage ratio kept constant at 0.11%.

Capital Position and Recoveries

IOB’s Capital Adequacy Ratio (CRAR) was 17.94%, of which CET1 was 15.53% and Tier-II was 2.41%, demonstrating robust capital cushions. Total recoveries during the quarter were ₹874 crore, out of which ₹461 crore was from accounts written off.

Operational Highlights

IOB has 3,373 domestic branches consisting of 58% rural and semi-urban branches, and 3,567 ATMs/CRs. Total customer touchpoints numbered 18,407 as of September 2025, depicting IOB’s extensive reach across India.

Awards and Recognition

IOB won the Rajbhasha Kirti Award for outstanding Hindi implementation for the third straight year and ranked No.1 in the public sector bank Grievance Redressal Index during June–August 2025. The bank also won the SKOCH Platinum Award for innovation in the BFSI category for projects like the IOB SMART app and risk management.

Half-Yearly Performance (H1 FY26)

During H1 FY26, the bank’s net profit increased 65.7% YoY to ₹2,337 crore versus ₹1,410 crore in H1 FY25. Operating profit increased 25.1% to ₹4,758 crore, and NII increased 16.6% to ₹5,805 crore, which reflects good growth as well as continued operating efficiency.

Founded in 1937 and headquartered in Chennai, Indian Overseas Bank is one of India’s leading public sector banks that offers retail, corporate, and international banking services. Indian Overseas Bank is listed on NSE and BSE and continues to exhibit financial resilience on the strength of digital innovation, enhanced asset quality, and universal financial inclusion in the country.

REF: https://nsearchives.nseindia.com/corporate/IOB_16102025125751_PRESSRELAEAS.pdf

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