According to latest reports, Dhanlaxmi Bank registered 20% growth in net profit for Q3 FY26, reaching ₹24 crore compared to ₹20 crore in the corresponding period of the previous fiscal year. The bank's total income climbed 21% to ₹456 crore in Q3 FY26 from ₹377 crore in the same quarter of the previous fiscal, as per regulatory filings. Net Interest Income (NII) for Q3FY26 increased to ₹154 crore from ₹128 crore in Q3FY25, while interest income grew to ₹407 crore from ₹335 crore a year ago. Pre-provision operating profit soared 52% to ₹41 crore against ₹27 crore in Q3 FY25, demonstrating the Thrissur-based bank's sustained operational momentum. However, provisions and contingencies stood at ₹17 crore against ₹7 crore in the year-ago period, reflecting prudent provisioning practices.
For the first nine months of FY26, the bank recorded a net profit of ₹59.3 crore against ₹37.7 crore for the same period in the previous financial year, representing a 57.4% year-on-year growth. The operating profit for this period reached ₹102.61 crore compared to ₹56.42 crore in the corresponding nine-month period of FY25. Total income for the nine-month period increased to ₹1,281.5 crore from ₹1,095.4 crore a year earlier, reflecting sustained growth momentum across the bank's operations.
The bank demonstrated significant operational improvements with operating profit jumping 46% quarter-on-quarter, aided by controlled operating expenses and higher interest income. The operating margin improved substantially to 9.02% from 6.74% in the preceding quarter. However, provisions rose to ₹17.3 crore in Q3 from ₹5.0 crore in Q2, reflecting prudent provisioning practices. Earnings per share for the quarter improved to ₹0.61 compared with ₹0.59 in Q2, while the capital adequacy ratio stood at a healthy 17.19% under Basel III norms, significantly strengthened from 12.79% at the end of December 2024.
The bank's total business reached ₹31,929 crore as of December 31, 2025, up from ₹26,443 crore as of December 31, 2024, recording 21% growth. Total deposits increased to ₹17,839 crore from ₹15,068 crore, representing 18.39% growth. CASA deposits grew 9% to ₹5,018 crore as of December 31, 2025, from ₹4,602 crore in the previous year. Retail banking continued to be the largest contributor to revenue, while treasury operations supported profitability.
The bank's asset quality showed remarkable improvement with gross NPA declining to 2.36% from 3.53% a year ago, representing a 117 basis points improvement year-on-year. However, net NPA ratio rose to 1.11% from 0.86% at the end of December 2024, while the provision coverage ratio as of December 31, 2025, stood at 86.08%, indicating strengthened risk management and recovery efforts by the bank. This substantial improvement in asset quality reflects the bank's focused approach to credit management and collection efficiency.
Ajith Kumar K K, Managing Director and CEO, stated that "the bank sustained its positive momentum during the third quarter, recording steady growth across key business parameters alongside improved operational performance. The continued expansion in deposits and advances reflects the confidence and trust of our customers, as well as the successful execution of the bank's focused and disciplined growth strategy." With stable margins, improving asset quality, and adequate capital buffers, the bank's financial trajectory for FY26 remains firmly positive. Shares of Dhanlaxmi Bank closed 1.7% lower at ₹24.50 on BSE following the results announcement, as per Economic Times reports.
