Jana Small Finance Bank reported a 91.24% drop in third quarter net profit to ₹0.97 crore compared with ₹11.07 crore in the year-ago period, according to latest financial results. The sharp decline was attributed to higher provisions and increased operating expenses. The bank's gross non-performing assets ratio improved to 2.59% at the end of December from 2.80% a year back, indicating better asset quality management. For the nine-month period ended December 31, 2025, net profit declined substantially to ₹18.66 crore from ₹37.79 crore in the corresponding period of the previous year, despite strong revenue growth.
The bank set aside ₹27.68 crore as bad loan provisions for the third quarter, significantly higher than ₹17.38 crore earlier, leading to the substantial profit decline. Operating expenses increased to ₹63.30 crore from ₹49.09 crore in the previous year, primarily due to spending towards customer acquisition and stressed loan recovery. Employee costs specifically rose to ₹36.97 crore from ₹30.94 crore, reflecting increased staffing costs. The bank also recognized an estimated incremental impact of ₹11.89 crore under employee costs due to implementation of New Labour Codes notified by the Government of India in November 2025. Despite higher expenses, operating income rose to ₹162.89 crore from ₹135.48 crore year-on-year.
Total income grew 20.22% to ₹162.89 crore from ₹135.48 crore in the previous year, driven primarily by strong interest earnings. Interest earned reached ₹138.41 crore compared to ₹117.74 crore in Q3FY25, with interest on advances growing to ₹123.23 crore from ₹107.32 crore. Income on investments increased to ₹13.35 crore from ₹8.84 crore, while other income rose to ₹24.47 crore from ₹17.74 crore. However, retail banking segment reported negative results of ₹6.21 crore compared to positive ₹2.22 crore in Q3FY25, indicating challenges in this key segment. Treasury operations generated ₹3.64 crore in segment results, while corporate/wholesale banking contributed ₹0.57 crore.
Gross loan portfolio grew 19% year-on-year to ₹33,324 crore, with secured assets expanding 27% and unsecured loans growing 2%, as reported by The Economic Times. Managing Director Kanwal stated that loan disbursement has returned to normal levels, indicating recovery in the bank's lending operations. The bank maintained a robust capital position with capital adequacy ratio of 19.17% and debt-equity ratio of 0.87. Return on assets declined to 0.09% from 1.30% in the previous year, reflecting the challenging operating environment. During the quarter, the bank acquired loans worth ₹184.87 crore through assignment and transferred non-performing assets worth ₹369.85 crore to Asset Reconstruction Companies.
The bank has projected fourth quarter net profit at ₹140-160 crore with the help of lower credit costs, according to The Economic Times. Credit cost is expected to be ₹170-190 crore in the fourth quarter. The bank is also updating its application for the universal bank licence and will resubmit it at an appropriate time, after the Reserve Bank of India returned the application in October citing deficiencies. Basic earnings per share for the quarter stood at ₹0.92 compared to ₹10.57 in the corresponding quarter of the previous year. The bank has also scheduled an investor meeting with East Bridge Capital on February 9, 2026 in Bengaluru to discuss Q3FY26 results, with the meeting led by the Managing Director & CEO.
