State-owned Indian Bank delivered robust financial results for the September quarter, with standalone net profit rising 15% year-on-year to ₹3,462 crore. According to reports from CNBC TV18 and Business Standard, this represents a significant improvement from the ₹3,018 crore profit recorded in the same quarter last year. The bank's quarterly performance demonstrates strong operational efficiency and growth momentum, with total income increasing substantially to ₹23,059 crore in Q2FY27 from ₹19,077 crore in the corresponding quarter last year. Interest income rose to ₹19,106 crore in Q2FY27 from ₹16,590 crore in the year-ago period, while operating profit increased to ₹7,090 crore against ₹4,837 crore in the same quarter a year ago. Net interest income (NII) grew 17.8% to ₹7,719 crore from ₹6,551 crore in Q2FY26, with other income increasing substantially to ₹3,953 crore which included ₹1,386.67 crore in income from the listing of National Stock Exchange (NSE) shares.
Share prices of Indian Bank and South Indian Bank witnessed sharp volatility following their Q2 earnings announcements, initially declining up to 4% to ₹818 and ₹47.70 respectively on the BSE in Thursday's intraday trade. However, both stocks demonstrated strong recovery momentum, with Indian Bank trading with a modest 0.2% gain at ₹850 at 2:05 PM, supported by over a two-fold jump in trading volume with 1.66 lakh shares traded on Thursday. South Indian Bank rallied to a high of ₹52.08, up 5% from the day's low, with trading volume reaching 28 lakh shares compared to the two-week average of around 8.80 lakh shares. Uco Bank traded on a steady note, down 0.2% at ₹23.90 amid a trading volume of around 6.90 lakh shares, as reported by Business Standard.
The bank's asset quality showed significant improvement during the quarter. Gross non-performing assets (NPAs) declined to 1.61% as of September 30, 2026, from 2.60% a year ago, representing a substantial improvement from the 1.86% in the previous quarter. Net NPAs eased to 0.14% from 0.16% in the year-ago period, while provisions for non-performing assets stood at ₹370 crore during the quarter, down from ₹382 crore in the July-September period of the last fiscal. The Provision Coverage Ratio (PCR) stood at 98.2% as on September 30, 2026, indicating strong provisioning against potential credit risks. However, provisions and contingencies, excluding tax, increased to ₹2,222 crore in Q2 FY27 from ₹1,196 crore in the preceding quarter and ₹739 crore a year ago.
While asset quality improved, the bank's capital position showed some pressure. The Capital to Risk-Weighted Assets Ratio (CRAR) declined to 16.21% from 17.31% at the end of the second quarter of the previous financial year. Separately, Indian Bank's board approved a comprehensive fundraising plan of up to ₹7,000 crore through non-equity instruments. As reported by CNBC TV18, this includes long-term infrastructure bonds worth up to ₹5,000 crore to finance or refinance infrastructure and affordable housing, and up to ₹2,000 crore through Basel III-compliant Additional Tier 1 (AT1) and Tier 2 bonds. The fundraising will be undertaken in one or more tranches during the current or subsequent financial years, depending on the bank's requirements, demonstrating the bank's proactive approach to strengthening its capital base for future growth initiatives.
