AU Small Finance Bank Reports Strong Q3 Growth in Deposits and Advances

AU Small Finance Bank Ltd has announced significant growth in key financial metrics for the quarter ending December 31, 2025. The bank’s provisional update indicates that total deposits surged by 23.3% year-on-year, reaching ₹1.38 lakh crore, compared to ₹1.12 lakh crore in the same period last year. This robust increase is attributed to strong customer engagement and growing confidence in the bank’s offerings.

In addition to deposit growth, the bank reported a 24% rise in gross advances, which climbed to ₹1.25 lakh crore from ₹1.01 lakh crore a year earlier. The total gross loan book, which includes the securitised and assigned loan portfolio, stands at ₹1.30 lakh crore, reflecting a 19.3% increase from ₹1.09 lakh crore a year prior. Although the securitised and assigned portfolio saw a decline to ₹4,690 crore, down from ₹7,932 crore, the overall performance remains strong.

Financial Performance Overview

The bank’s performance in the previous quarter (Q2 FY26) highlighted a slight decline in net profit for the first time in six quarters. Net profit fell by 1.8% to ₹561 crore, compared to ₹571 crore in the same quarter last year. This decrease is primarily attributed to increased provisioning costs but still exceeded analysts’ expectations, surpassing the ₹520 crore forecast from a CNBC-TV18 poll.

On a sequential basis, net profit dropped by 3.4%, while total income rose nearly 15% year-on-year to ₹5,224 crore. Provisions increased significantly, rising by 29% to ₹481 crore. For the first half of FY26, the bank reported a net profit increase of 6.3% to ₹1,142 crore.

The bank’s shares closed marginally lower at ₹999.40 on January 2, reflecting market responses to the quarterly update. As the bank prepares for the formal announcement of its financial results, the preliminary figures indicate a strong trajectory in growth, driven by increased customer deposits and advances.