Q3 2026 AU Small Finance Bank Ltd Earnings Call Transcript
Key Points
- AU Small Finance Bank Ltd (NSE:AUBANK) reported a strong deposit growth of 23% year on year, significantly outpacing the system growth of 12.7%.
- The bank's loan portfolio grew by 19.3% year on year, which is 1.3 times the system growth and nearly 2.5 times the nominal GDP growth.
- Asset quality improved with slippages declining by 13% quarter on quarter and the Gross Non-Performing Assets (GNPA) ratio decreasing by 11 basis points to 2.3%.
- Profitability expanded with a 26% quarter on quarter increase in profit after tax and a return on assets (ROA) of 1.6% for Q3.
- The bank continues to innovate with new product offerings, such as exclusive banking programs for chartered accountants and tailored propositions for women customers.
- The deposit environment remains intensely competitive with tight liquidity conditions, which could pressure future growth.
- Unsecured businesses registered a year-on-year degrowth of 17%, although there was a slight turnaround with 1% growth in the quarter.
- The cost-to-income ratio remains relatively high at 57% year-to-date, indicating room for improvement in operational efficiency.
- The bank's unsecured digital lending portfolio, including credit cards and personal loans, declined by 27% year on year.
- There is a reliance on bulk non-callable deposits, which could pose risks if liquidity conditions tighten further.
Ladies and gentlemen, good day and welcome to AU Small Finance Bank Q3 FY26 earnings conference call.
As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing and then 0 on your touchstone phone.
Please note that this conference is being recorded.
I now hand the conference over to Mr. Prince Twari, head of investor relations.
Thank you and over to you, sir.
Thank you, Sagar, and good evening everyone and welcome to AU Small Finance Bank's earnings call for the third quarter of financial year 2025-2020206. We thank you all for joining the call this evening. On today's call from the management, we have our founder, MDN CEO Mr. Sanjayriwal, our executive Director and Deputy CEO, Mr. Uttam Thibrewal, our interim CFO Mr. Gurav Jan, our Chief Credit Officer
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