IDBI Bank reported on Saturday a 39% year-on-year decline in net profit, reaching 2,205 crore rupees in the second quarter of fiscal year 27. This figure contrasts with the 3,627 crore rupees recorded a year earlier. The reason for this drop is that the comparison base included a one-time income of 1,699 crore rupees received from the sale of investments in NSDL. Excluding this one-time income, net profit increased by 14% to 1,929 crore rupees. Compared to the first quarter of fiscal year 27, net profit grew by 4% to 2,115 crore rupees.
Non-interest income decreased by 46% year-on-year to 1,353 crore rupees compared to 2,489 crore rupees, which included income from NSDL. However, quarter-on-quarter, non-interest income showed an increase of 31%, rising from 1,032 crore rupees. Operating profit decreased by 18% year-on-year, falling to 2,893 crore rupees from 3,523 crore rupees in the second quarter of fiscal year 26. Without accounting for the one-time income, operating profit rose by 59%, reaching 1,824 crore rupees. Quarter-on-quarter, operating profit increased by 33% compared to 2,168 crore rupees in the first quarter of fiscal year 27.
Net Interest Income (NII) increased by 29% year-on-year, reaching 4,228 crore rupees in the second quarter of fiscal year 27, compared to 3,285 crore rupees a year earlier. Quarter-on-quarter, NII grew by 21% relative to 3,486 crore rupees in the previous quarter. Interest income increased by 20% year-on-year, amounting to 8,512 crore rupees versus 7,104 crore rupees, and also by 13% compared to 7,541 crore rupees in the first quarter of fiscal year 27. Net Interest Margin (NIM) improved to 4.11% in the second quarter of fiscal year 27 from 3.71% a year ago and 3.61% in the previous quarter. Deposit costs decreased by 14 basis points year-on-year to 4.55%, while fund costs decreased by 17 basis points to 4.65%.
The cost-to-income ratio was 48.17%, which is 385 basis points lower than the 52.02% in the first quarter of fiscal year 27, but higher than 38.99% a year ago when income was boosted by income from NSDL. Return on Assets (ROA) stood at 1.83% compared to 3.55% a year ago and 1.89% in the previous quarter. Excluding one-time income, the quarterly ROA a year ago was 1.89%.
Regarding asset quality, the Gross Non-Performing Assets (GNPA) ratio improved to 2.12% as of September 30, 2026, down from 2.30% in June 2026 and 2.65% a year ago. The Net NPA ratio was 0.17% compared to 0.16% in the previous quarter and 0.21% a year ago. The provisioning coverage ratio, including technical write-offs, reached 99.24% against 99.31% in June 2026 and 99.26% a year ago.
In terms of business, the total volume grew by 18% year-on-year to 6.27 trillion rupees and by 7% quarter-on-quarter. Total deposits increased by 17% to 3.56 trillion rupees, and net loans grew by 18% to 2.72 trillion rupees. The structure of corporate and retail loans accounted for 31:69 in total volume. CASA deposits grew by 12% year-on-year to 1.56 trillion rupees, but the CASA ratio decreased by 197 basis points to 43.82% from 45.79% a year ago. It improved by 18 basis points compared to 43.64% in June. The loan-to-deposit ratio was 76.34%, lower than 79.50% in the previous quarter and 75.88% a year ago.
The bank's capital adequacy ratio stood at 27.10% at the end of September 2026, compared to 25.39% a year ago and 26.92% in June. The Common Equity Tier-I ratio improved to 26.55% from 23.79% a year ago. Net capital increased by 18% to 61,164 crore rupees.