Indian Overseas Bank Q3 profit jumps 56% on loan growth, asset quality

State-owned Indian Overseas Bank reported a 56% year-on-year surge in third quarter net profit at Rs 1365 crore as compared with Rs 874 crore in the year ago period, backed by a 24% expansion in advances and improvement in asset quality.

The bank’s operating profit stood 15% higher at Rs 2603 crore against Rs 2266 crore, helped by a 18% rise in net interest income at Rs 3299 crore and 16% rise in other income at Rs 1499 crore.

Its net interest margin for the quarter improved to 3.42% from 3.35% in the preceding quarter. NIM for the third quarter of FY25 was 3.47%

The bank created an additional provision buffer of Rs 1500 crore in the quarter under review in anticipation of the expected credit loss, which will become a norm from April 2027. This will be 60% of the total requirement for ECL provisions for the bank which is estimated at Rs 2500 crore.

Its asset quality improved with gross non-performing assets falling further to 1.55% at the end of December last year from 1.83% three months prior and 2.55% a year back.

The bank’s advances grew 24% year-on-year to Rs 2.95 lakh crore.