IOB’s Q4 profit jumps 43% to Rs 1,505 crore

CHENNAI: Indian Overseas Bank (IOB) reported its highest-ever growth, with net profit rising 43 per cent year-on-year to Rs 1,505 crore in Q4FY26 and full-year profit surging 56 per cent to Rs 5,208 crore, driven by strong asset quality, lower provisioning and steady income streams, MD-CEO Ajay Srivastava said on Wednesday.

The bank also crossed a key milestone, with annual operating profit exceeding Rs 10,000 crore for the first time, at Rs 10,026 crore. “This has been one of our best years in terms of overall performance and consistency,” he told the media here.

Srivastava attributed the sharp profit growth to multiple factors. “Interest income has grown, but more importantly, slippages are low and asset quality is strong, which reduces provisioning. Fee income has also supported the bottom line,” he said.

IOB reported a treasury loss of Rs 555 crore in Q4 and about Rs 380 crore for FY26, but managed to offset the impact through core operations. “Whatever we lost in treasury, we have compensated from other areas,” he noted.

Net Interest Income (NII) rose 11 per cent to Rs 3,470 crore in Q4, while margins remained stable at 3.25 per cent. “We expect to maintain net interest margin (NIM) in the 3.2–3.3 per cent range,” he said. Domestic NIM stands at 3.35 pre cent while global NIM at 3.25 per cent in Q4FY26.

Business expanded 21 per cent to Rs 6.79 lakh crore, with advances up 24 per cent and deposits rising 18 per cent. The bank onboarded over 1.06 crore CASA customers in the last 10 quarters, generating Rs 1.8 lakh crore in incremental business. Asset quality remains among the best, with gross NPAs at 1.42 per cent and net NPAs at 0.21 per cent. Slippages were contained at Rs 366 crore, with the corporate book reporting zero fresh NPAs for around 10 quarters. Recoveries continued to outpace slippages.

On MSMEs, Srivastava said “there is some stress in MSMEs with Gulf linkages, but it is not alarming. We have created adequate cushion and are closely monitoring the situation,” while adding that the bank has built additional provisions of about Rs 1,750 crore.

IOB has given a guidance for 12 to 13 per cent credit growth and 14 to 15 per cent deposit growth in FY27. “Credit growth may be slightly subdued if geopolitical tensions persist,” he said. The bank plans to open around 225 branches, with licences already in place, while continuing to focus on balanced growth across retail, agriculture and MSME segments.