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Business & Stocks Economic Times Markets • Oct 24, 2026

AU Small Finance Bank Q2 Profit Jumps 53% to Rs 858 Crore: Asset Quality Improvements and Earnings Overview

💡 Key Takeaways

•AU Small Finance Bank reported a 53% YoY jump in Q2 net profit to Rs 858 crore.
•Gross NPA ratio improved by 42 bps YoY to 1.99%, reducing total provisions by 25% to Rs 359 crore.
•Annualized credit cost improved by 45 bps to 0.8% from 1.2% over the previous year.

NEW DELHI [NCRBuzz Wire] — **AU Small Finance Bank reported a 53% year-on-year surge in net profit to Rs 858 crore for the quarter ending September, driven by robust core operations and enhanced asset metrics.** The lender's financial performance highlighted broad-based improvements across asset quality, provisioning, and credit costs during the period.

### Asset Quality and Provisions

**The bank's gross non-performing assets ratio registered a contraction of 42 basis points year-on-year, settling at 1.99% at the end of September.** This improvement in asset quality directly lowered financial provisions by 25% to Rs 359 crore, compared to Rs 481 crore recorded in the corresponding period of the previous fiscal year. Concurrently, the net NPA ratio improved by 7 basis points, reaching 0.81%.

### Credit Costs and Financial Metrics

**Annualised credit costs experienced a sharp amelioration, improving by 45 basis points to 0.8% down from 1.2% over the previous year.** These fiscal metrics reflect tighter credit appraisal standards and enhanced recovery mechanisms implemented across the institution's retail and commercial lending portfolios.

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🏛️ Background Context

Small finance banks in India operate under specialized Reserve Bank of India guidelines aimed at fostering financial inclusion by providing basic banking services to unserved and underserved sections.

💡 Citizen & Commuter Quick Explainer (FAQ)

Q1: What is the net profit of AU Small Finance Bank for Q2?

The bank reported a net profit of Rs 858 crore, reflecting a 53% year-on-year increase.

Q2: How did the asset quality metrics perform in September?

The gross NPA ratio improved by 42 bps to 1.99%, and the net NPA ratio improved by 7 bps to 0.81%.

Q3: What was the trend in provisions and credit costs?

Total provisions declined by 25% to Rs 359 crore, and annualized credit costs improved by 45 bps to 0.8%.

Verified Wires: Economic Times Markets, Google News Business Original Wire Dispatch ↗

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