CSB Bank Reports 15.8% Rise in Q2 FY26 Net Profit to ₹160 Crore; Asset Quality Improves

CSB Bank Limited reported a robust financial performance for the second quarter of fiscal year 2026 (ending September 30, 2025). The bank's net profit saw a healthy 15.8% year-on-year jump, amounting to ₹160.3 crore, up from ₹138.4 crore in the same period last year. Asset quality metrics demonstrated sequential improvement; the gross non-performing assets (NPA) ratio slightly decreased to 1.81% from 1.84% in the previous quarter, while net NPA saw a more significant reduction to 0.52% from 0.66%.

Total deposits expanded by 25% year-on-year to ₹39,651 crore. The bank's current account savings account (CASA) ratio stood at 21%. Net advances grew by a strong 29% year-on-year to ₹34,262 crore, notably supported by a 37% increase in gold loans. Net interest income (NII) climbed 15% to ₹424 crore. Non-interest income also surged 75% year-on-year to ₹349 crore. The cost-to-income ratio improved, reflecting enhanced operational efficiency.

Operating profit increased by 39% year-on-year. The bank maintained a strong capital structure with a capital adequacy ratio of 20.99%, well above regulatory norms.

Impact: This news is significantly positive for CSB Bank and its investors, indicating strong operational efficiency, growth in core banking activities, and improving asset quality. It suggests the bank is effectively managing its risks while expanding its loan book and deposit base. The positive results could lead to increased investor confidence and potentially a positive stock price movement. Rating: 7/10

Difficult Terms: Gross Non-Performing Assets (NPA): Loans for which the principal or interest payment is overdue for 90 days or more. Gross NPA refers to the total value of such loans before any provisions are made. Net Non-Performing Assets (NPA): Gross NPAs minus the provisions made by the bank for these bad loans. Total Deposits: The total amount of money that customers have deposited in the bank. Net Advances: The total amount of loans given out by the bank after deducting any repayments. Gold Loans: Loans provided by a bank or financial institution where customers pledge gold ornaments or jewelry as collateral. Net Interest Income (NII): The difference between the interest income generated by a bank from its lending activities and the interest it pays out to depositors and other lenders. Non-interest Income: Income earned by a bank from sources other than interest, such as fees from services, commissions, and trading gains. Cost-to-Income Ratio: A measure of a bank's efficiency, calculated by dividing operating expenses by operating income. A lower ratio indicates better efficiency. Operating Profit: Profit from a company's core business operations before accounting for interest and taxes. Profit After Tax (PAT): The net profit remaining after all expenses, taxes, and interests have been deducted. Return on Assets (RoA): A profitability ratio that indicates how profitable a company is relative to its total assets. It is calculated by dividing net income by total assets. Net Interest Margin (NIM): A profitability ratio that measures the difference between the interest income generated by a bank and the interest it pays out, relative to its earning assets. It reflects how well a bank is managing its interest-earning assets and liabilities. Capital Adequacy Ratio (CAR): A measure of a bank's capital in relation to its risk-weighted assets, serving as a buffer against unexpected losses. It is mandated by regulators to ensure banks can absorb shocks.