RBL Bank Q2 net profit jumps 170% to ₹482 crore on sharp bad loan drop

RBL Bank's net profit surged 170% year-on-year to ₹482 crore for the quarter ended September, driven by a sharp drop in bad loans and expanding core lending margins.

The private lender's net interest income rose 37% to ₹2,131 crore over the same period last year, while its net interest margin stood at 4.61%. Operating profit increased 92% to ₹1,396 crore, comfortably absorbing a modest 3% rise in annual operating expenses, which totalled ₹1,812 crore.

Significant improvement in asset quality

The quarter saw a marked strengthening in the bank's balance sheet health. Gross non-performing assets dropped by 131 basis points compared with a year earlier, settling at 1.02%.

Net non-performing assets fell by 28 basis points to 0.29%, reflecting disciplined recoveries and low slippages across retail and commercial books.

Capital adequacy remained elevated at 30.1% as of 30 September, slightly lower than the 33.3% recorded at the end of the previous quarter.

Credit expansion across sectors

Balance-sheet expansion kept pace with broader domestic credit growth. Net advances grew 42% year-on-year to ₹1.42 lakh crore, while total deposits expanded 34% to ₹1.56 lakh crore. The bank's current account and savings account ratio stood at 27.2%.

RBL Bank also mobilised $3.4 billion (₹32,472 crore) through the Reserve Bank of India’s concessional foreign currency non-resident swap facility by 31 August, bolstering its liquidity reserves.

Speaking to analysts after the results, Managing Director and Chief Executive Officer R. Subramaniakumar pointed to broad economic stability as a primary growth driver. "The Indian economy continues to demonstrate resilience, supported by robust domestic demand, healthy services activity, improving manufacturing momentum, and sustained investments," he said.

Wholesale banking focus

Subramaniakumar noted that banking asset quality across the national financial sector remains healthy, creating a favourable operating environment over the medium term.

To capitalise on this momentum, the lender plans to deploy its remaining surplus liquidity directly into corporate and wholesale banking. Management confirmed that this allocation is intended to expand the bank's capacity to underwrite larger exposures as industrial credit appetite picks up.