RBL Bank Q3 results: Net profit grows multi-fold to ₹214 cr; asset quality improves

RBL Bank on Saturday reported a sharp jump in profitability, with its standalone net profit surging 5.5 times to ₹214 crore for the quarter ended December 31, 2025 (Q3FY26), compared with ₹33 crore in the year-ago period. Ahead of the Q3 results, shares of RBL Bank ended Friday’s trade at ₹325.10, up 4.28%, with a market capitalisation of ₹20,063.76 crore.

The strong performance was driven by a steady core operating show and a significant improvement in asset quality, even as earnings were partly weighed down by a one-off employee-related expense. The private sector lender said profit for the quarter was impacted by a one-time pre-tax charge of ₹32 crore following a revision in the definition of wages under the new labour codes, effective November 21, 2025.

Operating profit, excluding the one-off income from the sale of a strategic equity investment in Q3FY25, rose 7% year-on-year and 25% quarter-on-quarter to ₹912 crore. Net interest income (NII) increased 5% YoY and 7% QoQ to ₹1,657 crore, while net interest margin (NIM) stood at 4.63%, the lender said in its earnings report.

The bank’s other income grew 13% both YoY and QoQ to ₹1,050 crore. Core fee income rose 10% YoY and 3% QoQ to ₹959 crore.

“Q3FY26 marks another quarter of stable and consistent operational performance for the bank. We continued to deliver strong growth in our focus areas, with secured retail advances and commercial banking driving asset side expansion while granular deposits supported on liability side,” said R Subramaniakumar, MD & CEO, RBL Bank.

He added that the bank’s core operating engine remains robust — anchored in disciplined execution, profitable balance sheet, and a sharper cross-sell to our existing customer base.

During the quarter, the bank received shareholder approval for capital infusion by Emirates NBD PJSC and for amalgamation of its Indian branches with RBL. The bank is awaiting regulatory approvals for the same.

Operating expenses for the quarter increased 8% YoY and 2% QoQ to ₹1,795 crore, while the cost-to-income ratio improved to 66.3% from 70.7% in the previous quarter, reflecting better operating efficiency.

On the liabilities side, deposit growth was driven by granular retail deposits. Total deposits rose 12% YoY and 3% QoQ to ₹1,19,721 crore. CASA deposits grew 6% YoY but declined 1% sequentially to ₹36,972 crore, with the CASA ratio at 30.9%. Granular deposits—balances below ₹3 crore—grew 15% YoY and 4% QoQ to ₹61,632 crore and accounted for 51.5% of total deposits. CASA and term deposits below ₹3 crore together formed 65% of overall deposits.

Advances continued to grow with a focus on secured retail assets and commercial banking. Net advances increased 14% YoY and 3% QoQ to ₹1,03,086 crore, with a retail-to-wholesale mix of 59:41. Secured retail advances surged 24% YoY to ₹34,407 crore, even as the bank reduced its IBPC outstanding to ₹1,500 crore from ₹4,500 crore. The overall retail loan book grew 10% YoY to ₹60,611 crore, while wholesale advances rose 21% YoY to ₹42,475 crore. Commercial banking outperformed, registering 30% YoY and 7% QoQ growth.

Asset quality improved during the quarter, with the gross NPA ratio declining to 1.88% as of December 31, 2025, from 2.32% in September 2025. The net NPA ratio also edged lower to 0.55% from 0.57%. The provision coverage ratio, including technical write-offs, stood at a healthy 93.2%.

The bank remained well capitalised, with a total capital adequacy ratio of 14.94% and a CET-1 ratio of 13.45% as of December 31, 2025, after including nine-month FY26 profits. Liquidity remained comfortable, with an average liquidity coverage ratio of 125% during the quarter.

RBL Bank said that it continued to expand its distribution footprint, with a total of 1,921 touchpoints as of December-end, including 580 branches and 1,341 business correspondent (BC) branches. Of the BC branches, 291 function as banking outlets, while subsidiary RBL Finserve accounted for 1,084 BC branches.