Executive Summary
Axis Bank Ltd reported earnings for the quarter and nine months ended 31 December 2025, showing broad-based growth in deposits, advances, and core profitability, with net profit rising modestly year-on-year and improving significantly quarter-on-quarter. The results reflect sustained momentum in retail and corporate lending, healthy fee income, and disciplined asset quality metrics. Management emphasized digital transformation initiatives and depth in granular income streams while navigating margin compression and elevated investments in strategic platforms.
In a quarter marked by competitive funding costs and slowing interest rate adjustments, Axis Bank delivered a resilient profit performance supported by robust deposit accretion and continued focus on high-quality loan growth.
Financial Highlights
Axis Bank reported net interest income of ₹14,287 crore in the December quarter, up about 5% from a year earlier, supported by growth in loans and steady interest income.
The bank’s net interest margin was 3.64%, slightly lower than the previous quarter, as higher deposit costs weighed on margins despite stable asset yields.
Operating profit rose to ₹10,876 crore, an increase of around 3% year-on-year, helped by higher core income but partly offset by higher operating expenses.
Business Segment Breakdown
Axis Bank’s performance drivers in Q3 FY2026 included:
- Deposit Growth: Total deposits up ~15% YoY on MEB basis; current and savings (CASA) deposits showing robust inflows.
- Loan Book Expansion: Advances up ~14% YoY, with strong growth across retail, SME, and corporate segments.
- Fee and Non-Interest Income: Fee income up ~12% YoY, with retail fees forming a large share of total fees.
- Asset Quality: Gross NPA and Net NPA ratios improved modestly YoY and QoQ, reflecting stable credit performance.
- Capital & Liquidity: Adequate buffers with a CET-1 ratio near 14.50% and liquidity coverage comfortably above regulatory minimums.
While detailed per-segment profit contributions (e.g., corporate vs retail profitability) were not itemized in the release, broad loan and deposit metrics indicate contributions from diversified business lines.
Management Commentary
Amitabh Chaudhry, MD & CEO, highlighted the bank’s focus on “solutions that matter”, emphasizing digital transformation and customer-centric innovation. He noted sustained investments in future-ready platforms and inclusive banking initiatives that support long-term growth objectives.
Outlook & Risks
Forward Guidance:
Axis Bank reiterated its commitment to deepening digital engagement and expanding granular income streams, with a strong emphasis on sustaining deposit and loan growth while maintaining capital discipline. Detailed forward earnings guidance was not disclosed in the release.
Risks & Challenges:
- Margin Pressure: Slight compression in NIM points to competitive funding costs and slower asset yield transmission.
- Cost Efficiency: Operating cost growth remains an area to watch, given ongoing strategic investments.
- Macro/Regulatory: Broader economic conditions and RBI policy shifts could influence credit demand and pricing dynamics.
Key Takeaway
Axis Bank’s Q3 FY2026 earnings reflect stable profitability, robust balance sheet growth, and improving asset quality, underscoring a disciplined approach to expanding the franchise amid competitive pressures and evolving macroeconomic conditions.