HDFC Bank has announced its financial results for the third quarter of the fiscal year 2026. The bank reported a significant increase in net profit, showcasing robust performance despite rising costs.
Profit Growth and Key Figures
Net profit for HDFC Bank rose by 11.46% year-on-year to reach Rs 18,653.75 crore in Q3 FY26. This compares to Rs 16,735.50 crore in the same period last year. On a sequential basis, profit remained largely flat, with a marginal increase of 0.07% from the September quarter's Rs 18,641.28 crore.
Income and Margins
Total income surged impressively by 33.42% from a year earlier to Rs 90,005 crore. Net interest income stood at Rs 32,615 crore, marking a 6.4% year-on-year growth. Other income also saw a healthy rise of 15.72% to Rs 13,253.84 crore.
Net interest margin remained stable at 3.35%, slightly up from 3.27% in the previous quarter. This stability indicates effective management of lending and deposit rates.
Asset Quality and Balance Sheet
Asset quality showed strong improvement. Gross non-performing assets improved to 1.24% from 1.42% a year earlier. Net NPAs declined to 0.42% from 0.46%, reflecting better recovery and risk management.
The balance sheet crossed the Rs 40 lakh crore mark during the quarter. Total assets increased to Rs 40,88,987 crore, highlighting the bank's expanding scale.
Loan and Deposit Growth
Total advances grew by 12.04% year-on-year to Rs 28,21,446 crore. Deposits increased by 11.56% to Rs 28,60,055 crore. The CASA ratio stood at 33.6%, indicating a healthy mix of current and savings accounts.
The credit-to-deposit ratio remained elevated at about 98.6%. This reflects continued strong credit deployment relative to deposit growth, showing active lending activities.
Treasury and Other Income Drivers
Treasury profit rose sharply by 144% to Rs 2,227.60 crore from Rs 924.51 crore a year ago. This performance significantly boosted other income. Miscellaneous income, including recoveries from written-off accounts and banking charges, also contributed to the growth in non-interest income.
Costs and Provisions
Operating expenses climbed by 63% year-on-year to Rs 18,771.04 crore. This increase was driven by higher employee costs of Rs 7,203.17 crore and an estimated Rs 800 crore impact from the implementation of new labour codes.
Despite the rise in expenses, the cost-to-income ratio stood at about 20.8% based on total income. Provisions and contingencies declined by 10.02% from a year earlier to Rs 2,837.86 crore, indicating lower set-asides for potential losses.
Overall, HDFC Bank's Q3 results demonstrate solid growth in profit and key financial metrics. Strong loan growth, stable asset quality, and treasury gains supported earnings, even as operating costs saw a significant rise. The bank continues to maintain a robust position in the banking sector with its expanding balance sheet and efficient operations.
