Axis Bank Ltd. delivered a strong start to FY27, reporting a 23% year-on-year increase in net profit to ₹7,114 crore for the quarter ended June 30, 2026, surpassing market expectations. The impressive performance was supported by healthy loan growth, stable asset quality, strong provisioning buffers and continued expansion across its retail, corporate and SME lending businesses, reinforcing the bank’s resilience amid an evolving macroeconomic environment.
The country’s third-largest private sector lender reported Net Interest Income (NII) of ₹14,646 crore, marking an 8% year-on-year growth, while maintaining a Net Interest Margin (NIM) of 3.46%. Despite higher provisioning during the quarter, the bank’s earnings remained robust, reflecting disciplined credit management and sustained business momentum across key segments.
Axis Bank made provisions and contingencies of ₹2,223 crore during the quarter, including specific loan loss provisions of ₹2,079 crore. The bank stated that it continues to maintain a strong provisioning framework, with cumulative provisions of ₹15,608 crore over and above regular NPA provisions. These additional buffers translate into a standard asset coverage ratio of 1.24%, while the bank’s overall Provision Coverage Ratio (including specific, standard and additional provisions) stood at an impressive 161% of Gross NPAs as of June 30, 2026.
The lender also retained its ₹2,001 crore precautionary provision created during the fourth quarter of FY26 to safeguard against potential risks arising from geopolitical tensions and macroeconomic uncertainties, particularly those linked to developments in West Asia. Axis Bank clarified that the provision remains purely precautionary and does not indicate any deterioration in asset quality or credit performance across its loan portfolio.
Asset quality continued to improve during the quarter, with the Gross Non-Performing Asset (GNPA) ratio declining to 1.28%, compared to 1.57% a year ago. Similarly, the Net NPA ratio improved to 0.39%, down from 0.45% in the corresponding quarter last year. The bank’s credit cost for the quarter remained contained at 0.63%, highlighting effective risk management despite a challenging economic backdrop.
During the reporting period, gross slippages stood at ₹5,566 crore, higher than the previous quarter but significantly lower than the same period last year. Recoveries and upgrades from NPAs amounted to ₹2,126 crore, while recoveries from written-off accounts reached ₹961 crore. The bank also wrote off NPAs worth ₹2,399 crore, maintaining its 70% provision coverage ratio against gross NPAs.
Axis Bank continued to witness healthy business expansion, with total advances growing 19% year-on-year to ₹12.62 lakh crore. The retail loan portfolio increased 8% to ₹6.76 lakh crore, accounting for 54% of the bank’s total advances. Within the retail segment, secured loans represented 73% of the portfolio, with home loans accounting for 26% of retail lending. Growth remained broad-based across several categories, including small business banking (18%), loan against property (11%), personal loans (7%), credit card advances (5%) and the rural loan portfolio (16%).
The bank also recorded strong momentum in its commercial lending businesses. The SME loan book expanded 25% year-on-year to ₹1.52 lakh crore, while the corporate loan portfolio surged 38% and the mid-corporate book grew 27%, reflecting increasing credit demand from businesses across sectors.
On the liabilities side, Axis Bank’s total balance sheet expanded 20% year-on-year to ₹19.22 lakh crore. Deposits grew 18% year-on-year, supported by healthy growth across all major categories. Current account deposits increased 6%, savings account deposits rose 14%, while term deposits recorded a robust 23% growth, strengthening the bank’s funding base and liquidity position.
The lender also reported continued improvement in its restructured loan portfolio. Outstanding loans restructured under the COVID-19 resolution framework declined to ₹913 crore, representing just 0.07% of gross customer assets. Axis Bank continues to maintain 17% provisions on these restructured loans, significantly above regulatory requirements, reflecting its conservative approach to risk management.
With stronger profitability, improving asset quality, sustained credit growth and a well-capitalised balance sheet, Axis Bank has entered FY27 on a solid footing. The results highlight the bank’s ability to balance business expansion with prudent risk management while maintaining adequate buffers against potential global economic uncertainties.
Disclaimer: This report has been editorially prepared using publicly available information and the company’s regulatory filing. Readers are advised to refer to Axis Bank’s official financial disclosures for complete details.
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