Will maintain global NIM at 3.20-3.25%, says Indian Overseas Bank
This story was originally published at 15:31 IST on 16 October 2025
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--Indian Overseas Bank: Domestic NIM at 3.35% as on Sept 30 vs 3.17% qtr ago
--Indian Overseas Bank: Global NIM at 3.21% as on Sept 30 vs 3.04% qtr ago
--CONTEXT: Indian Overseas Bk mgmt's comments in post-earnings concall
--Indian Overseas Bk: Gross NPA ratio as on Sept 30 at 1.83%, dn 14 bps QoQ
--Indian Overseas Bk: Jul-Sept total slippages at INR 2.9 bln, up 15% on yr
--Indian Overseas Bk: Jul-Sept total recovery at INR 8.74 bln, dn 41% on yr
--Indian Overseas Bank head on PSU bks' consolidation: Have no information
--Indian Overseas Bk: Sought govt OK to raise INR 40 bln equity capital FY26
By Srijita Bose and Sagar Sen
MUMBAI – Indian Overseas Bank expects to maintain its global net interest margin at 3.20-3.25%, management of the bank said in a post-earnings call with media on Thursday. The management statement came in response to a query over its guidance for the NIM for the second half of 2025-26 (Apr-Mar). At the end of September, the bank reported the global net interest margin at 3.21%, compared with 3.04% a quarter ago.
The net interest margin on its domestic businesses were up at 3.35% as of Sept. 30, against 3.17% a quarter ago. Indian Overseas Bank reported a nearly 58% on-year jump in its standalone profit for the quarter ended September on the back of an over 40% on-year drop in provisions. A rise in its interest earned also aided the healthy rise in the state-owned lender's net profit.
Part of the rise in net interest income of the bank was due to the rejig of its credit portfolios, the bank said. The bank reduced its portfolio linked to the Reserve Bank of India's repo rate to around 46%, from 60% earlier. On other hand, it increased its portfolio linked to the marginal cost of lending rate to around 49-50%, the bank said. This helped the bank gain some buffer time in repricing its loan book amid the easing cycle of the central bank.
The gross non-performing asset ratio of the bank was at 1.83% as of Sept. 30, from 1.97% a quarter earlier, and down from 2.72% a year ago. The bank's net NPA also reduced to 0.28% as of Sept. 30, from 0.32% a quarter ago and 0.47% at the end of the corresponding quarter the previous year. Total slippages of the bank was at INR 2.9 billion, up 15% on year. On the recovery front, the bank recovered INR 8.74 billion, down 41% on year.
The bank also said that it has sought the government's approval to raise INR 40 billion in equity capital in the current financial year ending Mar. 31, it said. The bank had earlier said it plans to raise INR 40 billion through a qualified institutional placement in Oct-Dec, subject to market conditions.
On consolidation of smaller state-owned banks to reform into fewer and stronger entities, Ajay Kumar Srivastava, the managing director and chief executive officer at Indian Overseas Bank, said they did not have any information about it.
Shares of Indian Overseas Bank fell slightly after it announced its earnings, and at 1452 IST, shares traded 1.1% lower at INR 39.82 on the National Stock Exchange. End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Akul Nishant Akhoury
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