Strong growth, improved asset quality reflect solid fundamentals: MD & CEO
Jammu Tawi, Jan 20: J&K Bank today announced healthy financial results for the October–December quarter (Q3 FY 2025–26), reporting an 18.7% quarter-on-quarter rise and a 10.4% year-on-year (YoY) increase in net profit to Rs 586.73 crore, compared to Rs 531.51 crore in the corresponding quarter last year. The Bank’s Board of Directors approved the results for the quarter and the nine-month period at a meeting held at its Divisional Office in Jammu.
For the first nine months of the current financial year, net profit rose 4.5% YoY to Rs 1,565.68 crore from Rs 1,497.92 crore, reflecting sustained growth momentum.
Operating Performance
The Bank’s Net Interest Margin (NIM) improved to 3.62%, up by 6 basis points quarter-on-quarter. The cost-to-income ratio declined to 55.88% from 57.28% a year earlier, while return on assets (RoA) for the nine-month period stood at 1.23%.
Net Interest Income (NII) grew 3.8% QoQ to Rs 1,488.88 crore. Other income for the quarter surged 15.3% YoY to Rs 279.46 crore, compared to Rs 242.32 crore last year. The cost of deposits also eased to 4.69% from 4.86% QoQ.
Commenting on the performance, MD & CEO Amitava Chatterjee said that despite rate cuts, impairment provisioning for the Grameen Bank, and challenging conditions including the events of April 22 and subsequent floods, the Bank remains on track to deliver record profits for the fourth consecutive year. He added that the Q3 results underline strong fundamentals, disciplined execution, and sustained operational efficiency.
Asset Quality
Asset quality continued to improve, with the Gross NPA ratio declining to 3.00% from 4.08% YoY, a reduction of 108 basis points. Net NPA stood at 0.68%, down 26 basis points YoY and 8 basis points QoQ. The Provision Coverage Ratio remained robust at 90.46%.
Chatterjee noted that despite disruptions in the core geography, improved risk management helped bring Gross NPAs close to the Bank’s annual guidance, highlighting borrower resilience and the strength of the local economy.
Business Growth
During Q3, the Bank recorded strong business growth, with gross advances rising 17.3% YoY and deposits increasing 10.6% YoY. As of December 31, 2025, gross advances stood at Rs 1,16,248 crore, while total deposits reached Rs 1,55,861 crore.
The MD & CEO attributed this growth to focused expansion in retail, MSME, agriculture, and select corporate segments, supported by stronger customer engagement and improved credit appetite.
Capital Position and Initiatives
The Bank’s Capital Adequacy Ratio (CAR) under Basel III stood at 15%. Chatterjee said the approved capital raise of Rs 1,250 crore, along with internal accruals, would further strengthen capital buffers and support future expansion.
He also highlighted key initiatives, including the 2025 Rehabilitation Package for disturbance-affected borrowers and accelerated digital transformation to enhance customer experience, security, and operational efficiency.
