City Union Bank shares surged over 6% in early trade after the private sector lender reported a solid performance for the December quarter, with healthy growth in profitability, strong net interest income expansion, and a continued improvement in asset quality.
City Union Bank delivered a robust set of Q3FY26 standalone numbers, reflecting stable loan growth, better operating efficiency, and controlled credit costs, which boosted investor confidence.
During the quarter, net interest income rose sharply by 28% year-on-year to ₹752 crore compared with ₹588 crore in the corresponding period last year. The strong NII growth was driven by higher advances, improved yields, and stable margins, underscoring the bank’s core business strength.
Operating profit for the quarter increased by 17.7% to ₹513 crore from ₹436 crore in the year-ago period. This growth came despite higher provisioning, highlighting steady operating leverage and disciplined cost management. Provisions rose to ₹96 crore, up 28% year-on-year, as the bank maintained a conservative stance on asset quality.
Net profit for the quarter climbed 16.1% year-on-year to ₹332 crore, compared with ₹286 crore in Q3FY25. The profit growth reflects a healthy balance between income expansion and prudent provisioning, even as the bank continued to strengthen its balance sheet.
Asset quality metrics showed notable improvement on a quarter-on-quarter basis. Gross non-performing assets declined to 2.17% from 2.42%, while net NPAs eased to 0.78% from 0.9%.
