South Indian Bank532218Earnings call transcript

Q2 FY27 earnings call: profit INR426 crores, NIM 3.33%, gross NPA 1.24%

Transcript of the Q2 FY27 earnings call held on October 16, 2026 is now on the exchanges.

By ScoutQuest · Fri 23 Oct 2026, 9:39 AM IST · 3 min read

Net Profit: INR426 crores, up 21% year-on-year
Deposits and Gross Advances: Deposits INR1,37,279 crores and gross advances INR1,09,517 crores, both up 19%
NIM / ROA / ROE: NIM 3.33%, ROA 1.08%, ROE 14%

South Indian Bank has released the transcript of its Q2 FY27 earnings conference call, held on October 16, 2026, where the management team led by Managing Director and CEO Mahesh Muralidhar Pai discussed the quarter ended September 2026 and took questions from analysts.

Headline numbers for the quarter

Net profit of INR426 crores, the bank's highest for a quarter, up 21% from INR351 crores in the same quarter a year earlier.
Net interest income of INR1,116 crores, up 38% from INR808 crores.
Total deposits grew 19% year-on-year to INR1,37,279 crores from INR1,15,635 crores.
Gross advances grew 19% to INR1,09,517 crores from INR92,286 crores. Excluding a technical write-off of INR1,163 crores done last financial year, the growth works out to 20%.
Total business grew 19% to INR2,46,796 crores.
Net interest margin was 3.33 percentage, up 10 basis points sequentially and 53 basis points year-on-year.
Return on asset was 1.08% and return on equity 14% for the quarter.
Capital adequacy stood at 19.40% and the Tier 1 ratio at 18.71% as of September 30, 2026.
CASA rose 18% year-on-year to INR43,310 crores from INR36,841 crores.

Asset quality

Gross NPA fell 169 basis points year-on-year from 2.93 percentage to 1.24 percentage.
Net NPA fell 47 basis points from 0.56 percentage to 0.09 percentage.
Provision coverage ratio including write-off improved to 97.84 percentage from 90.25 percentage; excluding write-off it improved to 92.42 percentage from 81.29 percentage.
Slippage ratio for the quarter was 0.09% and credit cost 0.14 percentage.

What management said on the call

On the rise in credit cost, the MD said there was no cause for concern, that the bank's SMA and NPA levels are among the lowest in the industry, and that the higher provisioning was a conservative, account-based measure rather than floating or one-off provisions.
On expected credit loss based provisioning, management said it sees no concern at this point given low SMA-1, SMA-2 and SMA-0 levels.
Current account balances rose 20% quarter-on-quarter, but management said part of this came from one-off IPO-related flows at the end of September and some minor slippage in that number is possible; deposit and CASA growth otherwise was described as stable.
On the draft bancassurance circular, management said third-party income is only about 5% to 6% or maybe 7% of total fee income for the bank, so the impact is limited compared with other banks.
Management expects the fee income momentum to improve from the present position, describing it as core income with no one-offs and quarter-on-quarter improvement.
Management said it will continue the momentum in disbursements and collections in the coming quarters to achieve the desired targets.

What a retail investor can take away

The call presents a quarter of broad-based growth in profit, loans, deposits and net interest income alongside a sharp year-on-year reduction in bad loans and a high provision cover.
Management's stated forward view covers sustaining fee income growth, continuing disbursement and collection momentum, and no expected stress from expected credit loss provisioning; it also flags that the current account growth included one-off IPO flows.

The MD also thanked his predecessor, P.R. Seshadri, for the quarter's performance.

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