Banks see double-digit credit growth in Q3 FY26 on strong lending

Six banks that reported their quarterly business updates for the October-December (Q3FY26) quarter on Friday recorded double-digit growth in their loan books compared with a year ago. Deposits also posted healthy growth during the period.

Illustration: Uttam Ghosh

State-owned Punjab National Bank reported a 10.15 per cent year-on-year (Y-o-Y) rise in domestic gross advances to Rs 11.68 trillion in Q3FY26 from Rs 10.60 trillion a year earlier.

Bank of India posted a 15.07 per cent Y-o-Y increase in advances to Rs 6.29 trillion from Rs 5.46 trillion, while UCO Bank’s advances grew 17.5 per cent Y-o-Y to Rs 2.15 trillion.

Among private sector lenders, South Indian Bank reported an 11.3 per cent Y-o-Y increase in advances to Rs 96,765 crore.

In an exchange filing, the bank said that during the quarter ended December 31, it wrote off Rs 900 crore.

“Had this not been done, the Y-o-Y growth as on December 31, 2025, would have been 12.43 per cent,” it said.

Tamilnad Mercantile Bank posted a 16.3 per cent Y-o-Y rise in advances to Rs 50,763 crore.

CSB Bank reported a sharp 29 per cent Y-o-Y increase in advances to Rs 37,208 crore, with nearly half of its loan book coming from advances against gold and gold jewellery (excluding receivables secured against gold), which stood at Rs 19,023 crore, up 46 per cent from a year ago.

Deposits also saw robust growth.

UCO Bank’s deposits rose 10.91 per cent Y-o-Y to Rs 2.92 trillion, while Punjab National Bank’s domestic deposits increased 8.32 per cent to Rs 15.97 trillion as of December 31, 2025.

Bank of India reported a 12.8 per cent Y-o-Y rise in deposits to Rs 7.65 trillion.

Among private sector banks, South Indian Bank’s deposits grew 12.17 per cent Y-o-Y to Rs 1.18 trillion, and Tamilnad Mercantile Bank recorded a 12.53 per cent increase to Rs 56,707 crore.

CSB Bank reported a 21 per cent Y-o-Y rise in deposits to Rs 40,460 crore as of December 31, 2025.