Kotak Mahindra and IDFC First lift profits as some banks' margins narrow
Kotak Mahindra Bank's net profit rose 29.5% in the quarter and IDFC First Bank's tripled, while net interest margins slipped, Moody's reports.
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what happened
According to Moody's, Kotak Mahindra Bank's net profit for the quarter ended September 30, 2026 rose 29.5% to 4,212 crore rupees. Growth was driven mainly by other income, which climbed 23.4%. Net interest income increased 15.7%, and advances grew 25%.
IDFC First Bank's standalone profit tripled to 1,044.6 crore rupees from 352.3 crore a year earlier. Net interest income rose 21%, but the net interest margin fell 32 basis points to 5.58%. AU Small Finance Bank's profit increased 53% to 858 crore rupees.
why it matters
A narrower margin alongside strong loan growth suggests banks are funding lending with more expensive deposits, including FCNR(B) inflows. For Indian bank stocks, the balance between volume growth, asset quality and margin trends in coming quarters will matter most.
market impact
Indian banks: strong profit and loan growth supports the sector, but margin compression limits expectations
tags
instruments
sources
- Kotak Mahindra Bank, IDFC First PAT rise; Marginal dip in NIM on FCNR (B) inflows — Moody's, 24 October 2026 at 16:28 UTC
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