South Indian Bank Q2 net profit rises 8 pc, interest margin compresses

Mumbai, Oct 16 (PTI) South Indian Bank on Thursday reported an 8 per cent rise in its September quarter net profit at Rs 351 crore, driven by non-core income and a reduction in provisions.

The private sector lender had reported a net profit of Rs 325 crore in the year-ago period.

Its core net interest income declined by 8 per cent to Rs 808 crore despite a 10 per cent loan growth, because of a sharp compression in net interest margin (NIM).

NIMs came down to 2.80 per cent, from 3.24 per cent in the year-ago period, and the bank's chief executive and managing director P R Seshadri said it aspires to widen the number to 3 per cent, but did not give a timeline by which it will reach there.

The bank's non-interest income rose 26 per cent to Rs 516 crore during the quarter, which helped in the overall profit of the bank.

Provisions and contingencies dropped by 43 per cent on-year to Rs 63 crore during the reporting period, aiding the profit growth.

The gross non-performing assets ratio came down to 2.93 per cent from 4.40 per cent in the year-ago period and 3.15 per cent three months ago.

The bank's overall employee base came down to 9,242 from 9,667 in the year-ago period, which was attributed by the MD to a trend where the bank is not filling up positions created by retirees and other attrition.

He clarified that there is no involuntary attrition in the bank, and the lender will be adding people from now on, especially in the sales function.

The number of branches reduced to 948 in September 2025 from 955 in the year-ago period due to a consolidation caused by a focus on productivity enhancements, the bank said.

The SIB scrip closed 0.43 per cent up at Rs 32.94 apiece on the BSE on Thursday, as against gains of 1.04 per cent in the benchmark. PTI AA HVA