IOB’s Q3 Jump Isn’t Just a Low-Base Bounce—It’s Credit Growth + Cleaner Book, With an ECL Buffer Built In

posted a strong Q3 FY26 with net profit up 56% YoY to ₹1,365 crore, driven by 24% loan growth and improving asset quality—exactly the combination PSU banks need to sustain re-rating. ​ The more underappreciated signal: IOB also created a ₹1,500 crore additional provisioning buffer ahead of the expected credit loss (ECL) regime becoming applicable from April 2027, indicating proactive balance-sheet positioning. What improved under the hood Operating profit rose 15% to ₹2,603 crore, supported by 18% growth in net interest income to ₹3,299 crore and 16% rise in other income to ₹1,499 crore. ​ Net interest margin ticked up to 3.42% from 3.35% QoQ, suggesting spreads are holding even as growth accelerates. ​ Asset quality is doing the heavy lifting Gross NPAs fell to 1.55% from 1.83% QoQ and 2.55% YoY, reflecting continued slippage control and recoveries. ​ That fall in GNPA matters because it frees up profit through lower credit costs over time—especially if the bank can keep growth calibrated. Source: Economic Times No Recommendation