Jammu & Kashmir Bank Records 16.7% Growth In Net Profit At ₹484.84 Crore

Srinagar: Jammu and Kashmir Bank on Friday posted a 16.7 per cent increase in net profit at Rs 484.84 crore in the April-June quarter of FY26. The bank had reported a profit after tax (PAT) or net profit of Rs 415.49 crore in the same period of the previous fiscal year, J&K Bank said in a statement.

Net Interest Income (NII) during the reporting quarter grew 7 per cent year-on-year to Rs 1,465.43 crore, while the other income jumped 29 per cent to Rs 250.30 crore from Rs 194.10 crore recorded last year.

Return on Assets (RoA) in the quarter improved to 1.17 per cent from 1.08 per cent a year ago, while Net Interest Margin (NIM) stood at 3.72 per cent as against 3.86 per cent recorded in Q4FY25. Bank's cost-to-income ratio also improved to 60.78 per cent YoY, it said.

Operating profit witnessed a 13 per cent increase to Rs 672.84 crore from Rs 594.67 crore recorded in the corresponding period last year, the bank said. The bank's MD and CEO Amitava Chatterjee said that despite tough situation on the ground due to the Pahalgam terror attack along with its aftermath that affected business activity and credit offtake in key geographies well into June, "we have been able to deliver a healthy bottom line growth of around 17 per cent".

"The sudden decline in NIM should be viewed against the broader environment wherein repo rate cuts announced by the regulator impacted the margins," he said.

The profitability in Q1 is subdued on account of impairment provision of Rs 87 crore made in this quarter towards our investment in the RRB - Jammu and Kashmir Grameen Bank, necessitated by amalgamation of Ellaquai Dehati Bank with erstwhile J&K Grameen Bank w.e.f. April 30, 2025, the MD said. Excluding this non-recurring impact, our profitability growth would be upwards of 30 per cent YoY. This one-time provision has also impacted our ROA and ROE, however on a normalised basis both metrics remain broadly in line with our expectation, he added.

Chatterjee further said that the bank remains fundamentally strong, with adequate capital and liquidity buffers, and is already seeing signs of accelerating credit off-take on ground. "With improving conditions on the ground, we are sure to gain growth momentum in the coming quarters," the MD and CEO asserted. About business growth, he said the bank's deposits rose 12 per cent to Rs 14,8542 crore from Rs 13,2574 crore recorded in Q1 of the last fiscal, while the net advances grew 6.06 per cent to Rs 1,01,230 crore as against Rs 95,450 crore. The bank's CASA (current account-savings account) ratio stood at 45.71 per cent as on June 30, 2025.

"Regarding business growth, we are confident in our long term strategy as we are actively diversifying and scaling up our rest of India operations by opening more branches in strategic business centres, entering builder tie-ups, and strengthening partnerships with DSAs," the MD and CEO said.

"Going forward, our focus will also remain on deepening relationships in core geographies through sufficient lending to agriculture, industry and youth entrepreneurship; and investing further in digital capabilities and operational efficiency," he added. Chatterjee said the Gross Non-Performing Assets (GNPA) of the bank reduced by 41 basis points to 3.50 per cent (from 3.91 per cent a year ago), while Net NPA stood at 0.82 per cent. The bank's NPA Coverage Ratio remained strong at above 90 per cent.

On the asset quality, the MD and CEO said as per the annual guidance, the bank plans to bring it to around 3 per cent by the end of the current financial year through prudent lending, robust recovery mechanisms, and proactive monitoring using early warning systems and digital tools like its NPA tracker. The Bank's Capital Adequacy Ratio (CAR) stood at 15.98 per cent, providing a comfortable buffer for future growth, he said. "With CAR almost 16 per cent, we remain well capitalised and have an enabling board approval for raising further capital to fund our growth plans and seize emerging opportunities across our business segments," Chatterjee said.

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