Mumbai, January 14, 2026, 21:12 IST
- Union Bank of India’s quarterly profit rose 9% from a year earlier, helped by lower bad-loan ratios.
- Net interest margin slipped year-on-year, even as core interest income stayed broadly steady.
- The stock climbed about 7% in afternoon trade after the numbers.
Shares of state-run Union Bank of India rose about 7% on Wednesday after it reported a rise in December-quarter profit and an improvement in asset quality. The stock traded around 6.9% higher at about 177 rupees on the NSE in afternoon trade, according to Upstox data. Upstox
The results matter now because investors have been leaning on public-sector lenders for cleaner balance sheets after a long clean-up cycle. But funding has become the next test: deposit growth has lagged loan growth for many banks, squeezing margins in a competitive market for savings.
Union Bank said net profit rose 9% from a year earlier to 50.17 billion rupees ($603 million) for the quarter ended Dec. 31, 2025. Net interest income — the difference between interest earned on loans and paid on deposits — rose 1% to 93.28 billion rupees, it said in a regulatory filing. Livemint
Net interest margin, a key profitability gauge for lenders, fell to 2.76% from 2.91% a year earlier, according to figures cited by Upstox. A basis point is one-hundredth of a percentage point.
Asset quality improved. Gross non-performing assets (NPAs) — loans that have stopped paying back, typically past due more than 90 days — fell to 3.06% of advances, while net NPAs declined to 0.51% as of Dec. 31, 2025, the filing showed.
Business growth was mixed. Union Bank reported year-on-year growth in total business of about 5%, with gross advances up a little over 7% and deposits up about 3% as of Dec. 31, 2025.
The bank’s credit-deposit ratio rose to 83.8 from 79.6 in the previous quarter, Upstox reported, as loan growth outpaced deposits. A higher ratio can lift earnings in good times, but it also raises the urgency to add deposits without paying sharply higher rates.
Other state-run lenders have also started reporting December-quarter numbers this week, giving investors fresh points of comparison on margins and bad-loan trends. Bank of Maharashtra reported a 26.5% rise in quarterly profit and a 16% jump in net interest income, Economic Times reported. Economictimes
But the margin line is still the swing factor. If deposit pricing stays tight while loan yields cool, profitability can soften even with stable asset quality, especially for banks pushing retail growth.
