UCO Bank’s Q2 net profit rises 27% to ₹786 crore; advances grow 24.7%
Public sector lender UCO Bank reported a 26.77% year-on-year increase in net profit to ₹786 crore for the quarter ended September 30, 2026, supported by growth in interest income, advances and its retail, agriculture and MSME (RAM) portfolio. The bank’s total business expanded 18.81% to ₹6.37 lakh crore during the period, reflecting sustained credit demand and deposit mobilisation.
According to the bank’s financial results for the quarter and half year ended September 30, total advances rose 24.70% year-on-year to ₹2.88 lakh crore, while deposits grew 14.36% to ₹3.50 lakh crore. The bank’s operating profit increased 16.04% to ₹1,872 crore in the September quarter.
The results were announced on Thursday by the Bank’s MD and CEO (in-charge), Rajendra Kumar Savio and Executive Director Vijay N Kamble.
Net interest income (NII), the difference between interest earned and interest paid, increased 13.96% to ₹2,886 crore during the quarter, compared with ₹2,533 crore a year earlier. The global net interest margin improved by 10 basis points year-on-year to 3%, while the domestic margin rose by 11 basis points to 3.19%.
RAM portfolio drives credit growth
The bank’s retail, agriculture and MSME advances grew 26.92% year-on-year to ₹1.69 lakh crore, accounting for a substantial share of its domestic lending. Retail advances increased 30.23% to ₹76,817 crore, agricultural lending rose 29.59% to ₹41,014 crore, and MSME advances grew 20.32% to ₹50,905 crore.
Within retail lending, vehicle loans recorded particularly strong growth of 61.91%, while the home loan portfolio expanded 20.29% year-on-year.
On the deposits front, current account and savings account (CASA) balances increased 10.59% to ₹1.22 lakh crore. Current deposits rose 19.70% to ₹18,523 crore, while savings deposits grew 9.10% to ₹1.04 lakh crore. The CASA ratio stood at 36.77% at the end of September.
Asset quality improves
UCO Bank continued to report an improvement in asset quality. Gross non-performing assets (NPAs) declined by 60 basis points year-on-year to 1.96%, while net NPAs fell by 25 basis points to 0.18%. The provision coverage ratio, including technical write-offs, stood at 98.36%, indicating a high level of provisioning against stressed assets.
The bank’s capital adequacy ratio stood at 18.85% as of September 30, with the Tier I capital ratio at 17.27%. Its credit-deposit ratio increased to 82.29%, compared with 75.47% a year earlier.
Operational efficiency also improved, with business per employee rising to ₹30 crore from ₹25 crore a year ago. Business per branch increased to ₹185 crore from ₹161 crore.
The bank had 3,439 domestic branches and three international branches at the end of September. Around 61% of its domestic branches were located in rural and semi-urban areas.
The performance points to stronger earnings and expanding credit, alongside improved asset quality. However, the pace of deposit mobilisation relative to advances and the sustainability of margins will remain important factors to watch in the coming quarters.
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