Bank of Maharashtra’s fiscal third quarter net profit rose 36% year-on-year rise to Rs 1,406 crore amid strong loan growth despite adopting stricter underwriting standards.

The bank’s managing director and CEO Nidhu Saxena said total business crossed Rs 5 lakh crore for the first time. While gross advances grew 21% to Rs 2.28 lakh crore as of 31 December 2024, total deposits rose 13.5% to Rs 2.79 lakh crore.

Saxena said growing the bank’s top-line is not enough and the conscious plan is to also focus on bottom-line. 

The state-owned lender’s operating profit for the December quarter grew 14.5% year-on-year to Rs 2,303 crore. 

Net interest income (NII) rose 19% on year to Rs 2,943 crore.

In a bid to maintain high asset quality, the Pune-headquartered bank has not been underwriting certain segments of loans for the last two quarters. “Despite the tightening of underwriting standards, there has been no adverse impact on the bank’s growth,” said Saxena.

The bank's asset quality improved, with the gross non-performing assets (NPA) ratio falling to 1.80% at the end of December compared to 2.04% a year ago. 

Net NPA was flat on quarter at 0.20%, with the provision coverage ratio at 98.28%. In the same period a year ago, net NPA was at 0.22%.

The loan-to-deposit ratio rose to 81.95% at the end of December against 78.72% a quarter ago and 76.78% a year ago.

The bank’s CASA (current account savings account) ratio was largely stable at 49.28% sequentially, but lower than 50.19% a year ago.

For the nine-month period ended 31 December 2024, Bank of Maharashtra has reported a net profit of Rs 4,027 crore compared to Rs 2,837 crore a year ago.

Saxena said the bank may raise Rs 2,500 crore through the QIP (qualified institutional placement) route in FY26 to bring down the government shareholding below 75% from 79.60% at present.

On 5 October, Bank of Maharashtra raised Rs 3,500 crore through QIP. The shareholding of the government accordingly fell from 86.46% to 79.60% as of 31 December 2024.

State-owned banks have to raise public shareholding to a minimum 25% by August 2026.

Saxena said the bank is well-capitalised for growth and there is no need for immediate capital raising.