Indian Overseas Bank (IOB) has reported its highest-ever quarter net profit and expects to maintain its good run of over Rs 1,000 crore in the coming quarters of the current financial year as well.

The state-owned bank reported a 76% year-on-year rise in net profit to Rs 1,111 crore in the June quarter, crossing the earlier figure of Rs 1,051 crore in the three-month period ended March. 

IOB is planning to raise Rs 4,000 crore during the current financial year through various instruments, including qualified institutional placement (QIP). With this, the government’s stake would come down to 90% from the current 94%.

In the previous fiscal, the Chennai-headquartered bank raised about Rs 1,440 crore. 

The bank expects its total business to grow over 12% in the current financial year, similar to the growth pace in the previous fiscal. 

The loan book growth should be around 12-13% during the current financial year. The gold loan portfolio is expected to see a 37-38% growth.

In the first quarter of FY26, the bank's gross advances grew 14% to Rs 2.62 lakh crore from Rs 2.30 lakh crore a year ago.

Deposits grew to Rs 3.31 lakh crore, up 10.75% from the earlier year.

CASA (current account savings account) grew 15% hear-on-year to Rs 1.45 lakh crore. CASA ratio improved by 161 basis points to 43.78% as on 30 June 2025.

The bank has guided to a recovery of Rs 4,500 crore from bad loans during the fiscal. In the first quarter of FY26, the lender has recovered Rs 851 crore. 

Asset quality improved during the quarter, with the bank’s gross non-performing asset at 1.97% as of June 2025 compared to 2.14% in the preceding March quarter. Net NPA improved to 0.32% from 0.37%.

Slippage ratio improved by 3 bps to 0.10% while credit cost stood stable at 0.29%.

Net interest income grew 13% to Rs 2,747 crore from Rs 2,441 crore a year ago. Net interest margin stood at 3.04%.

Provisions fell to Rs 844 crore at the end of June, from Rs 1,063 crore in March.

The bank is planning to open a branch in Gift City, Gandhi Nagar, for which it is awaiting approvals.