IOB's Financial Triumph in Q3 FY25

Indian Overseas Bank (IOB) has announced a remarkable 20.9% increase in net profit, reaching Rs 874 crore for the quarter ending December 31, 2024. This growth, up from Rs 723 crore in the same quarter the previous year, underscores the bank's robust financial health and strategic acumen.

Strategic Fundraising and Shareholding Adjustments

In a strategic move to bolster its capital, IOB plans to raise Rs 2,000 crore through a Qualified Institutional Placement (QIP) in the current quarter. This initiative is expected to reduce the Centre's shareholding in the bank by 2%-2.5%, signaling a shift towards greater financial autonomy and market-driven growth strategies.

Interest Income and Asset Quality Improvements

The bank's interest income saw a significant 15.2% rise to Rs 7,112 crore in the October-December quarter of 2024-25, compared to Rs 6,176 crore in the previous year. Furthermore, IOB has made notable progress in asset quality, with the gross NPA ratio decreasing to 2.55% in Q3 FY25 from 3.9% as of December 31, 2023, and the net NPA ratio improving to 0.42% from 0.62% in the same period.

Recovery Efforts and Deposit Growth

Despite a 15.1% decrease in recovery to Rs 956.6 crore for the quarter ended December 31, 2024, IOB has achieved a 9.7% year-on-year growth in total deposits, amounting to Rs 3,05,121 crore. The bank's strategic reduction in high-cost bulk deposits by about Rs 7,000 crore reflects its commitment to optimizing its deposit portfolio and enhancing financial stability.