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The Board of Directors of AU Small Finance Bank Limited at its meeting held today, approved the financial results for the quarter and financial year ended 31^st March, 2025.

Executive Summary

AU SFB declared strong performance for FY25 in the backdrop of a challenging macroeconomic environment during the year - lower than expected GDP growth, challenging credit environment, tight liquidity, persistent inflation and elevated interest rates. Bank has delivered a well-rounded performance with RoA of 1.5% while focusing on tighter underwriting, managing cost of funds and controlling operational expenses.

Board of Directors approved a dividend of Rs 1/- per share (10% of face value) for FY 2024-25 subject to shareholder’s approval.

Performance at a glance:

Q4’FY25 highlights

• The Bank’s Net Interest Income (NII) grew 57% YoY to Rs 2,094 Crore compared to ?1,337 Crore during Q4’FY24
• Other Income grew by 41% in Q4’FY25 to Rs 761 Crore compared to 541 Crore in Q4’FY24
• The Bank’s pre-provisioning operating profit (PPoP) for Q4’FY25 grew 99% YoY to Rs 1,292 Crore compared to ?650 Crore in Q4’FY24
• PAT was up 18% YoY for Q4’FY25 at Rs 504 Crore vs. Rs 428 Crore in Q4’FY24 
• Cost to Income improved to 55% in Q4’FY25 vs. 65% in Q4’FY24
• Net Interest Margin (NIM) for Q4’FY25 stood at 5.8% compared to 5.1% in Q4’FY24
• The Return on Asset (ROA) and Return on Equity (ROE) for Q4’FY25 stood at 1.4% and 11.9% respectively

FY25 highlights

Earnings

• The Bank’s Net Interest Income (NII) grew 55% YoY to Rs 8,012 Crore compared to Rs 5,157 Crore during FY24
• Other Income grew by 49% in FY25 to Rs  2,526 Crore compared to 1,697 Crore in FY24
• The Bank’s pre-provisioning operating profit (PPoP) for FY25 grew 86% YoY to Rs 4,581 Crore compared to ?2,466 Crore in FY24
• The net profit at Rs 2,106 Crore FY25 grew 32% YoY compared to Rs 1,592 Crore in FY24 (FY24 PAT including exceptional item was at ?1,535 Crore)
• Cost to Income decline by ~7% from 64% in FY24 to 57% in FY25
• Net Interest Margin (NIM) for FY25 stood at 5.94% compared to 5.45% in FY24
• Return on Asset (ROA) and Return on Equity (ROE) stood at 1.5% and 13.1% respectively
• EPS at Rs 28 grew by 19% YoY whereas Book Value Per Share (BVPS) at Rs 231 grew by 23%

Advances

• Gross loan portfolio (GLP) stood at Rs 115,704 Crore, registering a YoY growth of 20% from merged numbers and QoQ growth of 6.2%
• Secured businesses were up 25.3% YoY and 8.1% QoQ
• Unsecured businesses de-grew 17.6% YoY and by 10.1% QoQ and driven by industry wide deleverage in MFI and corrective actions taken in Credit Cards
• Yield on gross advances was stable at 14.4%
• 82% of new disbursements were in high-RoA businesses for FY25

Deposits

• Total Deposits grew 27% YoY compared to opening merged financials and 10.7% QoQ; CASA ratio at 29% as on Mar’25
• CA/SA deposits have grown by 28%/12% YoY and 24%/2% QoQ
• CASA + Retail TD stands at 62% and CASA + Retail TD + Non-callable Bulk TD is 78% of total deposits
• Cost of Funds (CoF) for FY25 at 7.07%; CoF for Q4’FY25 increased by 7 bps QoQ to 7.14%

Balance Sheet

• Credit Deposit (CD) ratio as on 31^st March 2025 stood at 79% excluding advances created out of refinance from Development Finance Institutions (DFI) like NABARD, SIDBI, NHB, MUDRA
• The Bank had a Liquidity Coverage Ratio (LCR) of 116% for Q4’FY25 and continues to maintain additional liquidity buffers in the form of high-quality, liquid, non-SLR investments, which are not part of LCR computation
• Shareholder’s fund of the Bank has now reached Rs17,166 Crore
• Capital adequacy ratio as on 31^st Mar’25 stands at 20.1% and Tier I capital adequacy stands at 18.1%

Asset Quality

• GNPA improved to 2.28% vs 2.31% in Q3 and NNPA improved to 0.74% vs. 0.91% in Q3 
• Additionally, Bank carries Rs 17 Crore of contingency and ?41 Crore of floating provision 
• Net credit cost for FY25 is at 1.3% of the Total Assets 
• Provision coverage ratio including technical write off improved to 84% from 80% in Q3’FY25

Other key updates

Credit Rating

• AA+/ Stable for Fixed deposit program by CRISIL
• AA/ Stable for long term Tier II Bonds by CRISIL, ICRA, India Ratings and CARE
• A1+ for short term Certificate of Deposit program by CRISIL, India Ratings and CARE

Initiatives & Awards for FY25

• Bank raised Rs 770 Crore capital in March’25 via Tier-II bond issuance 
• Launched ‘AU Eternity’ - a luxury Banking Program in collaboration with Mastercard. It is designed to complement ‘AU IVY’, ‘AU Royale’ and ‘AU Platinum’

Awards and recognition:

• Awarded “Best SIP Performer in Bank Category 2024” & “Best Performer in Bank Category 2024 ” by Bombay Stock Exchange.
• Declared as the “Best Small Finance Bank” At Mint BFSI Summit & Awards
• Awarded with “Best ESG Practices” At ASSOCHAM 19th Annual Summit & Awards 2024.
• Secured 56th rank in “Great Companies to Work in 2024” & Adjudged “Top 50 Best Place to Work for Millennials” by Great place to Work
• Awarded with “Best Cloud Management and Infrastructure Initiative Award” at ET Now Data Center & Cloud Innovation Summit & Awards 2024.
• Awarded for “Employee Engagement” and for “HR Business Partnership Function” by Peoplefirst HR Excellence Award 2024
• Awarded “Best Tech Talent & Organization”, “Best Technology Bank”, “Best Digital Sales, Payments & Engagement” in SFB category at 20th Indian Banks Association Annual Banking Technology Awards 2024

CSR initiatives:

• AU Ignite, Bank's skills training academy across 16 centers in Rajasthan, has, till date, trained 29,500 youths of which 21,500+ were linked to employment
• AU Bano Champion, our rural sports coaching initiative, is live across 60 locations with 8,100+ children benefited across 7 sports
• AU Udyogini, our flagship Women Entrepreneurship program, has till date engaged 3,900+ women with 2,152 of them nurtured under Individual Women Entrepreneurship

Commenting on the performance, Mr. Sanjay Agarwal, Founder, MD & CEO, AU Small Finance Bank said, ““We are coming out of a tough macroeconomic environment marked by persistent inflation, tight liquidity, a challenging credit environment, and lower-than-expected GDP growth. As we enter FY26, the economic outlook remains uncertain, driven largely by global factors such as tariff war and geopolitical developments. However, India is comparatively well-positioned, with both the Central Government and the RBI implementing supportive measures—including tax rationalization, interest rate cuts, and the injection of durable liquidity into the banking system.

Against this backdrop, we have delivered a strong performance with higher than sectoral growth in both deposits and advances. We made meaningful progress on productivity and efficiency, which enabled us to deliver stronger profitability—even amid a credit cycle in unsecured businesses of microfinance and credit cards.

As we celebrate 30 years of AU and 8 years of our banking journey, we remain focused on building an institution that can truly scale with sustainability. I want to express my sincere gratitude to all stakeholders for their continued trust and support. We remain committed to driving financial inclusion, empowering individuals and businesses, and contributing towards strengthening India’s economic resilience and advancing sustainable growth”.

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