HDFC Bank, India's largest private sector lender, has reported a robust performance for the third quarter of fiscal year 2026, with net profit rising to ₹18,653.75 crore. This represents an 11.4% increase compared to the ₹16,735.50 crore profit reported in the same period last year. The bank's steady growth was supported by loan expansion and higher non-interest income, even as asset quality showed mild pressure.

The bank's net interest income (NII), a core measure of lending profitability, grew by 6.4% year-on-year to ₹32,615 crore. This increase reflects stable margins alongside balanced growth in deposits and advances. Core net interest margin (NIM) stood at 3.35%. Other income, which includes fees and treasury income, rose sharply by 15.7% year-on-year to ₹13,253.84 crore, aided by strong traction in core fee streams.

HDFC Bank's provisions and contingencies for the December quarter stood at ₹2,837.86 crore, lower than ₹3,500.53 crore in the September quarter and ₹3,153.85 crore in the corresponding quarter last year. This decrease in provisioning provided support to bottom-line growth and reflects the bank's confidence in its asset quality and risk management framework.

The bank's asset quality remained broadly stable on a sequential basis. The gross non-performing asset (NPA) ratio stood flat at 1.24% in Q3 FY26, while the net NPA ratio also remained unchanged at 0.42% compared with the previous quarter. However, in absolute terms, gross NPAs rose 2.59% quarter-on-quarter to ₹35,178.98 crore, while net NPAs increased 4.66% to ₹11,981.75 crore, reflecting incremental stress in certain loan segments.

On the liability side, total deposits stood at ₹28,60,100 crore as of December 31, 2025, registering a year-on-year growth of 11.6%. CASA (Current Account Savings Account) deposits grew 10.1%, with savings account deposits at ₹6,61,700 crore and current account deposits at ₹2,99,500 crore, underscoring the bank's continued focus on granular deposit mobilization. Gross advances rose 11.9% year-on-year to ₹28,44,600 crore. Retail loans grew by 6.9%, SME loans expanded by 17.2%, and corporate and wholesale loans rose by 10.3%.

The bank's total balance sheet size as of December 31, 2025, was ₹40,89,000 crore as against ₹37,59,000 crore as of December 31, 2024. The average deposits were ₹27,52,400 crore in Q3FY26, a growth of 12.2% over Q3FY25.

In other news, HDFC Bank announced that Mr. Bhavesh Zaveri, Executive Director, will retire on April 18, 2026. Mr. Zaveri, who was appointed for a three-year term in April 2023, has decided not to seek re-appointment as he plans to explore opportunities outside the banking sector, including within group companies.

Following the announcement of the results, the market showed a cautiously optimistic response. HDFC Bank's shares closed the session prior to the announcement at ₹930.55 apiece, marking a gain of 0.55%. Over the past year, the stock has delivered a return of 13.7% to its investors.