Kotak Bank Q3 Advances Rise 16% to ₹4.8 Lakh Crore

Introduction

Kotak Mahindra Bank Limited has released its provisional business update for the third quarter of the fiscal year 2026, ending December 31, 2025. The private sector lender reported a robust 16% year-on-year (YoY) growth in its net advances, which reached ₹4.80 lakh crore. This performance highlights sustained momentum in its lending operations, complemented by healthy growth in deposits.

Advances Show Robust Growth

The bank's net advances saw a significant increase from ₹4.14 lakh crore in the corresponding quarter of the previous year. On a sequential basis, the loan book expanded by 3.8%, up from ₹4.63 lakh crore at the end of September 2025. This consistent growth in both yearly and quarterly terms indicates strong credit demand and effective disbursement strategies by the bank.

A Look at Average Balances

Beyond the end-of-period figures, the bank's average net advances for the quarter also demonstrated strong performance. The average balance stood at ₹4.66 lakh crore, marking a 16.2% increase YoY from ₹4.01 lakh crore. Sequentially, average advances grew by 4.0% from ₹4.48 lakh crore. These figures suggest that lending activity was consistent and steady throughout the entire quarter, not just concentrated at the end.

Deposit Mobilisation Remains Strong

Mirroring the growth in its loan book, Kotak Mahindra Bank's total deposits also recorded healthy expansion. Total deposits reached ₹5.43 lakh crore as of December 31, 2025, a 14.6% increase from ₹4.73 lakh crore in the same period last year. The quarter-on-quarter (QoQ) growth was 2.6%, up from ₹5.28 lakh crore at the end of Q2 FY26. This balanced growth in both assets and liabilities is a key indicator of financial stability.

CASA Performance Analysis

The bank's Current Account Savings Account (CASA) deposits, a crucial source of low-cost funds, stood at ₹2.24 lakh crore. This represents an 11.9% YoY increase from ₹2.00 lakh crore. However, the sequential growth was marginal at 0.2%, remaining largely unchanged from the previous quarter. While the annual growth is positive, the flat quarterly performance may indicate increased competition for low-cost deposits within the banking sector.

Q3 FY26 Provisional Financial Highlights

Market Reaction and Stock Performance

Following the release of these provisional figures, the market response was relatively muted. On the day of the announcement, shares of Kotak Mahindra Bank closed 0.2% lower at ₹2,190.90 on the National Stock Exchange. The stock has delivered approximately 19% returns over the past year, reflecting investor confidence in its long-term performance despite minor daily fluctuations.

Strategic Context and Outlook

The bank's performance aligns with its stated strategy of growing its loan book at a rate of 1.5 to 2 times the nominal GDP growth. The consistent expansion in both secured and unsecured portfolios, particularly in home loans and consumer assets, has been a key driver. The healthy Credit-Deposit (CD) ratio further underscores the bank's efficient use of its liability franchise to fund asset growth. These provisional numbers affirm a positive operational trajectory for the bank heading into the final quarter of the fiscal year.

Conclusion

Kotak Mahindra Bank's Q3 FY26 update showcases a period of balanced and sustained growth across key metrics. The double-digit increase in both advances and deposits reinforces its strong market position. It is important to note that these figures are provisional and subject to a limited review by statutory auditors. The market will now await the bank's detailed financial results for the quarter for a complete picture of its profitability and asset quality.