Indian Overseas Bank , a prominent player in the Indian banking sector, has reported impressive growth in its key financial metrics for the period ending September.

Strong Growth in Deposits

The bank announced a robust 12.00% year-on-year increase in total deposits. This double-digit growth underscores the bank's ability to attract and retain customer funds, reflecting positively on its market position and customer trust.

Substantial Rise in Advances

Alongside the growth in deposits, Indian Overseas Bank also reported a significant 12.90% year-on-year increase in gross advances. This growth in lending activities indicates a strong demand for credit and the bank's active role in supporting various sectors of the economy.

Balanced Growth Across Key Metrics

The simultaneous growth in both deposits and advances demonstrates Indian Overseas Bank's balanced approach to its banking operations. This parallel expansion in both sides of the balance sheet suggests a healthy and sustainable growth trajectory for the bank.

The double-digit growth in both deposits and advances positions Indian Overseas Bank favorably in the competitive banking landscape. This performance indicates the bank's strong market presence and its ability to capitalize on the growing financial needs of its customer base.

As the banking sector continues to evolve, Indian Overseas Bank's growth in these key areas may contribute to its overall financial health and market standing.

Indian Overseas Bank (IOB) has announced significant changes to its account policies and faced regulatory action, marking a mixed week for the public sector lender.

Waiver of Minimum Balance Charges

IOB has decided to waive penal charges for non-maintenance of minimum average balance in its regular savings accounts, effective October 1, 2025. This waiver will apply specifically to SB-Public accounts, providing relief to a large number of account holders. However, it's important to note that charges up to September 30, 2025, will continue under existing rules.

Managing Director & CEO Ajay Kumar Srivastava stated that this decision aims to "provide relief to account holders and improve banking experience." This move is expected to benefit many customers who struggle to maintain the required minimum balance in their accounts.

Exceptions to the Waiver

While this is good news for regular savings account holders, the bank clarified that premium savings accounts will not be included in this waiver. Accounts such as SB-MAX, SB-HNI, SB Prime, SB Priority, SB Privilege, and NRI accounts will continue to incur penalties for minimum balance shortfalls.

It's worth noting that IOB had previously waived such charges for government schemes like Pradhan Mantri Jan-Dhan Yojana and pensioner accounts, demonstrating a pattern of easing financial burdens on certain account holders.

RBI Penalty for Non-Compliance

In a separate development, the Reserve Bank of India (RBI) has imposed a penalty of ₹31.80 lakh on Indian Overseas Bank. According to the LODR (Listing Obligations and Disclosure Requirements) data filed by the bank, this penalty is related to non-compliance with Priority Sector Lending (PSL) directions.

Specifically, the bank was found to have collected loan-related charges on PSL accounts with sanctioned loans up to ₹25,000. This action was taken following the Statutory Inspection for Supervisory Evaluation (ISE 2024) conducted by RBI, which examined the bank's financial position as of March 31, 2024.

The penalty was imposed under the provisions of Section 47A(1)(c) read with Section 46(4)(i) and 51(1) of the Banking Regulation Act, 1949. IOB stated in its disclosure that this penalty would have no impact on the bank's financial, operational, or other activities.

Market Response

Despite the regulatory penalty, IOB's shares closed 2.67% higher at ₹39.54 on the day of these announcements. However, it's important to note that the bank's shares have seen a significant decline of 31.51% over the past 12 months, indicating ongoing challenges for the lender.

These developments highlight the complex landscape that public sector banks like IOB are navigating, balancing customer-friendly initiatives with regulatory compliance and financial performance.