RBL Bank has delivered exceptional financial results for Q3FY26, showcasing remarkable profitability growth and improved asset quality metrics. The private sector lender's performance reflects strong operational efficiency amid ongoing business transformation.

Outstanding Financial Performance

The bank's financial metrics for Q3FY26 demonstrate exceptional growth across key parameters:

The standout performance was the bank's net profit, which surged dramatically from ₹33 crore in Q3FY25 to ₹214 crore in Q3FY26, representing a substantial 555% year-on-year growth. On a quarter-on-quarter basis, the lender reported a 20% increase in profitability.

Revenue Growth and Margin Dynamics

RBL Bank's interest income showed steady growth, reaching ₹1,657 crore in Q3FY26 compared to ₹1,585 crore in the same quarter last year. This 5% year-on-year increase reflects the bank's ability to maintain lending growth despite competitive market conditions. However, the net interest margin compressed to 4.63% from 4.90% in the previous year, indicating pressure on spreads.

Asset Quality Shows Improvement

The bank demonstrated significant improvement in asset quality metrics during the quarter:

Gross Non-Performing Assets declined notably to 1.88% as of December 31, 2025, from 2.32% at the end of September 2025. Net Non-Performing Assets also improved marginally to 0.55% from 0.57% over the same period. The provision coverage ratio, including technical write-offs, stood at a healthy 93.20%.

Analyst Outlook and Recommendations

Despite some challenges, analysts maintain a positive outlook on RBL Bank:

Motilal Oswal has maintained a Buy rating with a target price of ₹370, citing better-than-expected pre-provision operating profit supported by strong other income. The brokerage expects wholesale advances to grow 20-25% year-on-year and retail advances at 25-30%. Elara Capital retained an Accumulate rating while raising its target price to ₹345, noting that RBL Bank appears to be at an inflection point with early signs of stability across key operating metrics.

Market Performance and Future Prospects

RBL Bank shares have risen 25% in the last 6 months, reflecting investor confidence in the bank's turnaround story. The proposed capital infusion from Emirates NBD and the bank's aggressive provisioning strategy are expected to support improved credit growth and asset quality over time. Management has guided for healthy business expansion ahead, with plans to scale the unsecured portfolio at a calibrated pace while maintaining a comfortable credit-deposit ratio.

RBL Bank has announced the grant of 81,000 stock options to eligible employees under its Employee Stock Option Plan schemes. The Nomination and Remuneration Committee approved this grant on January 16, 2026, as part of the bank's employee incentive programs.

Stock Option Grant Details

The committee approved the grant of 81,000 stock options convertible into an equal number of equity shares of ₹10.00 each. These options were granted under two existing schemes - Employee Stock Option Plan 2013 (ESOP 2013) and Employee Stock Option Plan 2018 (ESOP 2018).

Pricing and Exercise Terms

The exercise price of ₹312.00 per option was determined based on the latest available closing price on January 14, 2026, which was the previous trading day prior to the grant date. This price was taken from the National Stock Exchange of India Limited, being the stock exchange that recorded the higher trading volume.

The pricing formula follows the bank's established policy of using the latest available closing price on the previous trading day prior to the grant date on the recognized stock exchange with higher trading volume.

Vesting and Exercise Schedule

The granted options follow a graded vesting structure spread over three years:

Employees will have a period of five years from the date of vesting to exercise their options, subject to the terms and conditions specified in ESOP 2013 and ESOP 2018.

Regulatory Compliance

Both ESOP 2013 and ESOP 2018 were originally formulated based on SEBI (Share Based Employee Benefits) Regulations and have been subsequently amended to align with the requirements of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021. The schemes were approved by shareholders and comply with current regulatory frameworks.

The bank has fulfilled its disclosure obligations under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, by informing both BSE Limited and National Stock Exchange of India Limited about this grant. The information has also been made available on the bank's website at www.rbl.bank.in in compliance with Regulation 46(2) of the regulations.