INTERNATIONAL JOURNAL OF ENGINEERING MANAGEMENT AND
SOCIAL SCIENCES

Financial Performance Evaluation of AU Small Finance Bank with Special Reference to Its Merger with Fincare Small Finance Bank

Mergers and acquisitions have become an important strategy for enhancing the financial performance, operational efficiency, and competitiveness of banks in India. The merger of AU Small Finance Bank with Fincare Small Finance Bank, effective from 1 April 2024, marked a significant development in the Small Finance Banking sector. This study evaluates the financial performance of AU Small Finance Bank by comparing the pre-merger period (FY2021–22 to FY2023–24) with the post-merger period (FY2024–25 to FY2025–26). The research is based on secondary data collected from the annual reports of AU Small Finance Bank, publications of the Reserve Bank of India (RBI), and other reliable financial sources. Financial performance was assessed using growth analysis, ratio analysis, and descriptive statistical tools, including Mean, Standard Deviation, and Coefficient of Variation. Key financial indicators such as Net Profit, Total Assets, Deposits, Advances, Shareholders' Equity, Return on Assets (ROA), Return on Equity (ROE), Earnings per Share (EPS), and Credit–Deposit Ratio (CDR) were analysed. The findings indicate that the merger contributed to improved profitability, stronger financial stability, enhanced operational efficiency, and sustained business growth. The study concludes that the AU–Fincare merger has strengthened the bank's overall financial performance and competitive position while providing useful insights into the effectiveness of mergers in the Indian Small Finance Banking sector