Mauritius · Business
MCB Group, a Mauritian banking group, earned 9.9% more in the three months to September, even as its interest margins narrowed and its bad-loan provisions grew.
MCB Group Limited, a bank holding company based in Port Louis, Mauritius, said on Thursday 12 November 2026 that profit attributable to ordinary shareholders rose 9.9% to Rs 5.42 billion (Mauritian rupees, about US$114 million). The quarter ran from 1 July to 30 September 2026, the first three months of its financial year 2026/27, which ends on 30 June.
In the same quarter a year earlier the group made Rs 4.94 billion (about US$104 million). Net interest income, boosted by lending growth, led the gain, and about 69% of the group’s profit came from foreign-sourced operations.
For a US reader the main hook is the dollar. MCB says falling US dollar interest rates are already squeezing what it earns on its foreign-currency assets, so the Federal Reserve’s path reaches a bank on an Indian Ocean island.
Key Facts
- Who MCB Group, a Port Louis bank holding company with home markets in Mauritius, Maldives, Seychelles and Madagascar.
- Profit Quarter to 30 September 2026: Rs 5.42 billion (about US$114 million), up 9.9% on a year earlier.
- Bad loans Non-performing loans, where borrowers are not repaying, fell to 1.8% of all loans from 3.0%.
- Capital Capital cushion ratios eased to 19.6% overall and 17.4% for core (Tier 1) capital, above regulatory limits.
- Watch Loan-loss charges rose 33.7% and costs 13.5%, while income grew 11.7%.
What MCB Group Reported
Operating income, the group’s revenue before costs and loan losses, rose 11.7% to Rs 12.70 billion (about US$268 million). The corporate and investment banking and private banking arm, which serves large companies and wealthy clients, grew 15.1%, while its home markets, meaning Mauritius and the group’s foreign subsidiaries, grew 8.0%.
Net interest income, the gap between what the group earns on loans and pays on deposits, rose 17.4% to Rs 8.25 billion (about US$174 million). Loans and advances to customers reached Rs 503.6 billion (about US$10.6 billion), up from Rs 381.2 billion (about US$8.0 billion) a year earlier.
Net fee income grew 3.8% to Rs 2.26 billion (about US$48 million), helped by trade finance and wealth management. Total assets stood at Rs 1.31 trillion (about US$27.7 billion), 24.5% above a year earlier.
Why Margins Narrowed and Costs Rose
MCB says better yields on its rupee investment securities were offset by lower margins on its foreign-currency assets. It ties that to the decline in the US dollar benchmark rate and to a higher cost of funding.
Costs rose faster than income, with non-interest expenses up 13.5% to Rs 4.63 billion (about US$97 million). MCB cites inflation, higher staff costs from more employees, and more spending on professional fees and technology.
The cost-to-income ratio, the share of income spent on running costs, rose to 36.4% from 35.9%. A lower ratio is better, so the move is small and in the wrong direction.
Loan Quality and Capital
Impairment charges, money set aside for loans that may go bad, rose 33.7% to Rs 809 million (about US$17 million). MCB says this mainly reflects expected losses on a much larger loan book.
Even so, the gross non-performing loan ratio, the share of loans that borrowers are failing to repay on time, improved to 1.8% from 3.0% a year earlier. The annualised cost of risk, yearly loan losses measured against the loan book, was 50 basis points, or 0.5%.
The capital adequacy ratio, the buffer a bank must hold against risk, eased to 19.6%. The Tier 1 ratio, which counts only the highest-quality capital, fell to 17.4%.
MCB says both remain comfortably above regulatory limits and blames the dip on strong lending growth, which raises its risk-weighted assets. Equity attributable to shareholders reached Rs 135.7 billion (about US$2.9 billion).
What the Group Says About the Outlook
MCB describes a global economy that has stayed resilient despite tension in the Middle East, although energy and freight disruption keeps prices and inflation elevated. It says this has pushed major central banks toward a more restrictive stance.
In sub-Saharan Africa, it says growth is holding up, but high financing costs and possible El Niño disruption weigh on prospects. It calls Mauritius relatively resilient, backed by tourism and financial services, while the Maldives and Seychelles have been hit hardest by disruption to air travel.
For Madagascar the group expects growth to pick up on post-cyclone reconstruction and stronger agricultural exports. It adds that the strong start “reinforces the Board’s confidence in the outlook for the full financial year”.
What It Means for You
Readers with exposure to Mauritius, as investors, businesses or visitors, can read this as a sign that one of the island’s banking groups is lending more while keeping bad loans low. Our guide to the Mauritius economy and the MCB Group company profile give the wider picture.
The Bank of Mauritius, the central bank, lists its key rate at 5.00% as of 11 November 2026, and our report on that decision explains it. For the US trade angle, see why Mauritius gained two more years of duty-free US access, and follow all our Mauritius coverage.
What Is Not Known
MCB gives no profit target for the full year and no figure for expected loan growth. The numbers are unaudited, so only the accounts for the year to 30 June 2027 will be final.
The statement does not say how much of the margin squeeze came from the dollar rate and how much from funding costs. It also gives no year-earlier figures for the capital ratios, only that they decreased.
Frequently Asked Questions
How much profit did MCB Group make in the quarter?
MCB Group earned Rs 5.42 billion (about US$114 million) attributable to ordinary shareholders in the quarter to 30 September 2026. That is 9.9% more than the Rs 4.94 billion (about US$104 million) of a year earlier.
Why did MCB Group’s margins narrow?
The group says margins on its foreign-currency assets fell because the US dollar benchmark rate declined and funding cost more. Better yields on rupee investments offset only part of that squeeze.
Are MCB Group’s bad loans rising?
The gross non-performing loan ratio improved to 1.8% from 3.0% a year earlier. Impairment charges did rise 33.7%, which the group links to much faster loan growth.
Is MCB Group’s capital still strong?
The group says its capital adequacy ratio of 19.6% and Tier 1 ratio of 17.4% remain comfortably above regulatory limits. Both ratios eased because strong lending growth raised its risk-weighted assets.
Sources: MCB Group Limited, unaudited interim consolidated summary financial statements and comments on results for the period ended 30 September 2026, issued 12 November 2026 (https://mcbgroup.com/docs/default-source/investor-centre/financial-statements/mcb-group-fs-q1-2027.pdf); Bank of Mauritius, key rate and consolidated indicative rupee exchange rates, 11 and 12 November 2026 (https://www.bom.mu/markets/foreign-exchange/indicative-exchange-rate). Conversions use Rs 47.5 per US$, the midpoint of the Bank of Mauritius indicative buy and sell rates for notes on 12 November 2026 (RT carries no rupee quote), applied to the year-earlier quarter too.
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