Private sector bank, Axis Bank has reported a growth of more than 25% in its net profit to Rs 920 crore in the second quarter of the current fiscal year-on-year basis, due to a strong growth in net interest income.

The bank's net interest income grew 24% to Rs 2,007 crore backed by the growth in loan disannulments. Its loan advances rose 27% to Rs 1.41 lakh crore in the second quarter compared to the same period previous year. Meanwhile, the deposits in the bank grew 26% to Rs 82,140 crore in the quarter.

The net interest margin improved to 3.78% as against 3.28% in the earlier quarter this year. The bank was also able to increase the share of current account and savings account (CASA) to its total deposits. Its CASA ratio stood at 42% compared with 40.53% in the April-June quarter.

"The sequential up-tick in NIM during Q2FY12 was driven by stronger build-up in CASA deposits, stable funding rates and a pick-up in loan yields," the bank said in a statement.

The bank also increased its earnings due to a 32% rise in fee income to 1,121 crore and through a rise in other income from Rs 1,033 crore to Rs 1,235 crore. On the other hand, the bank's Net non-performing assets (NPAs) grew from 0.31% to 0.34% quarter-on-quarter and its NPAs rose from 1.06% to 1.08% in the quarter.