Axis Bank on Monday reported a 25% year-on-year increase in its third quarter net profit to Rs 726 crore, helped by strong loan growth in both retail and corporate segments and a lower provision for bad loans. The Mumbai-based private sector lender said its net interest income, or the difference between interest earned and interest expended, grew 9.2% from a year ago to Rs 4,731.52 crore in the December quarter. In the previous quarter, it stood at Rs 4,539.62 crore. \u201cThere are clear signs that growth has started picking up. Our loan growth during the quarter was quite strong at 21%, and that growth was across all segments. The retail segment grew 29% year-on-year. In SME, we saw a growth of 27% and corporate credit grew 12%,\u201d said Jairam Sridharan, chief financial officer, Axis Bank. \u201cDemonetisation was announced in the third quarter of the previous fiscal. Hence, there is a strong base effect on most of these metrics. But despite that, it is quite clear that growth is starting to come back. While we might see some moderation in the fourth quarter, because the base effect will change, the overall strength of the market is visible in terms of loan demand growth,\u201d he added. The bank\u2019s total income declined to Rs 14,314.63 crore during the quarter from Rs 14,501.21 crore in the year-ago period, hurt by lower treasury income. In the previous quarter, it stood at Rs 13,820.62 crore. Other income, comprising fee, trading profit and miscellaneous income fell 24% year-on-year to Rs 2,593 crore. Provision for bad loans fell 26% from the year-ago period to Rs 2,811.04 crore in the December quarter, the bank said. In the previous quarter, it stood at Rs 3,140.41 crore. The gross non-performing assets (NPA) increased marginally to 5.28% in the December quarter from 5.22% a year ago, but was lower than 5.90% in the September quarter. The net NPA ratio increased to 2.56% from 2.18%. In the previous quarter it was 3.12%. \u201cRecoveries and upgrades were Rs 4,008 crore, while write-offs during the quarter were Rs 2,822 crore. In October-December, the bank recovered substantial amount in cash from an IT\/ITES account and also upgraded one account in the steel sector. These two accounts were part of the nine accounts that were reclassified as NPA by the bank in Q2FY18,\u201d Sridharan said. Axis Bank\u2019s total loan amount outstanding against the National Company Law Tribunal (NCLT) accounts declined by 14% from the previous quarter to Rs 6,074 crore as on December 31, 2017. The bank has made an incremental provisions of Rs 237 crore against these accounts, resulting in an increased provision coverage of 68% on these accounts.