Federal Bank
Strong NII growth on improved NIM: Interest income increased 8% to Rs 7238.31 crore, while interest expenses fell 1% to Rs 4292.42 crore in Q1FY2027. NII improved 26% to Rs 2945.89 crore in Q1FY2027.
Margins improve: The bank has shown 57 bps YoY decline in cost of deposits to 5.21%, while yield on advances declined 44 bps YoY to 8.73% in Q1FY2027. Thus, the NIM has improved 39 bps YoY to 3.33%, while rose 13 bps qoq to 3.33% in Q1FY2027.
Healthy growth in the core fee income: The non-interest income of the bank declined 6% to Rs 1048.38 crore in Q1FY2027. Bank has posted strong 20% growth in core fee income to Rs 885 crore and forex income moved up 41% to Rs 72 crore. The recoveries and other income improved 11% to Rs 69 crore in Q1FY2027. However, the treasury income eased 92% to Rs 22 crore causing overall decline in non-interest income in Q1FY2027.
Expense ratio improves: The operating expenses of the bank increased 11% to Rs 2096.94 crore, as other expenses moved up 7% to Rs 1175.25 crore, while employee expenses rose 16% to Rs 921.69 crore in Q1FY2027. Cost to income ratio improved to 52.5% in Q1FY2027 compared with 54.9% in Q1FY2026. Operating Profit moved up 22% to Rs 1897.33 crore.
Provisions and contingencies decline: The bank has shown 21% decline in provisions to Rs 318 crore. The loan loss provisions fell 28% to Rs 274 crore, while standard asset provisions increased 187% to Rs 43 crore in Q1FY2027.
PBT increased 37% to Rs 1579.62 crore in Q1FY2027. Effective tax rate was flat at 25.5% in Q1FY2027 from 25.5% in Q1FY2026. Net Profit increased 37% YoY to Rs 1176.93 crore in Q1FY2027.
Asset quality improves: The bank has improved asset quality in Q1FY2027.
The fresh slippages of loans stood at Rs 412 crore in Q1FY2027 compared with Rs 483 crore in previous quarter and Rs 661 crore in the corresponding quarter last year. The recoveries and upgradations of NPAs stood at Rs 157 crore, while the write-off of loans was at Rs 308 crore in Q1FY2027. The standard restructured loan book of the bank declined to Rs 1027 crore end June 2026 compared to Rs 1083 crore a quarter ago. Provision coverage ratio was steady at 87.37% at end June 2026 compared to 87.07% a quarter ago and improved from 74.41% a year ago. The capital adequacy ratio of the bank stood at 17.0% with Tier I ratio at 15.9% at end June 2026. The risk weighted assets of the bank has increased 12% YoY to Rs 241635 crore end June 2026,| Asset Quality Indicators: Federal Bank | ||||||||
| ? | Jun-26 | Mar-26 | Dec-25 | Sep-25 | Jun-25 | Variation | ? | |
| QoQ | YoY | ? | ||||||
| Gross NPA (Rs Crore) | 4282.34 | 4335.29 | 4446.86 | 4532.01 | 4669.66 | -1 | -8 | ? |
| Net NPA (Rs Crore) | 506.05 | 529.25 | 1068.04 | 1165.16 | 1157.64 | -4 | -56 | ? |
| % Gross NPA | 1.52 | 1.62 | 1.72 | 1.83 | 1.91 | -10 | -39 | ? |
| % Net NPA | 0.18 | 0.20 | 0.42 | 0.48 | 0.48 | -2 | -30 | ? |
| % PCR | 87.37 | 87.07 | 75.14 | 73.45 | 74.41 | 30 | 1296 | ? |
| % CRAR - Basel III | 16.97 | 17.25 | 15.20 | 15.71 | 16.03 | -28 | 94 | ? |
| % CRAR - Tier I - Basel III | 15.89 | 15.93 | 13.88 | 14.37 | 14.69 | -4 | 120 | ? |
| Variation in basis points for figures given in percentages and in % for figures in Rs crore | ||||||||
Business Highlights:
Business growth improves: The business of the bank has increased at an accelerated pace of 12% YoY to Rs 598584 crore end June 2026, as advances growth improved to 13% to Rs 278466 crore and deposits growth improved to 11% to Rs 320118 crore at end June 2026. With the faster growth in advances, the credit to deposit ratio improved to 87.0% at end June 2026 from 85.5% at end June 2025.
CASA deposits ratio improves: The CASA deposits of the bank increased 18% YoY to Rs 103163 crore at end June 2026. The current account deposits moved up 16% to Rs 22309 crore, while saving account deposits increased 19% to Rs 80854 crore end June 2026. The CASA ratio improved to 32.2% at end June 2026 compared to 30.3% at end June 2025. The term deposits have increased 8% to Rs 216955 crore end June 2026. The NRE deposits have galloped 13% to Rs 95710 crore end June 2026.
Healthy loan growth: Within the loan book, the retail loans increased 11% YoY to Rs 114321 crore at end June 2026, while credit to agriculture increased 3% to Rs 7981 crore and MSME credit increased 10% to Rs 25763 crore. The corporate credit has also increased 17% to Rs 130401 crore end June 2026. The share of retail, agriculture and MSME (RAM) eased to 53.2% at end June 2026 compared to 54.5% at end June 2025.
Investment book of the bank increased 17% YoY to Rs 80103 crore at end June 2026.
Branch expansion: The bank has added 10 branches and added 23 ATMs in Q1FY2027, taking overall tally to 1650 branches and 2135 ATM`s end June 2026.
Book value of the bank stood at Rs 162.3 per share at end June 2026, while the adjusted book value (net of NNPA and 10% of restructured advances) was Rs 159.8 per share at end June 2026.
Financial Performance FY2026:
Bank has posted 2% increase in net profit to Rs 4117.32 crore in the year ended March 2026 (FY2026). The net interest income increased 13% to Rs 10657.41 crore, while non-interest income moved up 17% to Rs 4440.39 crore, leading net total income to increase 14% to Rs 15097.80 crore in FY2026. The operating expenses increased 10% to Rs 7891.60 crore, while provision and contingencies jumped 151% to Rs 1836.67 crore. PBT increased 0% to Rs 5369.53 crore in FY2026. The cost-to-income ratio improved to 52.3% in FY2026 compared to 54.0% in FY2025. An effective tax rate eased to 23.3% in FY2026 compared to 24.5% in FY2025. The net profit has increased 2% to Rs 4117.32 crore in FY2026.| Federal Bank: Results | ||||||
| Particulars | 2606 (3) | 2506 (3) | Var % | 2603 (12) | 2503 (12) | Var % |
| Interest Earned | 7238.31 | 6686.63 | 8 | 27695.38 | 26365.25 | 5 |
| Interest Expended | 4292.42 | 4349.80 | -1 | 17037.97 | 16897.26 | 1 |
| Net Interest Income | 2945.89 | 2336.83 | 26 | 10657.41 | 9467.99 | 13 |
| Other Income | 1048.38 | 1112.98 | -6 | 4440.39 | 3801.25 | 17 |
| Net Total Income | 3994.27 | 3449.81 | 16 | 15097.80 | 13269.24 | 14 |
| Operating Expenses | 2096.94 | 1893.52 | 11 | 7891.60 | 7168.11 | 10 |
| Operating Profits | 1897.33 | 1556.29 | 22 | 7206.20 | 6101.13 | 18 |
| Provisions & Contingencies | 317.71 | 400.16 | -21 | 1836.67 | 733.06 | 151 |
| Profit Before Tax | 1579.62 | 1156.13 | 37 | 5369.53 | 5368.07 | 0 |
| Provision for tax | 402.69 | 294.38 | 37 | 1252.21 | 1316.18 | -5 |
| PAT | 1176.93 | 861.75 | 37 | 4117.32 | 4051.89 | 2 |
| EPS*(Rs) | 19.1 | 14.0 | ? | 16.7 | 16.5 | ? |
| Equity | 493.8 | 491.6 | ? | 493.0 | 491.2 | ? |
| Adj BV (Rs) | 159.8 | 134.8 | ? | 154.4 | 131.2 | ? |
| * EPS and Adj BV are calculated on diluted equity as given for each year. Face Value: Rs 2, Figures in Rs crore | ||||||
| Source: Capitaline Corporate Database | ||||||
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