Federal Bank reports strong Q4 FY26 results with net profit at ₹1,259 crore, CASA and NR deposits crossing ₹1 lakh crore, improved asset quality, and robust growth across key segments.
Mumbai: Federal Bank has delivered a strong and structurally robust performance for the quarter ended March 31, 2026 (Q4 FY26), marked by solid profitability, improved margins, and historic milestones in deposits and asset quality.
The bank reported a net profit of ₹1,259.10 crore for the quarter, registering a sharp sequential growth of 20.93%, driven by stronger core earnings. For the full financial year FY26, net profit stood at ₹4,117.32 crore. The quarter reflected steady alignment with the bank’s strategic priorities, including margin expansion, rising fee income, and improved operating efficiency.
A key highlight of the quarter was the strengthening of the bank’s liability franchise. Federal Bank successfully optimized its funding profile by focusing on retail deposits while reducing dependence on bulk deposits, bringing down the cost of funds to 5.46%. In a significant milestone, both CASA (Current Account Savings Account) balances and Non-Resident (NR) deposits crossed the ₹1 lakh crore mark. CASA balances rose to ₹1,03,390.30 crore, pushing the CASA ratio to 32.94%, up 271 basis points year-on-year, while NR deposits reached ₹1,02,619.69 crore, reflecting a 7.04% quarter-on-quarter growth.
On the asset side, the bank continued to see healthy traction in its targeted segments. Commercial Banking grew by 5.92% sequentially, while Retail Banking expanded by 3.21%. Gross advances rose to ₹2,68,369.03 crore, up 3.65% from the previous quarter, supported by growth in commercial, retail, and CV/CE segments. Total business reached ₹5,78,503.76 crore, registering a 4.54% sequential increase, while total deposits climbed to ₹3,13,909.39 crore, up 5.41%.
Fee income remained a standout performer during the quarter, increasing by 10.54% sequentially to ₹990.92 crore, underlining the bank’s growing focus on non-interest income streams. Operating efficiency also improved significantly, with the cost-to-income ratio declining to 47.28%, a reduction of 665 basis points compared to the previous quarter.
Asset quality saw further strengthening, with Gross Non-Performing Assets (GNPA) and Net Non-Performing Assets (NNPA) falling to record lows of 1.62% and 0.20%, respectively. The Provision Coverage Ratio (excluding technical write-offs) improved to 87.07%, indicating stronger balance sheet resilience.
Return metrics also showed notable improvement, with Return on Assets (RoA) rising to 1.36% and Net Interest Margin (NIM) to 3.74%, both returning to pre-rate cut levels. Return on Equity (RoE) expanded to 13.69%, reflecting improved profitability and capital efficiency.
During the quarter, the bank also launched its in-house wealth management platform, marking a strategic expansion into wealth services and opening new avenues for customer engagement and fee-based income growth.
Commenting on the performance, Managing Director and CEO KVS Manian said the results reflect a strong operational quarter aligned with the bank’s long-term strategy. He highlighted the successful restructuring of liabilities, the achievement of crossing ₹1 lakh crore in both CASA and NR deposits, and the recovery of key return metrics as indicators of the bank’s strengthened foundation for future growth.
As part of its expansion strategy, Federal Bank added 39 new branches during the quarter. The network expansion is being guided by a data-driven approach, incorporating insights from external studies to enhance efficiency and impact.
Despite global geopolitical uncertainties, the bank maintained a balanced risk approach, enabling it to keep asset quality at decadal lows. The continued focus on selected high-growth segments is expected to provide resilience and support sustained performance in the coming quarters.
Mumbai: Federal Bank has delivered a strong and structurally robust performance for the quarter ended March 31, 2026 (Q4 FY26), marked by solid profitability, improved margins, and historic milestones in deposits and asset quality.
The bank reported a net profit of ₹1,259.10 crore for the quarter, registering a sharp sequential growth of 20.93%, driven by stronger core earnings. For the full financial year FY26, net profit stood at ₹4,117.32 crore. The quarter reflected steady alignment with the bank’s strategic priorities, including margin expansion, rising fee income, and improved operating efficiency.
A key highlight of the quarter was the strengthening of the bank’s liability franchise. Federal Bank successfully optimized its funding profile by focusing on retail deposits while reducing dependence on bulk deposits, bringing down the cost of funds to 5.46%. In a significant milestone, both CASA (Current Account Savings Account) balances and Non-Resident (NR) deposits crossed the ₹1 lakh crore mark. CASA balances rose to ₹1,03,390.30 crore, pushing the CASA ratio to 32.94%, up 271 basis points year-on-year, while NR deposits reached ₹1,02,619.69 crore, reflecting a 7.04% quarter-on-quarter growth.
On the asset side, the bank continued to see healthy traction in its targeted segments. Commercial Banking grew by 5.92% sequentially, while Retail Banking expanded by 3.21%. Gross advances rose to ₹2,68,369.03 crore, up 3.65% from the previous quarter, supported by growth in commercial, retail, and CV/CE segments. Total business reached ₹5,78,503.76 crore, registering a 4.54% sequential increase, while total deposits climbed to ₹3,13,909.39 crore, up 5.41%.
Fee income remained a standout performer during the quarter, increasing by 10.54% sequentially to ₹990.92 crore, underlining the bank’s growing focus on non-interest income streams. Operating efficiency also improved significantly, with the cost-to-income ratio declining to 47.28%, a reduction of 665 basis points compared to the previous quarter.
Asset quality saw further strengthening, with Gross Non-Performing Assets (GNPA) and Net Non-Performing Assets (NNPA) falling to record lows of 1.62% and 0.20%, respectively. The Provision Coverage Ratio (excluding technical write-offs) improved to 87.07%, indicating stronger balance sheet resilience.
Return metrics also showed notable improvement, with Return on Assets (RoA) rising to 1.36% and Net Interest Margin (NIM) to 3.74%, both returning to pre-rate cut levels. Return on Equity (RoE) expanded to 13.69%, reflecting improved profitability and capital efficiency.
During the quarter, the bank also launched its in-house wealth management platform, marking a strategic expansion into wealth services and opening new avenues for customer engagement and fee-based income growth.
Commenting on the performance, Managing Director and CEO KVS Manian said the results reflect a strong operational quarter aligned with the bank’s long-term strategy. He highlighted the successful restructuring of liabilities, the achievement of crossing ₹1 lakh crore in both CASA and NR deposits, and the recovery of key return metrics as indicators of the bank’s strengthened foundation for future growth.
As part of its expansion strategy, Federal Bank added 39 new branches during the quarter. The network expansion is being guided by a data-driven approach, incorporating insights from external studies to enhance efficiency and impact.
Despite global geopolitical uncertainties, the bank maintained a balanced risk approach, enabling it to keep asset quality at decadal lows. The continued focus on selected high-growth segments is expected to provide resilience and support sustained performance in the coming quarters.
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