Bandhan Bank Q1 Results: Net Profit Slumps 65% YoY on Higher Provisions, NII Decline

Bandhan Bank on Friday reported a sharp 65 per cent year-on-year decline in net profit for the first quarter of FY26, impacted by elevated provisions and a dip in core income. Profit after tax fell to Rs 372 crore in the June quarter, compared to Rs 1,063 crore in the same period last year. However, net profit rose 17 per cent sequentially from Rs 318 crore in Q4 FY25. 

Net interest income (NII) — the bank’s core income — dropped 8 per cent year-on-year to Rs 2,757 crore in Q1 FY26, down from Rs 2,987 crore in the year-ago period. Total net income stood at Rs 3,483 crore, marginally lower than Rs 3,533 crore a year earlier. Operating profit also declined 14 per cent YoY to Rs 1,668 crore. 

Also read: Indian Overseas Bank Posts 76% Jump in Q1 Profit as NPAs Ease, NII Grows 12.5%

The earnings performance was dragged by a sharp rise in provisions and contingencies, which more than doubled to Rs 1,147 crore in Q1 FY26 from Rs 523 crore in Q1 FY25. Provisions, however, were slightly lower than the Rs 1,260 crore recorded in the previous quarter. 

Asset quality for the bank also weakened during the quarter. Gross non-performing assets (GNPA) rose to 5 per cent from 4.2 per cent in the same period last year and 4.7 per cent in the March quarter. Net NPA also edged up to 1.4 per cent, from 1.1 per cent a year ago and 1.3 per cent sequentially. The bank’s provision coverage ratio stood at 73.7 per cent, and 87.3 per cent including write-offs. 

Despite pressure on earnings, the lender saw robust traction in deposits, which increased by 16 per cent year-on-year to Rs 1.55 lakh crore. Retail term deposits grew 34 per cent, while the CASA ratio stood at 27.1 per cent, with CASA deposits at Rs 41,858 crore. 

Gross advances also increased by 6 per cent YoY to Rs 1.34 lakh crore. Within this, the retail (non-housing) book surged 78 per cent, wholesale banking grew 32 per cent, and housing loans increased 15 per cent. 

Also read: Axis Bank Q1 Results: Net Profit Declines 4% YoY; Gross NPA at 1.57%

“Bandhan Bank has delivered a sequentially improving performance in Q1 FY26, marked by strong growth in deposits and continued momentum in Retail & Wholesale banking. While the operating environment poses certain challenges, our performance reflects the underlying resilience of our business and the strength of our strategic direction. We remain focused on prudent risk management, operational efficiency, and delivering long-term value for our customers and stakeholders,” said Partha Pratim Sengupta, MD and CEO, Bandhan Bank. 

The bank’s capital adequacy ratio remained strong at 19.4 per cent, well above the regulatory minimum of 11.5 per cent.