Bandhan Bank Q4 Results: Profit up 68% YoY to Rs. 530 crores; NII rose marginally

Bandhan Bank reported a sharp recovery in profitability for the March quarter, with net profit rising 68% year-on-year to Rs. 530 crore, supported by lower provisions and improvement in asset quality. Net Interest Income (NII) grew marginally by 1% to Rs. 2,800 crore, while total revenue rose 3% to Rs. 3,570 crore, indicating a steady but muted topline performance.

The lender’s operating profit fell 8.3% year-on-year to Rs. 1,440 crore, reflecting higher operating expenses, which rose nearly 13% during the quarter. However, a sharp decline in provisions – over 46% YoY – helped boost bottom-line growth significantly.

On a sequential basis, profit rose 159% QoQ, highlighting normalization after a weak December quarter.

Asset quality continued to improve, with gross non-performing assets (GNPA) ratio declining to 3.3% from 4.7% a year ago, while net NPA stood at 1.0%. Credit costs fell sharply to 2.0%, down 195 basis points, reflecting better recovery and tighter underwriting.

The bank’s loan book remained on a growth path, with gross advances growing 12.6% year-on-year to Rs. 1.54 lakh crores. Deposits increased by 10% year-on-year to Rs. 1.66 lakh crore, though the CASA ratio fell to 29.3%, indicating some pressure on low-cost deposits.

Retail deposits showed strong traction, registering 17.7% year-on-year growth, underscoring the bank’s ongoing shift towards a more granular liability franchise. Meanwhile, the mix of secured loans improved to 56.2%, highlighting a calibrated move towards lower risk assets.

Margins remained under pressure, with net interest margin (NIM) falling 46 basis points YoY to 6.2%, though it improved sequentially. Return ratios, however, showed improvement with return on assets (RoA) at 1.1% and return on equity (RoE) at 8.5%, both expanding meaningfully from a year ago.

For the full year of FY26, Bandhan Bank reported a sharp 55% drop in profit, reflecting elevated stress and provisioning during the previous quarter, even as Q4 performance signaled a turnaround.

Operationally, the bank continued to diversify its portfolio beyond its traditional microfinance base, with non-EEB (Emerging Entrepreneurs Business) loans growing at around 25% annually and now making up a large portion of the book.

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The quarter also saw continued improvement in collection efficiency and borrower behavior, with over 96% of customers classified as fully paid, indicating stability in asset quality trends.

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