Equitas Small Finance Bank Reports Q1 FY26 Results

Equitas Small Finance Bank (ESFB) has announced its unaudited financial results for the quarter that ended on June 30, 2025. The Board of Directors approved these results at a meeting held on August 8, 2025.

Financial Performance and Key Ratios

The bank experienced a mixed performance, with several areas showing growth while a one-time provision impacted profitability.

Deposits and Advances: Overall deposits saw an 18% year-over-year (YoY) increase and a 3% quarter-over-quarter (QoQ) increase. Retail Term Deposits grew by 20% YoY, reaching Rs 19,354 Crs. Gross advances grew by 8% YoY but were flat QoQ due to a contraction in the microfinance loan book. Non-Microfinance advances grew by 18% YoY. The bank's secured loan advances make up 91% of its total advances.

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Profitability: The bank reported a loss of Rs 224 Crs for the quarter. This was primarily due to a one-time additional provision of Rs 330 Crs. This provision included Rs 185 Crs for additional standard asset provisions in microfinance and Rs 145 Crs for additional NPA provisions due to changes in provisioning norms. The bank's Net Interest Margin (NIM) for the quarter was 6.55% , and the Cost to Income ratio was 70.62%.

Capital and Asset Quality: As of June 30, 2025, the bank's total Capital to Risk-Weighted Assets Ratio (CRAR) was 20.48% , with Tier I capital at 17.16% and Tier II at 3.32%. The Net Worth of the bank stands at Rs 5,849 Crs. The bank's asset quality improved, with Gross Non-Performing Assets (GNPA) improving to 2.82% from 2.89% QoQ, and Net Non-Performing Assets (NNPA) improving to 0.95% from 0.98% QoQ.

Business Highlights
ESFB's business performance was driven by growth in its key portfolios.

Vehicle Finance: The bank's Vehicle Finance portfolio surpassed Rs 9,500 Crs during the quarter. Specifically, Used Car advances grew by 50% YoY, crossing Rs 2,000 Crs, and Used Commercial Vehicle (CV) advances grew by 26% YoY.

CASA and Liquidity: The Current Account Savings Account (CASA) ratio remained stable at 29%, with Current Account (CA) balances increasing by 92% YoY. The bank's Liquidity Coverage Ratio (LCR) was 209.5% as of June 30, 2025. The bank’s Certificate of Deposit (CD) program holds the highest rating of A1+ from India Ratings, CareEdge Ratings, and CRISIL