Bandhan Bank Q1 profit jumps 35% as lower provisions and better asset quality boost earnings

Kolkata-based private lender Bandhan Bank Ltd on Tuesday (July 21) reported a 34.8% year-on-year increase in net profit to ₹501.6 crore for the first quarter, compared with ₹372 crore in the year-ago period.

The bank's Net Interest Income (NII) rose 6% year-on-year to ₹2,921 crore, from ₹2,757 crore in the corresponding quarter last year. The bank's net interest margin (NIM) stood at 6.2% during the quarter, remaining flat sequentially.

Asset quality improved sequentially, with gross non-performing assets (GNPA) declining to ₹4,881 crore from ₹5,019.5 crore in the previous quarter. Net non-performing assets (NNPA) fell to ₹1,412 crore from ₹1,452 crore quarter-on-quarter.

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The gross NPA ratio improved to 3.15% in Q1 from 3.27% in the previous quarter, while the net NPA ratio declined to 0.93% from 0.97% quarter-on-quarter. Provisions stood at ₹682.5 crore during the quarter, compared with ₹677 crore in the previous quarter and ₹1,147 crore in the year-ago period.

The bank's net revenue stood at ₹3,524 crore in Q1 FY27, compared with ₹3,483 crore in Q1 FY26, registering a growth of 1.2% year-on-year.

Advances

Bandhan Bank's gross advances grew 16% year-on-year to ₹1.56 lakh crore as of June 30, 2026, compared with ₹1.34 lakh crore a year ago. The secured advances grew 27% year-on-year and accounted for nearly 57% of the total loan book.

The retail book, excluding housing, increased 45% year-on-year, while wholesale banking advances grew 38%. The housing book registered a 6% growth during the period.

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Deposits

The bank's total deposits increased 7% year-on-year to ₹1.65 lakh crore as of June 30, 2026, compared with ₹1.55 lakh crore in the previous year.

Retail deposits, including current account savings account (CASA) and retail term deposits, rose 16%, with retail deposits accounting for 74% of total deposits. CASA deposits stood at ₹48,479 crore, while the CASA ratio remained above 29%.

Asset quality

The bank's gross non-performing assets (GNPA) stood at 3.1% and net non-performing assets (NNPA) at 0.9% in Q1 FY27, improving from 3.3% and 1.0%, respectively, in Q4 FY26.

The collection efficiency for emerging entrepreneurs business (EEB) loans remained flat at 98.5% during the quarter. The provision coverage ratio, including technical write-offs, stood at 85.9% as of June 30, 2026. Provisions, excluding tax, stood at ₹683 crore for the quarter, down 40% year-on-year.

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Returns and network

Bandhan Bank's return on assets (RoA) stood at 1.0%, while return on equity (RoE) was at 7.7% for Q1 FY27. The bank's distribution network spans nearly 6,400 outlets, with more than 74,500 employees.

Partha Pratim Sengupta, MD & CEO, said, "Our Q1 FY2026-27 performance reflects the resilience of Bandhan Bank’s franchise, the commitment of our teams, and the trust our stakeholders continue to place in us. As we build on this momentum, we remain focused on delivering customer-centric and digitally enabled growth.

By strengthening our distribution network, expanding our product offerings, and harnessing data-driven insights, we are well positioned to create greater value for our customers and stakeholders while driving sustainable, balanced, and future-ready growth."

Shares of Bandhan Bank Ltd ended at ₹208.60, down by ₹2.75, or 1.30%, on the BSE.