Banking
Federal Bank Q1 profit dips 15% to Rs 862 cr on higher provisions
Federal Bank's first-quarter net profit declined 15% to Rs 862 crore due to increased provisions for agriculture and microfinance slippages. While asset quality improved year-on-year, provisions rose to Rs 400 crore. The bank anticipates NIM to bottom out in the second quarter, aiming for stronger retail momentum and overall advance growth in the fiscal year.
Banks' credit growth to remain low as corporates using other funding sources in low interest rate regime: SBI Report
An SBI report indicates that bank credit growth is expected to remain subdued as corporations increasingly turn to alternative funding sources due to the current low-interest rate environment. This trend is evident in the declining share of bank credit in total resource flow, projected to fall to 22% by Q2 FY26. While overall credit growth stands at 9.
Centre may call IDBI bids in Q3
The Indian government anticipates inviting financial bids for IDBI Bank's strategic sale in the third quarter of FY26, aiming to finalize the winning bidder by fiscal year-end. Due diligence is complete, and consultations with interested parties are concluded. The government and LIC will jointly offload a 60.72% stake, potentially earning the government over ₹29,550 crore from its share.
India Post Payments Bank starts Aadhaar-based face authentication for digital banking
India Post Payments Bank has launched a nationwide Aadhaar-based face authentication for customer transactions, enhancing security and convenience, especially for elderly and differently-abled individuals. This feature, developed under UIDAI, allows banking transactions via facial recognition, eliminating the need for fingerprints or OTPs. It ensures financial inclusion by addressing limitations in biometric verification and enabling safe banking during health emergencies.
Due diligence for IDBI Bank stake sale done, financial bids expected in Q3: DIPAM Secy
The government anticipates inviting financial bids for IDBI Bank's disinvestment in the third quarter of the current fiscal year. The selection of the winning bidder is expected by the end of 2025-26. All preliminary processes are complete, and potential bidders have been granted access to the bank's financial and operational data.
Car loans race past housing loans in Q1, marking an unfamiliar turn for Indian banking
The dynamics of Indian banking just saw an unfamiliar development with car loans outpacing home loans in the first quarter of FY26. According to the Reserve Bank of India, banks have expanded their loan portfolios considerably, but the growth rate for home loans has decelerated, giving way to a surge in auto loans.
Bank lending slows down in June 2025
RBI data reveals a slowdown in bank lending across sectors in June 2025, with services and agriculture experiencing a more pronounced deceleration compared to retail and industry. Non-food bank credit grew by 10.2%, a significant drop from the previous year's 13.8%. While some industries like engineering and construction saw accelerated growth, personal loans also experienced moderation.
Bank credit growth to industry slows to 5.5% in June: RBI data
RBI data indicates a slowdown in bank credit growth to industry, reaching 5.5% in the fortnight ending June 26, compared to 7.7% the previous year. Non-food bank credit experienced a moderated growth of 10.2%. Certain sectors like MSMEs, engineering, construction, and textiles showed accelerated growth, while agriculture and services saw a deceleration. Personal loans also witnessed a slower growth rate.
IndusInd Bank announces exit of Internal Audit Head Jyoti Prasad Ratho
IndusInd Bank has made an announcement. Jyoti Prasad Ratho, previously the Head of Internal Audit, is no longer a part of the Senior Management Personnel. This change was announced on Wednesday. The bank has officially communicated Ratho's departure from the SMP. The bank is expected to announce a replacement soon.
RBI unlikely to re-introduce fixed-rate liquidity operations: Sources
The Reserve Bank of India is expected to maintain its stance on liquidity management. It will likely avoid reintroducing fixed-rate lending to banks. Banks have requested this facility to manage their funding needs better. The RBI prefers variable rate operations. A revised liquidity management framework may be unveiled on August 6.
Must Watch
PNB's Ashok Chandra sees 11-12% credit growth in FY26
Punjab National Bank anticipates credit growth of 11-12% in FY26, driven by a strong corporate loan book and increased disbursements. The bank's Q1 operating profit surged, fueled by treasury income and loan recoveries, despite a dip in net profit due to higher tax expenses. PNB plans to offload a 10% stake in Canara HSBC Life Insurance upon its listing.
Indian Overseas Bank engages an advisor to help sell over Rs 12k crore NPAs
The bank has engaged Navi Mumbai-based Special Situation Advisors India to find a buyer for 67 large corporate accounts within the next four months. These accounts include Videocon Industries, Frost International, Rotomac Global, Lanco Infratech and ABG Shipyard aggregating to a total outstanding exposure of more than Rs 12,224 crore for the bank, documents accessed by ET showed.
PNB to focus on project financing to revive business loan growth, CEO says
Punjab National Bank aims to boost business loan growth by focusing on infrastructure, smart metering, and renewable energy projects, according to CEO Ashok Chandra. Despite overall domestic loan growth of 9.6%, business loans only grew by 6.9% in the first quarter. PNB reported a net profit of 16.75 billion rupees, impacted by a one-time tax charge.
Public sector banks can transfer unclaimed shares, bond redemption amounts to IEPF from Aug 1
Amendments to the Banking Laws Act now allow PSBs to transfer unclaimed funds to the IEPF, aligning them with company practices. PSBs can now offer remuneration to statutory auditors, improving audit quality. The 'substantial interest' threshold increased to Rs 2 crore, and director tenures in cooperative banks extended to 10 years, effective April 1, 2025.
RBI warns banks, NBFCs not to bypass safeguards for growth
The Reserve Bank of India has cautioned banks and NBFCs against compromising internal controls and regulatory compliance in their pursuit of rapid expansion. RBI Deputy Governor Swaminathan J emphasized that some lenders are prioritizing short-term gains over sound practices, leading to increased supervisory interventions. He urged financial institutions to uphold ethical standards and implement adequate safeguards for digital tools.
ET Graphics: NPAs in MSME with PSBs
The Department of Financial Services (DFS) has urged banks to review penal charges for not maintaining Minimum Average Balance (MAB). This directive, as stated by MoS for finance Pankaj Chaudhary, prioritizes providing financial ease to customers, particularly those residing in semi-urban and rural regions. The aim is to alleviate the burden of these charges on a wider customer base.
BANKING STOCKS
NSEBSE
| Company Name | Latest | Change | %Change | Volume |
|---|---|---|---|---|
| HDFC Bank Ltd. | 2012.2 | -6 | -0.3 | 5658629 |
| ICICI Bank Ltd. | 1471.6 | -9.81 | -0.67 | 4416771 |
| State Bank of India | 794 | -2.55 | -0.33 | 15468370 |
| Kotak Mahindra Bank Ltd. | 1992.4 | 13.81 | 0.7 | 2672373 |
| Axis Bank Ltd. | 1062.4 | -6 | -0.57 | 5545442 |
