Federal Bank has delivered record-breaking performance with all-time high Net Interest Income (NII) and fee income, reflecting strong, broad-based growth across key financial metrics.
For the second quarter of FY26, the Bank’s NII reached an all-time high of Rs 2,495 crore, supported by stable margins, while fee income soared to a record Rs 886 crore. The Current Account Savings Account (CASA) ratio advanced to 31.01 per cent, a year-on-year increase of 94 basis points. CASA deposits stood at Rs 89,591 crore, representing an annual rise of 10.71 per cent.
Operating profit came in at Rs 1,644.17 crore, an increase of 5.65 per cent compared to the previous quarter, whereas net profit rose by 10.85 per cent quarter-on-quarter to Rs 955.26 crore. The improvement was driven by enhanced operating income and prudent expense control. The Bank’s return on assets (ROA) and return on equity (ROE) stood at 1.09 per cent and 11.01 per cent, respectively. The net interest margin improved by 12 basis points during the quarter to 3.06 per cent.
The Bank recorded total deposits of Rs 288,919.58 crore, marking a 7.36 per cent increase year-on-year, while net advances grew by 6.23 per cent to Rs 244,657.06 crore, demonstrating steady, well-balanced growth. The Bank’s asset quality remained among the best in the industry, with Gross NPA (GNPA) at 1.83 per cent and Net NPA at 0.48 per cent. The Capital to Risk Weighted Assets Ratio (CRAR) was robust at 15.71 per cent, with a healthy Provision Coverage Ratio of 73.45 per cent.
Commenting on the results, KVS Manian, Managing Director and Chief Executive Officer, Federal Bank, remarked, “After more than a year in this position, I am deeply confident about the Bank’s current standing and the strategic path ahead. Over the past several quarters, we have implemented key initiatives that reinforce our fundamentals and position us for the future. Our CASA base continues to expand meaningfully, supported by customer faith and consistent delivery by our team.”
He further added that the Bank has been diversifying its asset mix carefully, boosting exposure in the mid-yield portfolio to optimise returns. Fee-based income has sustained double-digit sequential growth, underlining the stability and depth of the earnings base. KVS Manian emphasised the Bank’s commitment to disciplined risk management and its focus on sustainable development underpinned by its core values.
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