Dhanlaxmi Bank's profit doubled to 24 million rupees, revenue grew to 484 million rupees in the first quarter of the fiscal year 2027

The public sector bank Canara reported a year-on-year growth in net profit of 2.19%, reaching 4,856 crore rupees in the first quarter of fiscal year 27. This figure is higher than 4,752 crore rupees the previous year, which occurred amid a decline in non-interest income.

Quarterly Financial Performance

Compared to the previous quarter in March, net profit increased by 7.77%, amounting to 4,506 crore rupees. Meanwhile, Net Interest Income (NII) grew by 13.39% year-on-year, reaching 10,215 crore rupees compared to 9,009 crore rupees.

Non-interest income decreased by 4.72% year-on-year to 6,727 crore rupees, driven by a sharp drop in treasury income. However, fee-based income increased by 5.35% to 2,342 crore rupees, and write-off recoveries rose by 19.05% to 1,381 crore rupees.

Interest Rate and Deposit Dynamics

Treasury income fell by 46.96% year-on-year to 1,057 crore rupees. The bank's Net Interest Margin (NIM) stood at 2.52% for the June quarter, showing almost no change from 2.55% the previous year and slightly exceeding the previous quarter's 2.51%. Deposit costs decreased to 5.27% from 5.74% a year ago, while loan yields moderately declined to 8.00% from 8.47%.

Foreign Currency Mobilization Program

Managing Director and CEO Brajesh Kumar Singh stated that the bank has already mobilized $775 million (approximately 7,300 crore rupees) under the FCNR(B) mobilization and expects the inflow to reach about 14,000 crore rupees. He noted that the bank plans to replace at least 10,000 crore rupees of expensive bulk deposits with FCNR(B) deposits over the next year. The bank offers up to nine times leverage for eligible customers, with most inflows expected from the Middle East, which already accounts for about 68% of the FCNR(B) deposit base.

Singh emphasized that the goal of this initiative is to support the inflow of dollars into the country, stating that banks are participating in the scheme 'not for profit'. He added that this is being done to address the country's current account and capital deficit issue.

Asset Quality and Business Metrics

Total provisions remained almost unchanged at 3,780 crore rupees compared to 3,802 crore rupees a year ago, but they increased by 67.85% compared to 2,252 crore rupees in March. Provisions for Non-Performing Assets (NPAs) decreased by 24.17% year-on-year to 1,399 crore rupees, while tax provisions rose by 17.24% to 1,700 crore rupees.

Regarding asset quality, the Gross NPA ratio improved to 1.57% from 2.69% a year ago and 1.84% in the previous quarter. The Net NPA ratio decreased to 0.36% from 0.63% a year ago and 0.43% in March.

In terms of business, global loans grew by 17.97% year-on-year to 12.93 trillion rupees, and global deposits increased by 11.63% to 16.12 trillion rupees, bringing the total business volume to 29.05 trillion rupees, which is 14.37% more than the previous year. The ratio of global loans to deposits improved to 80.25% from 75.93% a year ago.

The Retail, Agricultural, and MSME (RAM) portfolio grew by 21.20% year-on-year to 7.65 trillion rupees and accounted for 59% of domestic lending. Retail loans increased by 35.88%, housing loans by 17.85%, and MSME loans by 15.12%. Current Account and Savings Account (CASA) deposits in the country constituted 29.7% of total deposits.

Punjab National Bank (PNB) reported a significant increase in net profit for the June quarter, exceeding threefold, due to improved asset quality and growth in operating profit, despite total income remaining virtually unchanged.

Quarterly Financial Results

The public sector bank PNB reported an increase in standalone net profit to 5,253 crore rupees for the quarter ending June 30, 2026. In the same period last year, the net profit was 1,675 crore rupees. According to regulatory filings, total income in the quarter under review remained stable at 37,231 crore rupees.

Income and Operations

The bank's interest income slightly increased to 32,897 crore rupees compared to 31,964 crore rupees in the same quarter a year earlier. The bank's operating profit grew to 7,519 crore rupees, whereas it was 7,081 crore rupees a year earlier.

Asset Quality Improvement

The bank's asset quality improved: gross non-performing assets (NPA) decreased to 2.78 percent of gross loans as of the end of the quarter, compared to 3.78 percent a year earlier. The absolute decrease in gross non-performing assets (GNPA) was 7,292 crore rupees, bringing them down to 35,381 crore rupees from 42,673 crore rupees. Net non-performing assets (NNPA) decreased by 699 crore rupees, reaching 3,433 crore rupees from 4,132 crore rupees as of June 2025.

Reserves and Capital Adequacy

Similarly, net NPAs, or bad loans, decreased to 0.26 percent compared to 0.38 percent in the previous year. Nevertheless, provisions for bad loans increased to 792 crore rupees in the first quarter, compared to 396 crore rupees for the same period a year earlier. The bank's capital adequacy ratio improved to 18.13 percent from 17.5 percent at the end of the first quarter of the previous fiscal year.

Federal Bank announced a significant year-on-year increase in net profit by 37%, reaching ₹1,177 crore for the quarter covering April-June 2027 (Q1FY27). This growth was driven by a steady increase in Net Interest Income (NII), an expansion in Net Interest Margin (NIM), and a reduction in new write-offs.

Quarterly Financial Performance

However, looking at sequential data, net profit decreased by 7%. Nevertheless, excluding the one-time income received in March, the bank stated that this is its highest quarterly profit in history. Net Interest Income (NII) increased by 26% year-over-year to ₹2,946 crore, supported by healthy credit growth and margin expansion.

Margin and Asset Quality

The bank's Net Interest Margin (NIM) grew by 39 basis points (bps) year-on-year to 3.33%, as the cost of funding fell faster than asset yields. The cost of funding decreased by 60 bps, while asset yield contracted by 44 bps. The cost of deposits dropped by 57 bps year-on-year to 5.21%. Other income declined by 6% year-on-year and by 8% compared to the previous quarter, amounting to ₹1,048 crore.

Asset quality improved during the reporting period. Gross Non-Performing Assets (GNPAs) reduced to 1.52% of gross loans as of the end of June, compared to 1.62% at the end of March. Net NPAs almost halved, reaching 0.18%, which is the lowest figure in the bank's recent history. New write-offs slowed to ₹409 crore in the quarter compared to ₹474 crore in Q4FY26 and ₹658 crore a year earlier. Provisions increased by 4% year-on-year to ₹720 crore but decreased by 29% sequentially.

Business Growth and Deposit Base

In the business segment, gross loans grew by nearly 15% year-on-year to ₹2.81 trillion. The growth was supported by commercial banking (23%), gold loans (33%), real estate mortgage loans (21%), credit cards (36%), and financing for commercial transport and construction equipment (21%). The bank's corporate and institutional banking portfolio exceeded ₹1 trillion during the quarter, with total business volume reaching nearly ₹6 trillion.

Total deposits rose to ₹3.20 trillion. CASA deposits increased by 18.3% year-on-year to ₹1.03 trillion, outpacing overall deposit growth and raising the CASA ratio by 188 bps to 32.23%. The bank's franchise for Non-Resident (NR) deposits also remained strong: NRE and ONR deposits grew by 14.2% year-on-year to ₹1.05 trillion, continuing to grow after crossing the ₹1 trillion mark in the previous quarter.

Management Comments

Mr. Manian, Managing Director and CEO of Federal Bank, noted that the profit grew by almost 37% during a period when the treasury faced a challenging quarter, indicating that income is being generated by core business rather than market acquisitions. He emphasized that the 26% rise in NII alongside a 15% growth in loans reflects the bank's focus on margin expansion.

Manian also stated that the Net NPA ratio of 0.18% is the lowest in the bank's recent history, and the provisioning coverage ratio stands at 87%. He added that the bank is building a sustainable balance through reduced credit costs and a strong income buffer. Management noted that the selected lending segments continue to perform well, and the CASA and non-resident deposit franchises are deepening, placing the bank in a favorable position for the remainder of the fiscal year due to strong capital, improved asset quality, and a healthy business momentum.