Federal Bank reported a record Q3 FY26, driven by strong NII, operating profit, and fee income. Net profit stood at ₹1,041.21 crore, up 9% QoQ. The bank saw improved margins, reduced funding costs, and strengthened asset quality. NII grew to ₹2,652.73 crore, up 6.31% QoQ and 9.11% YoY. The bank’s performance reflects a focus on building a stable, margin-led franchise.
Financial Performance Highlights
Federal Bank announced a strong performance for the quarter ended December 31, 2025 (Q3 FY26). Key highlights include:
- Net Profit: Stood at ₹1,041.21 crore, an increase of 9% QoQ.
- Net Interest Income (NII): Increased to ₹2,652.73 crore, up by 6.31% QoQ and 9.11% YoY.
- Net Interest Margin (NIM): Expanded by 12 bps QoQ to 3.18%.
The bank achieved all-time highs in NII, operating profit, and fee income, demonstrating strong core earnings momentum.
Asset Quality and Business Growth
- Total Business: Reached ₹5,53,364.49 crore, a growth of 3.71% QoQ and 11.40% YoY.
- Advances: Rose to ₹2,55,568.67 crore, up 4.46% QoQ and 10.94% YoY.
- Deposits: Increased to ₹2,97,795.82 crore, with a growth of 3.07% QoQ and 11.80% YoY.
Asset quality also improved significantly:
- Gross NPA: Stood at 1.72%.
- Net NPA: Reached 0.42%.
Key Ratios and Operational Efficiency
- CASA Ratio: Improved to 32.07%, up 106 bps QoQ and 191 bps YoY.
- Fee Income: Stood at ₹896.47 crore, growing by 18.57% YoY.
- Cost-to-income ratio: Improved to 53.92%.
- Provision Coverage Ratio (excluding TWO): Improved to 75.14%.
- ROA: Improved to 1.15%.
- ROE: Reached 11.68%.
- Earnings per share (EPS): Stood at ₹16.79 for the quarter, up by 8.89% QoQ.
Strategic Developments
Federal Bank increased its stake in Ageas Federal Life Insurance Company from 26% to 30%. The transaction, completed in November 2025, involved the acquisition of 3.2 crore shares.
Source: BSE
