# 1. Financial Performance ## A. Key Figures * **Net Interest Income (NII):** **₹6,461 Cr** Q3FY26 (+6%) · **₹6,070 Cr** Q3FY25 * **Non-Interest Income:** **₹2,279 Cr** Q3FY26 (+30%) · **₹1,747 Cr** Q3FY25 * **Operating Profit:** **₹4,193 Cr** Q3FY26 (+13%) · **₹3,703 Cr** Q3FY25 * **Net Profit:** **₹2,705 Cr** Q3FY26 (+7%) · **₹2,517 Cr** Q3FY25 * Net Interest Margin (NIM): 2.57% Dec'25 (+16 bps) · 2.41% Sep'25 * **9M Net Profit:** **₹7,500 Cr** FY26 · **~₹10,000 Cr** expected full-year * CRAR: 17.09% as of Dec 31, 2025 ## B. Revenue Growth * **Exceptional Global Expansion:** Global business surged on strong credit and deposit momentum, with robust double-digit growth across geographies. * **Diversified Income Growth:** Non-interest income outpaced NII with strong double-digit expansion, signaling enhanced fee-based revenue resilience. * **Sustained Domestic Momentum:** Domestic credit growth exceeds 15%, supported by balanced quarterly expansion in deposits and credit. ## C. Profit Margins * **Margin Enhancement:** Strategic asset-liability management drove a notable sequential improvement in NIM, despite cost pressures. * **Targeted Margin Uplift:** **Gold loan margins doubled to 25%**, reflecting pricing power and portfolio optimization in high-yield segments. * **Profitability Leverage:** Operating profit growth outpaced net profit, indicating solid operating leverage despite tax or provisioning headwinds. ## D. Balance Sheet * **Strong Capital Position:** CRAR improved to a healthy **10.9%**, providing adequate buffer for growth and risk absorption. --- # 2. Loan Book & Asset Quality ## A. Key Figures * **Gross Advances:** **₹7,40,314 Cr** (Dec'25) (+63% YoY) · **₹6,51,507 Cr** (Dec'24) * **Provision Coverage Ratio (PCR):** **93.60%** (Dec'25) (+112 bps YoY) * Slippage Ratio: **0.16%** (Dec'25) (–30 bps YoY) ## B. Loan Growth & Credit Pipeline * **Robust Loan Expansion:** Record annual advance growth driven by strong corporate and retail demand, with **₹88,000 crore** added in the year. * **Significant Forward Pipeline:** Credit pipeline of **₹80,000 crore**, including **₹65,000 crore** in corporate sanctions, to be disbursed over Q4 FY26 and Q1 FY27. * **Rate Sensitivity:** 64% of portfolio linked to EBLR; yield pressure from **125 bps** cumulative repo rate cuts in 2025, including a **25 bps** cut in December. ## C. Asset Quality Trends * **Strong Improvement in Asset Quality:** Sustained reduction in gross and net NPAs, supported by higher provisioning and effective recovery mechanisms. * **Gold Loan Resilience:** Gold loan NPAs pose minimal risk due to rapid recovery within **30 days** via pledged collateral liquidation. * **Sectoral Slippage Focus:** Recent slippages concentrated in MSME, Agriculture, and Retail; one-off corporate road project NPA in consortium lending. * **Management Confidence:** MD & CEO downplays routine slippages as non-concerning; emphasis on proactive monitoring to contain future risks. --- # 3. Deposit & Funding Mix ## A. Key Figures * Domestic Deposits: ₹7.65 L Cr (+12.8%) * Global Deposits: ₹8.87 Lakh Cr (+11.64%) · Incremental Growth: ₹92,500 Cr * CASA Ratio: 37.97% * **Bulk Deposits:** 15% of total deposits * **Retail Term Deposits Growth:** +14% YoY ## B. CASA Trends & Structural Shifts * **Resilient Core CASA Franchise:** Despite system-wide CASA pressures, the bank maintained a **97% CASA ratio** amid strong absolute growth, outperforming sector trends. * **Sector-Wide CASA Pressure:** Systemic decline in CASA growth driven by **structural shift in depositor behavior** toward alternative investments including equities, real estate, gold, and NPS. * **Funding Mix Adaptation:** Banks increasingly relying on retail term and bulk deposits to offset slowing CASA growth, especially as credit demand outpaces low-cost deposit expansion. ## C. Bulk Deposit Dynamics * **Strategic Use of Bulk Funding:** Bulk deposits account for **15% of total deposits**, with flexible pricing based on size, tenure, and counterparty—sourced from governments, PSUs, corporates, and financial institutions. * **Short-Term Bulk Deposits Lower Funding Costs:** Inclusion of **short-tenure bulk deposits (7–15 days)** from government entities reduces weighted average cost, making bulk funding cheaper than retail term deposits despite common assumptions. ## D. Cost of Funds Outlook * **Declining Deposit Costs Expected:** Ongoing re-pricing of term deposits at lower rates—following cuts in savings and FD rates—positions the bank for **lower overall cost of funds** in coming quarters. --- # 4. Segment & Product Performance ## A. Key Figures * Domestic Gross Advances: ₹6.29 Lakh Cr (+15.16%) · RAM Advances: ₹3.68 Lakh Cr (+18.05%) (58.54% of total) * **Credit Growth:** Retail +20% · Agriculture +16% · MSME +15% · Corporate ~11% * **Gold Loan Portfolio:** ₹47,000 Cr (NPA: ₹70–75 Cr) * **International Advances:** ₹1,10,000 Cr (15% of ₹7,40,000 Cr global book) ## B. RAM Advances * **Strategic Portfolio Shift:** Accelerated pivot toward RAM segment, reducing low-yielding exposures (e.g., NABARD, SIDBI, HFCs) with yields of **6–25%**, to improve NIMs and credit diversification. * **Growth Runway:** RAM book expansion supported by revised MSME definition (turnover up to ₹500 Cr), favorable rural/urban income trends, and targeted lending in food processing and allied agriculture. * **Lending Structure & Targets:** Medium enterprise loans average **₹200 Cr** (50% working capital, 50% term loans), with machinery loans >**₹125 Cr**; bank aims to lift RAM share to **65% by FY31** (from 54%) under BOI at 125 plan. * **Total Business Target:** ₹31 Lakh Cr under BOI at 125, with RAM as primary growth engine due to higher yields and better asset quality. ## C. Gold Loans * **High-Yield, Low-Risk Segment:** Gold loan book delivers **~9% yield** with minimal NPAs, reflecting strong collateral coverage and efficient recovery mechanisms. ## D. Gig & Farm Loans * **New Market Expansion:** Launched targeted schemes—**BOI Surya Shakti** for solar and agro-processing, and **Gig Worker Loans** (Star Gig Grow, GIG GearUP) for eShram-registered workers—though expected volumes remain **very small**. * **Product Design:** Gig loans capped at **₹2 Lacs (individuals)** and **₹5 Lacs (SMEs)** with interest rates of **5%**, repayable over **2–5 years**; farm mechanization loans start at **₹4–5 Lacs**, up to **₹35–50 Lacs**. ## E. Credit Cards * **Premium & Inclusive Offerings:** Launched **Celestia RuPay Platinum Metal Card** with SBMD for affluent customers and **RuPay Women’s Credit Card** to capture niche segments, signaling focus on differentiated retail products. --- # 5. Branch & Digital Expansion ## A. Key Figures * **Branches Opened:** **211** in FY25 · **145+** opened in FY26 (of 200 approved) · **50–55** to open this quarter * **Total Future Branch Pipeline:** **600** branches approved across FY25–FY27 (including FY27’s **200** approved) * **IT Opex Allocation:** **10%** of total operating expenses dedicated to IT Opex, plus additional IT Capex * **Automation Impact:** **50,000 man hours** saved in back-office operations in 9MFY26 ## B. Branch Network * **Aggressive Pan-India Rollout:** Sustained, geographically balanced expansion across all regions with no bias, supported by 13 FGM offices and 69 Zones. * **Clear Execution Trajectory:** High pace of branch openings with strong board-level commitment, signaling confidence in distribution-led growth. ## C. Digital Journeys * **Real-Time Clearing Live:** CTS Continuous Clearing now active, enabling faster, near real-time cheque processing for all customers. * **AI-Driven Transformation:** Project Star Aditya leverages **AI, ML, and GenAI** to enhance lead generation, underwriting, and risk monitoring across business units. * **Digital Service Expansion:** New digital journeys being rolled out in loan, liability, and wealth management, underpinned by modernization of IT and cybersecurity infrastructure. ## D. IT Opex & Capex * **Sustained Digital Investment:** Double-digit percentage of Opex allocated to IT, complemented by dedicated Capex, reflecting strategic prioritization of tech resilience and innovation. ## E. Automation Gains * **Material Efficiency Gains:** Large-scale automation in credit sanctions and controls has driven significant back-office productivity improvements. --- # 6. Credit & Asset Risks ## A. Key Figures * **SMA Total:** **₹5,400 Cr** (down from ₹6,200 Cr) · **75% of standard loan book** * **SMA-2 Accounts:** **₹4,120 Cr** (up from ₹2,020 Cr) * **Govt-Guaranteed SMA Exposure:** **₹3,500 Cr** of total SMA book * **ECL Impact on CRAR:** **~2%** total (~₹9,400–10,000 Cr) · **annual drag of ~40 bps** over five years ## B. SMA Migration * **Targeted Risk Reduction:** LTV ratio for gold loans cut to **75%** amid rising gold prices to mitigate valuation risk. * **SMA Deterioration Driven by Govt Accounts:** Sharp rise in SMA-2 accounts largely attributable to **three large State Government-guaranteed loans** rolling into higher risk categories. * **Core Segments Remain Resilient:** Excluding government exposures, SMA levels in **retail, agriculture, and MSME segments are stable**, indicating sound underlying asset quality. * **SME Book Improving:** SME portfolio shows positive momentum with reduction in large SMA accounts and **no expected further asset quality slippage**. ## C. ECL Implementation * **Regulatory Headwinds Quantified:** Full ECL implementation to reduce CRAR by ~2%, a significantly higher impact than prior estimates, though **phased over five years** and deemed manageable. * **Systemic Strengthening:** Adoption of ECL, Basel III revisions, and risk-based deposit insurance reflect broader regulatory push to enhance sector-wide resilience. ## D. Geopolitical Exposure * **Cautious International Stance:** Credit growth abroad muted due to geopolitical tensions; selective approach maintained with focus on **Indian corporates overseas** versus new overseas corporate clients. --- # 7. Guidance & Outlook ## A. Key Figures * NIM: 2.57% Q3 FY26 (+16 bps seq) · ~2.60% projected Q4 FY26 * **Credit Cost:** **34%** FY26 (-500 bps YoY) * Slippage Ratio: 0.16% in Q3FY26 (-30 bps YoY) * **Recovery:** **₹5,300 Cr** 9M FY26 · **₹2,000 Cr** projected Q4 · **₹7,200–7,300 Cr** estimated full-year * **Written-off Book:** **₹50,000 Cr** outstanding · **₹750 Cr/qtr** recovery target (next four quarters) * **Growth Guidance:** **13–14%** global advances · **11–12%** global deposits (FY26) ## B. NIM Projections * **Margin Expansion Trajectory:** NIM improved sequentially and is projected to rise further, driven by active yield enhancement through **higher-yielding AA/AAA-rated advances** and portfolio rebalancing. * **Yield Management:** Despite sector-wide pressure, the bank lifted yields in recent months by replacing low-return loans, capturing **20–40 bps incremental returns** on new flows. * **Funding Mix Headwinds:** Current **50-50 retail-wholesale funding ratio** constrains NIM upside relative to peers targeting **60-40+ retail share**, posing a structural challenge to sustaining elevated margins. * **Rate Outlook:** No immediate rate cuts expected despite prior easing; **medium-term stability** anticipated, supporting NIM resilience over the near horizon. ## C. Recovery Goals * **Accelerated Recovery Push:** Full-year recovery set to reach **₹7,300 Cr**, with management targeting a near-doubling of the run rate to **₹750 Cr per quarter** over the next year. * **Large Written-off Book:** Significant recovery opportunity remains within the **₹50,000 Cr** legacy written-off portfolio, now a strategic focus area for value unlock. ## D. Strategic Priorities * **Growth Above Guidance Likely:** Strong credit pipeline positions the bank to exceed its **13–14% advances growth** target in Q4 and early next fiscal. * **Balanced Expansion:** Calibrated credit growth paired with **IT investments and partnerships** to drive efficiency, risk discipline, and low-cost deposit mobilization.