• Financial turnaround: ESAF Small Finance Bank turned around from a loss of ₹81 crore in Q1 FY26 to an ₹80 crore profit in Q1 FY27, driven by 33% asset growth and a surge in net interest margin to 7.9% (₹584 crore).
• Asset quality improvement: Net NPA dropped to 0.8%, with legacy NPA stock at ₹185 crore and collection efficiency on new micro loans since 2025 reaching 99%.
• Return on assets: Management remains confident in achieving its 2% ROA target alongside minimal credit costs and reduced provisioning requirements in the coming quarters.
• Deposit stability: Retail deposits comprise 91% of the total base, with NR deposits contributing close to 24%, keeping funding costs stable and reliance on bulk deposits minimal.
• Portfolio diversification: The bank's secured "MARG" (MSME, retail, agri, gold) segment now makes up 62% of assets, with plans to further reduce the unsecured microfinance share to 30% over the next 2 to 3 years.