Bandhan Bank Stock Price Down by More Than 3% Today After Decline in CASA Deposits

4 July 2025 – On Friday, Bandhan Bank’s shares fell by more than 3% trading at 177.44 after the bank said that its low-cost deposit base had dropped  in the first quarter of FY26. This raised concerns about the bank’s funding mix and profitability. The bank’s CASA (Current Account Savings Account) ratio dropped a lot from 33.37% in Q1 FY25 and 31.37% in the preceding quarter to 27.06% in June 2025. Total deposits rose 16.1% year-on-year to ₹1.55 lakh crore, mostly because retail term deposits rose 33.6%. However, CASA deposits fell 5.8% year-on-year and 11.8% sequentially. This change from low-cost to higher-cost deposits could make funds more expensive and lower net interest margins.

At 1 p.m. 4th July, the stock is down by 3.19% at Rs 178.07 per share.

Stock Reaction and Market Context

Bandhan Bank’s stock fell as much as 3.5% intraday to ₹177.44, marking its steepest fall since May 20, before recovering slightly to trade 1.7% lower at ₹180.8 around 11:20 AM. This movement came amid a muted session for the broader market, with the Nifty 50 edging up by just 0.03%.

Despite the day’s fall, Bandhan Bank shares have gained 13% so far in 2025, outperforming the Nifty 50 index which is up 7.5% year-to-date. The stock was trading at 1.5 times its average 30-day trading volume, indicating strong investor reaction. The bank’s total market capitalisation stood at ₹29,029.70 crore.

Key Q1 FY26 Highlights

In its Q1 business update, Bandhan Bank reported a sharp decline in its CASA (Current Account Savings Account) ratio, which fell to 27.06% from 33.37% a year earlier and 31.37% in Q4 FY25. CASA deposits dropped 5.8% year-on-year to ₹41,859 crore and fell 11.8% sequentially.

This decline was partially offset by a 33.6% year-on-year surge in retail term deposits, which stood at ₹63,658 crore. Overall, total deposits grew 16.1% on-year to ₹1.54 lakh crore, driven in part by a 19.6% rise in bulk deposits to ₹49,147 crore. Retail deposits, including CASA, rose 14.6% to ₹1.05 lakh crore, forming 68.22% of the total deposit base. Analysts will closely watch the bank’s efforts to improve CASA mobilization and manage funding costs in the coming quarters.

Loan Book Performance

The bank’s loans and advances stood at ₹1.33 lakh crore as of June 30, 2025, registering a 6.4% year-on-year increase. However, on a sequential basis, this represented a 2.5% decline from the March 2025 quarter.

In the fourth quarter of FY25, Bandhan Bank said it had loans and advances of ₹1.38 lakh crore, which was a 10.6% increase from the same time the year before. For that quarter, CASA deposits were ₹47,436 crore, which is less than the ₹50,151 crore they were a year before. The CASA ratio was 31.4% at that point, down from 37.1% the year before.

Conclusion:

The steep reduction in CASA deposits in the first quarter of FY26 has hurt Bandhan Bank’s stock, which fell 3% even though the rest of the market was calm. Even if total deposits and retail term deposits have grown quickly, the fact that low-cost deposits and the loan book have fallen in value over time is likely to make investors wary in the short run.

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