IDFC FIRST Bank Q1 FY26 Net Profit at ₹463 Cr; Down 32% YoY, Up 52% QoQ Amid MFI Pressures
By HDFC SKY | Updated at: Jul 26, 2025 07:15 PM IST
Mumbai, July 26, 2025 – IDFC FIRST Bank (NSE: IDFCFIRSTB, BSE: 539437) reported a standalone net profit of ₹463 crore for Q1 FY26, a sequential rise of 52.1% from Q4 FY25, though 32% lower year-on-year. The decline was primarily attributed to higher delinquencies in the microfinance portfolio and narrowing interest margins.
Key Financial Highlights (₹ in crore)
| Particulars | Q1 FY26 | Q4 FY25 | Q1 FY25 | YoY (%) | QoQ (%) |
|---|---|---|---|---|---|
| Net Interest Income (NII) | 4,933 | – | 4,695 | 5.1% | – |
| Fee & Other Income | 1,731 | – | 1,595 | 8.5% | – |
| Operating Income (incl. trading gains) | 7,160 | – | 6,314 | 13.4% | – |
| Operating Profit (excl. trading gains) | 1,744 | – | 1,858 | -6.2% | +7.8% |
| Operating Profit (incl. trading gains) | 2,239 | – | 1,882 | +19.0% | – |
| Net Profit | 463 | 304 | 681 | -32.0% | +52.1% |
| Provisions | 1,659 | – | – | – | – |
Business Performance Snapshot
Deposits & Liabilities
- Total Customer Deposits rose 25.5% YoY to ₹2,56,799 crore.
- Retail Deposits climbed 24.5% to ₹2,04,222 crore, making up 80% of total deposits.
- CASA Deposits surged 30.2% to ₹1,27,158 crore; CASA Ratio improved to 48.0% (vs 46.6% last year).
Lending Operations
- Loans & Advances grew 21.0% YoY to ₹2,53,233 crore.
- Retail, Rural & MSME book rose 17.4% YoY to ₹2,03,954 crore.
- Wholesale Book expanded 38.6% to ₹49,279 crore.
- Microfinance portfolio declined 36.9% YoY; now just 3.3% of the total loan book.
Asset Quality & Provisions
| Metric | Q1 FY26 | Q4 FY25 |
|---|---|---|
| Gross NPA | 1.97% | 1.87% |
| Net NPA | 0.55% | 0.53% |
| Gross NPA (Retail/Rural/MSME ex-MFI) | 1.48% | – |
| Provision Coverage Ratio (PCR) | 72.3% | – |
- SMA-1+2 in Retail/Rural/MSME (ex-MFI) was 0.94%, up from 0.87%.
- Microfinance SMA improved significantly to 2.64% from 5.10%.
- ₹1,659 crore in provisions made during the quarter, majorly for MFI stress; ₹315 crore MFI buffer remains unutilized.
- 72% of outstanding MFI loans now insured under CGFMU.
Capital Position
| Metric | Q1 FY26 Reported | Post-Capital Raise (Est.) |
|---|---|---|
| CRAR | 15.01% | 17.60% |
| CET-I Ratio | 12.80% | 15.38% |
| Capital Raise Amount | — | ₹7,500 crore |
Strategic Commentary
V. Vaidyanathan, MD & CEO, commented:
“Our core franchise is strong with 25.5% YoY deposit growth. Despite margin pressure from repo pass-through and portfolio mix, we expect improvement in H2 FY26 as term deposit repricing kicks in and MFI stress recedes. The business fundamentals remain robust with healthy asset quality outside MFI.”
About the Bank
IDFC FIRST Bank is a new-age private sector bank with over 35.5 million customers, ₹2.56 lakh crore in deposits, and ₹2.53 lakh crore in advances across 60,000+ locations. The bank has 1,016 branches and a strong digital-first model. It holds high ESG scores and is recognized for ethical, customer-friendly, and inclusive banking practices.
Note: The financial results are unaudited and based on the Q1 FY26 press release filed on July 26, 2025.
REF: https://nsearchives.nseindia.com/corporate/IDFCFIRSTB_26072025152351_BM-Press_Release_Q1FY26.pdf
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