Mumbai: Federal Bank announced on October 16, 2026, that its net profit for the second quarter of the fiscal year 2027 rose by 45.10% year-on-year to ₹1,386.09 crore, the highest quarterly profit in its history.
Financial Performance
The bank's operating profit grew 35.35% to ₹2,225.37 crore. Net Interest Income (NII) increased by 26.38% to ₹3,153.40 crore, while fee income saw a 31.86% rise to ₹1,167.71 crore, reaching an all-time high.
Asset Quality Improvement
Gross NPA improved to 1.32% and Net NPA to 0.17%, both representing decadal lows, the bank said. Fresh slippages declined 27.48% year-on-year, and the slippage ratio improved to 0.59% from 0.94% a year ago. The provision coverage ratio, excluding technical write-offs, strengthened to 86.78%.
Business Growth
Total business franchise exceeded ₹6.4 lakh crore, up 20.12% year-on-year, with gross advances crossing ₹3 lakh crore to reach ₹3,01,687.80 crore. Total deposits stood at ₹3,42,693.56 crore, an 18.61% year-on-year increase. CASA balances grew 22.56% to ₹1,09,803.15 crore.
Operational Metrics
The Cost-to-Income ratio improved 196 basis points year-on-year to 52.08%. Return on Assets (RoA) improved 23 basis points year-on-year to 1.32%, and Return on Equity (RoE) expanded 256 basis points year-on-year to 13.57%. The bank added 12 branches during the quarter, expanding its network to 1,662 banking outlets.
Management Commentary
KVS Manian, Managing Director and CEO, stated that the growth is coming from the core business. He added that gross and net NPA are at their lowest levels in a decade, with slippages down 27% and provision coverage at 87%.
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