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SFBs' Q1 Net Slumps 76% as Credit Costs Mount
Business Standard
|August 28, 2025
Rising stress, mostly in small-ticket loans and micro, small and medium enterprises (MSMEs), hit the bottom line of small finance banks (SFBs) during the first quarter of this financial year (Q1FY26).
Net profit fell 76.2 per cent year-on-year (Y-o-Y) to ₹309 crore in the June quarter due to a sharp rise in stress-loan provisions (credit costs) and erosion in net interest income. These banks had posted a net profit of ₹1,300 crore a year ago (Q1FY25).
Sequentially, net profit shrank by 46.1 per cent over ₹573 crore in the quarter ended March 2025 (Q4FY25), according to data compiled by BS Research Bureau for eight listed SFBs. The operating profits were down 8.5 per cent Y-o-Y to ₹2,662 crore and 0.4 per cent sequentially from ₹2,674 crore.
This story is from the August 28, 2025 edition of Business Standard.
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