IDFC First Bank expects NIM to grow from Q3

IDFC First Bank's net interest margin (NIM), which saw compression over the past two quarters, is expected to improve, said V Vaidyanathan (pictured), managing director (MD) and chief executive officer (CEO).

- ANUPREKSHA JAIN

‘As the bank passed on the full impact ofthe cut in reporate, the interest margins are expected to rise from Q3 (October-December) onwards.

“We feel this is likely the low point for NIMs. We see sequential improvement in Q3 and further uptick in Q4,” he said. He noted that future rate cuts, if any, could make the bank reevaluate things.

‘The private lender’s interest margins in Q2 were at 5.59 per cent, down 59 basis points (bps) on a yearly basis and 12 bps quarter-on-quarter (Q-o-Q).

In Q1FY26, the NIM was at 5.71 per cent and 5.87 percent in Q4FY25.

On the sequential decline in profits, Vaidyanathan added that the drop was largely due to the absence of treasury gains amounting to %470 crore booked in Q1.

Apart from these, core profitability actually improved Q-o-Q and year-on-year (Yo-Y).