IDFC First Bank reported a steady March quarter performance, with net profit rising 4.9% year-on-year to ₹319 crore from ₹304 crore, supported by strong core income growth and improving asset quality.
Net interest income (NII) grew 15.7% YoY to ₹5,677 crore from ₹4,906 crore, reflecting continued traction in the bank’s loan book across segments.
Asset quality improved during the quarter, with gross non-performing assets (GNPA) declining to 1.61% from 1.69% sequentially, while net NPA eased to 0.48% from 0.53%.
Provisions saw a sharp decline to ₹869 crore, compared with ₹1,398 crore in the previous quarter and ₹1,450.4 crore a year ago, indicating easing stress. Provisions as a percentage of average loans also fell steadily through the year to 1.63% in Q4FY26.
The bank said a significant portion of loan growth was driven by mortgages, vehicle loans, consumer loans, business banking and wholesale lending. Its credit card base crossed 4.5 million during the quarter, while the wealth management business grew 23% YoY to over ₹57,000 crore.
During the quarter, the bank utilised ₹35 crore of contingency provisions related to microfinance and continues to carry forward ₹130 crore into the next financial year.
The bank also fully expensed the impact of an incident in Chandigarh during the quarter, with a post-tax impact of ₹483 crore. Management said it does not expect any further material financial adjustments related to the issue.
Commenting on the performance, Managing Director and CEO V Vaidyanathan said asset quality remains stable, with stress largely limited to the microfinance segment, which has now moderated.
“The asset quality of all businesses continues to perform well, except for the micro-finance book… with this issue behind us, GNPA and NNPA have come down to healthy levels,” he said, adding that provisions have declined to a two-year low.
He also noted that the first month of Q1FY27 has seen strong deposit growth, with the bank confident of sustaining momentum in its deposit franchise.