Federal Bank [NSE: FEDERALBNK], a key player in India’s banking sector, reported its Q1 FY26 results for the quarter ended 30th June 2025. The results reflected a challenging quarter for the lender as it posted a drop in net profit despite strong momentum in key segments. For investors tracking the Federal Bank share price, the earnings release provides critical context. The performance also holds significance for those analysing banking stocks more broadly this results season.
For Q1 FY26, Federal Bank reported a 14.6% year-on-year decline in standalone net profit, bringing it down to ₹861.75 crore from ₹1,009.53 crore in the same period last year. However, total income for the quarter rose 7.6% YoY to ₹7,799.61 crore.
Key Financial Results for Federal Bank Q1 FY26
| Particulars | Q1 FY26 (₹ Cr) | Q4 FY25 (₹ Cr) | Q1 FY25 (₹ Cr) | YoY Growth (%) | QoQ Growth (%) |
| Total Income (₹ Cr) | 7,799.6 | 7,654.3 | 7,246.1 | 7.6 | 1.9 |
| Net Profit (₹ Cr) | 861.8 | 1,030.2 | 1,009.5 | -14.6 | -16.3 |
| EPS Basic (₹) | 3.51 | 4.2 | 4.14 | -15.2 | -16.4 |
| EPS Diluted (₹) | 3.47 | 4.16 | 4.09 | -15.2 | -16.6 |
Important Updates from Federal Bank’s Latest Financial Results
Dip in Profitability Despite Revenue Growth
Federal Bank’s standalone net profit declined by 14.6% YoY to ₹861.75 crore. However, the bank reported total income of ₹7,799.61 crore, registering 7.6% YoY growth. A major contributor was the record other income, which stood at ₹1,113 crore—up 21.6% YoY.
Net Interest Income (NII) Sees Mild Growth
The bank’s net interest income rose 2% YoY to ₹2,336.83 crore from ₹2,292 crore in Q1 FY25. Net interest margin stood at 2.94%.
Momentum in Retail and Commercial Lending
Federal Bank’s retail advances grew 15.6% YoY to ₹81,047 crore. Commercial banking loans saw a sharp 30.3% increase to ₹25,028 crore, while corporate loans were up 4.5% to ₹83,680 crore.
Stable Asset Quality
Gross NPAs stood at 1.91%, and net NPAs at 0.48%, reflecting stable asset quality. The provision coverage ratio (excluding technical write-offs) was at 74.41%.
Strong CASA and Capital Position
CASA deposits rose 12% YoY to ₹87,236 crore. The capital adequacy ratio stood at 16.03%, while net worth increased 12.2% YoY to ₹33,994 crore.
Management Commentary
MD & CEO KVS Manian highlighted strong performance across commercial banking, credit cards, and gold loans. He noted improving productivity, record fee income, and stable margins, while also acknowledging elevated credit costs due to Agri and MFI slippages.
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