Federal Bank has reported 14% growth in net profit at Rs 1030.23 crore for the quarter ended March 2025 (Q4FY2025). The bank has posted 8% growth in net interest income (NII), while the core fee income of the bank improved 31% in Q4FY2025. The Net Interest Margin (NIM) of the bank declined marginally to 3.12% in Q4FY2025 compared to 3.21% in the corresponding quarter of previous year.
On business front, the bank has posted 12% growth in business with 12% increase in loan book. The asset quality of the bank has continued to improve in Q4FY2025. Bank has maintained stable credit to deposit ratio to 84.0% at end March 2025 from 84.2% at end March 2024. The CASA ratio of the bank has improved to 30.2% at end March 2025 from 29.4% at end March 2024.
Asset quality improves: The bank has continued to improve asset quality in Q4FY2025.
The fresh slippages of loans stood at Rs 492 crore in Q4FY2025 compared with 498 crore in previous quarter and Rs 371 crore in the corresponding quarter last year. The recoveries and upgradations of NPAs stood at Rs 434 crore, while the write-off of loans was at Rs 235 crore in Q4FY2025. The standard restructured loan book of the bank stood at Rs 1427 crore end March 2025. Provision coverage ratio improved to 75.37% at end March 2025 compared to 74.21% a quarter ago and 71.08% a year ago. The capital adequacy ratio of the bank stood at 16.4% with Tier I ratio at 15.0% at end March 2025. The risk weighted assets of the bank has increased 11% YoY to Rs 202656 crore end March 2025,
| Asset Quality Indicators: Federal Bank |
| ' | Mar-25 | Dec-24 | Sep-24 | Jun-24 | Mar-24 | Variation |
| QoQ | YoY |
| Gross NPA (Rs Crore) | 4375.54 | 4553.31 | 4884.49 | 4738.35 | 4528.87 | -4 | -3 |
| Net NPA (Rs Crore) | 1040.38 | 1131.17 | 1322.29 | 1330.44 | 1255.33 | -8 | -17 |
| % Gross NPA | 1.84 | 1.95 | 2.09 | 2.11 | 2.13 | -11 | -29 |
| % Net NPA | 0.44 | 0.49 | 0.57 | 0.60 | 0.60 | -5 | -16 |
| % PCR | 75.37 | 74.21 | 71.82 | 70.79 | 71.08 | 116 | 429 |
| % CRAR - Basel III | 16.40 | 15.16 | 15.20 | 15.57 | 16.13 | 124 | 27 |
| % CRAR - Tier I - Basel III | 15.04 | 13.78 | 13.82 | 14.17 | 14.61 | 126 | 43 |
| Variation in basis points for figures given in percentages and in % for figures in Rs crore |
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Business Highlights:
Healthy business growth: The business of the bank has increased 12% YoY to Rs 521781 crore end March 2025, driven by 12% surge in advances to Rs 238134 crore. Deposits rose 12% to Rs 283647 crore at end March 2025.
CASA deposits ratio improves: The CASA deposits of the bank increased 16% YoY to Rs 85757 crore at end March 2025. The current account deposits increased 35% to Rs 16199 crore, while saving account deposits moved up 11% to Rs 64146 crore end March 2025. The CASA ratio rose to 30.2% at end March 2025 compared to 29.4% at end March 2024. The term deposits have increased 11% to Rs 197890 crore end March 2025.
Strong loan growth: Advances growth was driven by retail loans rising 14% YoY to Rs 104417 crore at end March 2025, while credit to agriculture increased 9% to Rs 8209 crore and MSME 15% to Rs 23708 crore at end March 2025. The corporate credit has increased 13% to Rs 106973 crore end March 2025.
Investment book of the bank increased 9% YoY to Rs 66246 crore at end March 2025.
Margins ease: The bank has shown 8 bps YoY increase in cost of deposits to 5.98%, while yield on advances eased 17 bps YoY to 9.31% in Q4FY2025. Thus, the NIM has declined 9 bps YoY to 3.12%, while rose 1 bps qoq to 3.12% in Q4FY2025.
Branch expansion: The bank has added 39 branches and 26 ATMs in Q4FY2025, taking overall tally to 1589 branches and 2080 ATM`s end March 2025.
Book value of the bank stood at Rs 136.1 per share at end March 2025, while the adjusted book value (net of NNPA and 10% of restructured advances) was Rs 131.3 per share at end March 2025.
Quarterly Performance
NII rises on nearly stable NIM: Bank has recorded 11% increase in the interest earned at Rs 6648.36 crore, while interest expenses increased 13% to Rs 4270.92 crore in Q4FY2025. NII improved 8% to Rs 2377.44 crore in the quarter ended March 2025.
Healthy growth in the core fee income: Bank has posted strong 31% growth in core fee income to Rs 751 crore, while the forex income increased 17% to Rs 49 crore. Further, the treasury income jumped 47% to Rs 205 crore, leading to 33% jump in the overall non-interest income to Rs 1005.95 crore in the quarter ended March 2025.
Expenses ratio improves: The operating expenses of the bank increased 4% to Rs 1917.99 crore, as other expenses moved up 19% to Rs 1134.15 crore, while employee expenses declined 12% to Rs 783.84 crore in Q4FY2025. Cost to income ratio improved to 56.7% in Q4FY2025 compared with 62.3% in Q4FY2024, helping the Operating Profit to increase 32% to Rs 1465.40 crore.
Provisions and contingencies rise: The bank has showed rebound in provisions to Rs 138.11 crore. The loan loss provisions jumped 2014% to Rs 148 crore, while the bank has written back investment provisions Rs 6 crore and standard asset provisions of Rs 8 crore in Q4FY2025.
Effective tax rate declined to 22.4% in Q4FY2025 from 24.8% in Q4FY2024. Net Profit rose by 14% YoY to Rs 1030.23 crore during quarter ended March 2025.
Financial Performance FY2025:
Bank has posted 9% increase in net profit to Rs 4051.89 crore in the year ended March 2025 (FY2025). The net interest income increased 14% to Rs 9467.99 crore, while non-interest income moved up 23% to Rs 3801.25 crore, pushing up net total income by 17% to Rs 13269.24 crore in FY2025. The operating expenses increased 16% to Rs 7168.11 crore, while provision and contingencies galloped 274% to Rs 733.06 crore, allowing profit before tax to increase 8% to Rs 5368.07 crore in FY2025. The cost-to-income ratio improved to 54.0% in FY2025 compared to 54.5% in FY2024. An effective tax rate declined to 24.5% in FY2025 compared to 25.3% in FY2024. The net profit has increased 9% to Rs 4051.89 crore in FY2025.
| Federal Bank: Results |
| Particulars | 2503 (3) | 2403 (3) | Var % | 2503 (12) | 2503 (12) | Var % |
| Interest Earned | 6648.36 | 5978.35 | 11 | 26365.25 | 22188.26 | 19 |
| Interest Expended | 4270.92 | 3783.24 | 13 | 16897.26 | 13894.78 | 22 |
| Net Interest Income | 2377.44 | 2195.11 | 8 | 9467.99 | 8293.48 | 14 |
| Other Income | 1005.95 | 753.88 | 33 | 3801.25 | 3079.27 | 23 |
| Net Total Income | 3383.39 | 2948.99 | 15 | 13269.24 | 11372.75 | 17 |
| Operating Expenses | 1917.99 | 1838.64 | 4 | 7168.11 | 6198.27 | 16 |
| Operating Profits | 1465.40 | 1110.35 | 32 | 6101.13 | 5174.48 | 18 |
| Provisions & Contingencies | 138.11 | -94.60 | -246 | 733.06 | 196.10 | 274 |
| Profit Before Tax | 1327.29 | 1204.95 | 10 | 5368.07 | 4978.38 | 8 |
| EO | 0.00 | 0.00 | - | 0.00 | 0.00 | - |
| PBT after EO | 1327.29 | 1204.95 | 10 | 5368.07 | 4978.38 | 8 |
| Provision for tax | 297.06 | 298.65 | -1 | 1316.18 | 1257.78 | 5 |
| PAT | 1030.23 | 906.30 | 14 | 4051.89 | 3720.60 | 9 |
| EPS*(Rs) | 16.8 | 14.8 | ' | 16.5 | 15.1 | ' |
| Adj BV (Rs) | 131.3 | 113.4 | ' | 131.3 | 113.4 | ' |
| * Annualized on current equity of Rs 491.19 crore. Face Value: Rs 2, Figures in Rs crore |
| Source: Capitaline Corporate Database |
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