Utkarsh SFB Q1 FY26: Loan Portfolio Shifts, Deposits Remain Strong
Hello there, finance enthusiasts! Let’s dive into the latest business updates from Utkarsh Small Finance Bank (UTKARSHBNK) for the quarter ended June 30, 2025. This provisional data gives us a peek into how the bank is strategically evolving its operations. Remember, Utkarsh SFB, like other Small Finance Banks, plays a crucial role in promoting financial inclusion by serving the unserved and underserved segments of society. You can learn more about their mission here.
The bank’s shares were trading around ₹23.74, experiencing a modest dip of 1.2% around the time of this announcement.
Here’s a snapshot of their performance:
| Particulars (In Crore unless specified otherwise) | June 30, 2025 (Provisional) | June 30, 2024 (Limited Review) | Change YoY % | March 31, 2025 (Audited) | Change QoQ % |
|---|---|---|---|---|---|
| Gross Loan Portfolio* | 19,224 | 18,798 | 2.3% | 19,666 | (2.2)% |
| JLG Loan Portfolio* | 8,578 | 11,160 | (23.1)% | 9,207 | (6.8)% |
| Non-JLG Loan Portfolio | 10,647 | 7,638 | 39.4% | 10,459 | 1.8% |
| Total Deposits | 21,489 | 18,163 | 18.3% | 21,566 | (0.4)% |
| CASA Deposits | 4,218 | 3,453 | 22.1% | 4,699 | (10.2)% |
| Retail Term Deposits | 11,675 | 8,729 | 33.7% | 10,635 | 9.8% |
| Bulk Term Deposits | 5,597 | 5,980 | (6.4)% | 6,232 | (10.2)% |
| CASA Ratio (%) | 19.6% | 19.0% | 21.8% | ||
| CASA + Retail Term Deposits Ratio (%) | 74.0% | 67.1% | 71.1% |
*Note: Including IBPC issued by the Bank
Key Takeaways from Q1 FY26:
1. Strategic Shift in Loan Portfolio: The bank’s overall Gross Loan Portfolio saw a modest 2.3% year-on-year (YoY) growth, reaching ₹19,224 crore. However, a significant internal shift is evident. The Joint Liability Group (JLG) Loan Portfolio, traditionally a microfinance staple, saw a notable decrease of 23.1% YoY and 6.8% quarter-on-quarter (QoQ). This signals a deliberate move towards diversifying their lending book.
On the flip side, the Non-JLG Loan Portfolio absolutely soared, growing by a whopping 39.4% YoY to ₹10,647 crore! This diversification helps reduce concentration risk and taps into new growth avenues. 🚀
2. Robust Deposit Growth: Total Deposits showed strong growth of 18.3% YoY, standing at ₹21,489 crore. While there was a slight QoQ dip of 0.4%, the overall trend is positive. More impressively, Retail Term Deposits surged by 33.7% YoY and 9.8% QoQ, indicating a growing trust among retail customers.
3. Evolving Deposit Mix: While CASA (Current Account Savings Account) Deposits grew 22.1% YoY, they saw a 10.2% QoQ decline. Consequently, the CASA Ratio dipped to 19.6% from 21.8% last quarter. However, when combining CASA with Retail Term Deposits, the ratio stands at a healthy 74.0%, up from 71.1% last quarter, showing a strong reliance on stable, retail-sourced funding. 💪
4. Strong Asset Quality & Liquidity: The bank reported an impressive X Bucket Collection efficiency of 98.7% for Q1 FY26, underscoring sound asset management. Furthermore, the Liquidity Coverage Ratio (LCR) stood robustly at 238% as of June 30, 2025, significantly higher than regulatory requirements, indicating excellent liquidity management. 💧
It’s important to remember that these figures are provisional and subject to review by the bank’s Joint Statutory Auditors and subsequent approval from the Audit Committee and Board of Directors. Nevertheless, these updates paint a picture of a bank strategically diversifying its loan book and maintaining a strong financial footing. Keep an eye out for their audited results for the full picture! 📈
source: Corporate Announcement
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