IDFC First Bank’s quarter net profit crossed Rs 1,000 crore for the first time, pushed by improved growth trajectory across all operating metrics.

The private lender said it is targeting a share of 2.5% in foreign currency non-resident (Bank), or FCNR(B), deposits under the Reserve Bank of India’s concessional swap window. 

“With respect to FCNR(B), we feel that through a combination of leverage and the SBLC structure, we are hopeful of garnering a share of about 2.5% or so. We have announced an rate of 6.75% on these deposits, which is quite competitive and we feel that is a very good opportunity which we want to capitalise,” IDFC First Bank chief financial officer Sudhanshu Jain told analysts in the post-earnings call.

The FCNR(B) deposit inflows could fall between $1.5 billion and $2 billion, which would further secure the bank’s funding base.

Q1 net profit more than doubles to Rs 1,075 cr

The private lender’s fiscal first-quarter net profit more than doubled over the year-ago period to Rs 1,075 crore, helped by strong growth in net interest income (NII) and lower provisions. It was up 132.4% from Rs 463 crore posted in the same quarter last year.

NII, the difference between interest earned and interest paid, increased 21.1% YoY to Rs 5,972 crore from Rs 4,933 crore a year earlier.

Net Interest Margin (NIM) widened by 25 basis points to 5.96% in Q1 FY27 from 5.71% in Q1 FY26. Sequentially, it was up by 3 bps.

The bank’s core operating profit was up 36% YoY to ₹2,371 crore during the June quarter.

The cost-to-income ratio (excluding trading gains) improved to 70.7% in Q1-FY27 from 73.8% in Q1-FY26.

Asset quality improves

The bank’s gross non-performing assets (NPAs) improved by 10 bps to 1.51% at the end of the June quarter from 1.61% in the preceding March quarter. 

Net NPA similarly improved by 4 bps to 0.44% from 0.48% in the preceding quarter.

Gross slippages was almost down by 30% YoY while net slippages was lower by 44%. 

The bank's provisions declined to Rs 1,144 crore in the June 2026 quarter from Rs 1,659 crore a year ago. 

Total biz

The bank’s total customer business crossed Rs 6 lakh crore during the June quarter. 

Comprising loans and customer deposits, it rose 18.6% YoY to Rs 6.05 lakh crore, from Rs. 5.10 lakh crore a year earlier. On a quarter-on-quarter (QoQ) basis, total customer business grew 5.2%.

Loan growth

The bank's loan book crossed Rs 3 lakh crore in the June quarter. It rose 20.6% YoY to reach Rs 3.05 lakh crore from Rs 2.53 lakh crore a year ago. Sequentially, it grew 5.2%.

The incremental growth on the loan side was primarily driven by mortgages, vehicle loans, corporate loans and consumer loans. 

The retail, agriculture and MSME (RAM) portfolio expanded 18.2% YoY to Rs 2.41 lakh crore. The wholesale book powered up to a YoY growth of 30.4% to Rs 64,252 crore at the end of the June quarter.

Under retail finance which was up 21.5% YoY to Rs 1.79 lakh crore, consumer credit grew at a brisk pace of 27.3% to Rs 57,834 crore while vehicle loans rose 26.4% to Rs 34,144 crore. Mortgage loans (including home loans and loan against property) grew slower at 8.1% YoY to Rs 62,480 crore while gold loans rose 103% on a low base to reach Rs 4,892 crore at end-June. The credit card business touched Rs 9,580 crore, up 18.6% YoY, on a base of 4.8 million cards. 

Under rural finance which touched Rs 24,427 crore on a modest YoY growth of 2.1%, microfinance loans de-grew from the year-ago period by 19.8% to be at Rs 6,698 crore at the end of the June quarter. 

Retail finance account for 59% of the bank’s total loan mix as on 30 June 2026, followed by wholesale loans at 21%. While MSME financing made up 12% of the asset mix with a loan size of Rs 37,499 crore, rural finance accounted for 8%.

Deposit growth

Customer deposits fell just short of Rs 3 lakh crore to hit Rs 2.99 lakh crore as of 30 June 2026, up 16.6% YoY. 

Total deposits, which is customer deposits plus certificate of deposits, grew 17.7% to Rs 3.12 lakh crore. 

With customer deposits, CASA (current account savings account) crossed Rs 1.50 lakh crore to be at Rs 1.58 lakh crore, up 24.6% YoY.

The CASA ratio widened to 50.8% as of 30 June 2026, compared with 49.8% in the preceding March quarter and 48% a year ago.

The cost of funds improved by 46 bps from 6.42% in Q1 FY26 to 5.96% in Q1 FY27.

The NRI (non-resident Indians) deposits stood at Rs 24,876 crore. In the wealth management business, the AUM has reached almost Rs 64,000 crore with a rise of 24% YoY. 

Capital adequacy and ROA

The bank's return on assets (ROA) improved to 1.06% in Q1 FY27 from 0.54% a year ago. 

The capital adequacy ratio stood at 15.05%, including a Common Equity Tier-I (CET-I) ratio of 13.33%.