Bandhan Bank’s business update for the March quarter of FY26 points to a calibrated growth trajectory, marked by steady advances expansion and a clear shift towards granular, retail-led deposits, even as CASA ratios remain under pressure.
Credit growth remains steady
The bank’s advances portfolio rose 12.6% year-on-year to ₹1,54,235 crore, compared with ₹1,36,995 crore in the year-ago period, indicating stable credit momentum despite a relatively cautious operating environment.
The growth suggests continued traction in core lending segments, although it remains broadly in line with industry trends rather than indicating aggressive expansion.
Deposit growth lags credit expansion
Total deposits grew 10% year-on-year to ₹1,66,344 crore from ₹1,51,212 crore, trailing advances growth. This divergence implies a tighter liquidity position and could exert pressure on funding costs if the gap persists.
CASA weakness reflects industry trend
CASA deposits grew a modest 2.8% to ₹48,751 crore, but the CASA ratio declined sharply to 29.1% from 31.37% a year ago.
The decline underlines the ongoing industry-wide challenge of mobilising low-cost deposits amid rising interest rates and heightened competition for savings.
Strong shift towards retail term deposits
A key highlight of the quarter is the sharp 30.1% surge in retail term deposits to ₹73,796 crore, up from ₹56,719 crore.
This has significantly improved the composition of the deposit base, with retail deposits now accounting for 73.67% of total deposits, compared to 68.88% last year. The shift indicates a strategic focus on building a more stable and granular liability franchise.
Bulk deposits decline improves liability profile
Bulk deposits declined 6.9% to ₹43,797 crore from ₹47,056 crore, reducing their share in total term deposits to 37.24% from 45.34%.
While this may marginally increase the cost of funds in the near term, it strengthens the bank’s liability profile by reducing dependence on volatile, rate-sensitive bulk funding.