Federal Bank announced its audited financial results for FY26 following a Board meeting held on April 29, 2026. The bank delivered solid performance with net profit reaching ₹4,117.32 crore, representing growth of 1.61% compared to ₹4,051.89 crore in the previous year. The Board recommended a final dividend of 60%, equivalent to ₹1.20 per equity share of face value ₹2 each, subject to shareholder approval at the ensuing Annual General Meeting. The bank subsequently released the transcript of its Q4FY26 earnings conference call on May 05, 2026, filed under reference SEC/LODR/47/2026-27.

Q4FY26 Quarterly Performance Highlights

The fourth quarter demonstrated remarkable operational strength with net profit surging to ₹1,259.10 crore, marking sequential growth of 20.93% from ₹1,041.21 crore in Q3FY26. Total income for Q4FY26 stood at ₹8,544.04 crore, while operating profit reached ₹2,276.41 crore. The bank achieved significant milestones with both CASA and NR deposits crossing the ₹1 lakh crore mark simultaneously. MD & CEO KVS Manian noted during the earnings call that the Q4 performance reflects strong operational execution consistent with the bank's long-term strategic priorities, describing it as a record quarter on several metrics.

*Not annualised

Executive Director & CFO Venkatraman Venkateswaran clarified during the call that the underlying net profit, excluding one-off gains, stood at ₹1,145 crore, representing nearly 10% sequential growth and described as the highest-ever quarterly net profit for the bank on that basis. He noted that NIM expanded to 3.20%, up 2 basis points sequentially, supported by a reduction in funding costs with the overall cost of funds declining 4 basis points to 5.46%. The cost-to-income ratio improved to 52.86%, down 106 basis points sequentially. ROA on an underlying basis increased to 1.24%, up 9 basis points sequentially, while ROE improved to 12.47%, an expansion of 79 basis points quarter-on-quarter.

Balance Sheet Strength and Asset Quality

The bank's balance sheet demonstrated robust growth with total business reaching ₹5,78,503.76 crore, growing 4.54% quarter-on-quarter. Total deposits increased to ₹3,13,909.39 crore with 5.41% QoQ growth, while gross advances stood at ₹2,64,594.37 crore. CASA balances reached ₹1,03,390.30 crore with the CASA ratio improving to 32.94%, showing a 271 basis points year-on-year improvement. Management noted during the call that CASA growth of nearly 21% year-on-year is among the best in the industry, with the cost of deposits declining 5 basis points quarter-on-quarter to 5.43%.

Asset quality metrics remained exemplary with Gross NPA at 1.62% and Net NPA at 0.20% as of March 31, 2026. During the call, Venkatraman noted that NNPA on an underlying basis stood at 0.37%, down 5 basis points quarter-on-quarter, marking an all-time low for the bank. The provision coverage ratio, excluding technical write-offs, increased to 76.55%, up 141 basis points sequentially, while credit cost for the quarter was maintained at 47 basis points. The Capital Adequacy Ratio under Basel III stood at 17.25%, and the Liquidity Coverage Ratio (LCR) was approximately 119%, with management indicating comfort operating in the 115%–120% range.

Management Commentary on Growth and Strategy

During the earnings call, KVS Manian addressed analyst questions on deposit and loan growth, noting that while headline deposit growth appeared below system levels, CASA and retail term deposit growth were significantly above system rates. The bank consciously reduced reliance on high-value wholesale deposits during the year. On advances, commercial banking grew nearly 6% quarter-on-quarter and 26% year-on-year, while gold loans grew 26% year-on-year and 9% quarter-on-quarter. The LAP portfolio expanded 8% quarter-on-quarter, and the CV/CE business saw a sequential uptick of 8.50%. Agriculture and microfinance grew 5% and 7.28% quarter-on-quarter, respectively.

On fee income, management highlighted that fee income for Q4FY26 reached ₹990.92 crore, growing 10.54% quarter-on-quarter and 24% year-on-year, describing it as a record best-ever performance. Key drivers identified include credit card fees, wealth management, and trade and forex fees. The bank's diversified credit portfolio comprises retail banking at 54% of customer assets, commercial banking at 35%, and corporate banking at 11%. Management also confirmed plans to open approximately 100 new branches in the coming year, having added 39 branches in Q4FY26 alone, guided by a data-driven network strategy.

Macro Environment and Risk Outlook

Venkatraman provided commentary on the macro environment, noting that headline CPI averaged approximately 3.10% for the quarter and core CPI averaged around 2.10%, reflecting continued supply-side efficiency. The RBI held the repo rate at 5.25% following 125 basis points of easing through calendar 2025. Management flagged the West Asia conflict, which escalated from February 28 onwards, as a key macro risk introducing volatility into global energy markets, with the full inflationary pass-through expected to reflect in the later part of Q1 FY27. On credit cost guidance, management maintained the existing guidance of 50 to 60 basis points, noting that uncertainties in the environment precluded a revision at this stage. The one-off floating provision of ₹456 crore was clarified as being created primarily as a buffer for the transition to the Expected Credit Loss (ECL) framework and not reflective of any deterioration in asset quality.

Regulatory Filings and Board Meeting Details

The audited financial results were approved by the Board at its meeting held on April 29, 2026, which commenced at 1:20 p.m. and concluded approval of financial results at 1:50 p.m. The earnings call transcript was made available on the bank's website and filed with exchanges on May 05, 2026. Pursuant to Regulation 33(3)(d) of SEBI Listing Regulations, the Joint Statutory Auditors—M/s. M S K A & Associates LLP and M/s. Suri & Co—issued an unmodified opinion on the audited standalone and consolidated financial results for FY26.

Pursuant to Regulation 30 and 47 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the bank published its audited financial results for Q4FY26 in newspapers on April 30, 2026. The results were published in "Financial Express" (English) and "Deepika" (Malayalam). The complete financial results and earnings call transcript are available on the bank's official website.

Federal Bank has executed a deed of assignment with Standard Chartered Bank, India on May 4, 2026, to acquire a select portfolio of retail credit cards, following the Board of Directors' approval granted on April 30, 2026. The transaction marks a significant strategic expansion in the retail banking segment and was disclosed under Regulation 30 of the SEBI LODR Regulations.

Transaction Execution

The deed of assignment was executed on May 4, 2026, between Federal Bank Ltd and Standard Chartered Bank, India. Under this arrangement, Federal Bank will acquire the select retail credit card portfolio from SCB India. The DOA provides for the assignment of certain receivables arising from existing credit card relationships from SCB India to the Bank.

Migration Plan and Cardholder Transition

The agreement specifies that identified credit card relationships between SCB India and relevant cardholders will be terminated in accordance with a mutually agreed migration plan. Federal Bank will issue replacement credit cards to the identified cardholders in lieu of their credit card relationships with SCB India, following the agreed migration framework.

Board Approval Timeline

The Board meeting was held across two days, commencing at 01:20 p.m. on April 29, 2026, and resuming at 10:00 AM on April 30, 2026. The specific matter regarding the credit card portfolio acquisition was approved at 11:15 AM on April 30, 2026.

Regulatory and Transaction Details

The disclosure confirms that the transaction does not fall within the ambit of a related party transaction. Federal Bank does not have any shareholding in SCB India, and neither party is related to each other's promoter, promoter group, or group companies. The transaction does not involve issuance of shares. The communication was signed by Company Secretary Samir Pravinchandra Rajdev and digitally authenticated on May 4, 2026, at 12:51:04 +05'30.