IDFC FIRST Bank has released its business update for the quarter and year ended March 31, 2026, showcasing robust growth across key financial metrics despite challenging market conditions. The bank communicated these developments through official notification IDFCFIRSTBANK/SD/06/2026-27 dated April 3, 2026, to both NSE and BSE under SEBI regulations.

Strong Loan and Deposit Growth Performance

The bank demonstrated impressive expansion in its core business segments during Q4FY26. Loans and advances recorded substantial year-over-year growth, while customer deposits maintained steady momentum despite market headwinds.

Deposit Resilience Amid Market Challenges

The bank's deposit growth remained resilient despite multiple headwinds during the quarter, including year-end advance tax outflows, tight liquidity environment, news flow about incidents reported during the quarter, prevailing West Asia crisis, and reduction of interest rates on savings accounts between 50 to 200 basis points in key buckets during Q4FY26. The bank opened as many new accounts during March 2026 as in prior months, indicating stability in customer acquisition.

Key Financial Ratios and Asset Quality

The CASA ratio stood at 49.8% as of March 31, 2026, compared to 51.6% as of December 31, 2025. However, the average CASA ratio remained stable at 50.4% for Q4FY26 versus 50.0% for Q3FY26. The average Liquidity Coverage Ratio (LCR) for Q4FY26 was stable at 114.00%, demonstrating strong liquidity management.

Asset Quality Improvements

The bank reported that asset quality of the microfinance institution (MFI) book returned to normalcy, while asset quality in the rest of the portfolio continues to remain stable. Average customer deposits increased by 3.0% on a sequential basis, with the bank expecting deposit growth to strengthen from Q1FY27 onwards.

The notification was digitally signed by Satish Gaikwad, General Counsel and Company Secretary, on April 3, 2026. All figures remain provisional and subject to audit by the bank's statutory auditors, with loans and advances including credit investment in corporate bonds, pass-through certificates, and security receipts.

IDFC FIRST Bank 's Chief Executive Officer has provided an optimistic outlook for the bank's financial performance, projecting profitability in the fourth quarter despite significant operational challenges. The CEO's statement comes amid concerns about fraud-related losses and elevated credit costs that have impacted the banking sector.

Q4 Profitability Projection

The bank's leadership has expressed confidence in achieving profitability during the fourth quarter, even after absorbing the complete financial impact of the Haryana fraud incident. This projection demonstrates the bank's ability to maintain operational resilience while managing unexpected losses from fraudulent activities.

Credit Cost Outlook

Looking ahead to the next financial year, the CEO has projected that credit costs will decline below the 2% threshold. This improvement is expected to be driven by the easing impact from microfinance institution (MFI) related challenges that have previously affected the bank's cost structure.

Strategic Recovery

The bank's management appears confident in its ability to navigate through current challenges while positioning for improved financial metrics. The projected reduction in credit costs suggests that previous pressures from the microfinance segment are expected to stabilize, contributing to overall financial health improvement.