IDFC First Bank Limited has completed the allotment of equity shares to its employees under the Employee Stock Option Scheme (ESOS) on December 22, 2025. The bank allotted 7,96,222 equity shares of face value ₹10 each to eligible employees who exercised their vested stock options.

Share Allotment Details

The allotment represents the exercise of stock options by employees under the IDFC FIRST Bank-ESOS program. The newly issued shares carry the same rights and privileges as existing equity shares of the bank.

Impact on Share Capital

The allotment has resulted in an increase in the bank's issued and paid-up equity share capital.

Regulatory Compliance

The disclosure was made in compliance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Employee Stock Option Scheme serves as an important tool for employee retention and motivation, allowing eligible staff members to participate in the bank's growth through equity ownership. The exercise of these options demonstrates employee confidence in the bank's long-term prospects and aligns their interests with those of shareholders.

India Ratings and Research (Ind-Ra) has reaffirmed IDFC FIRST Bank 's debt instruments worth ₹17,928.00 crores at IND AA/Stable rating. This rating covers Basel III Tier 2 Bonds, Infrastructure Bonds, and Non-Convertible Debt Instruments.

Key Factors Behind the Rating

The affirmation reflects several positive aspects of IDFC FIRST Bank's operations:

1. Continued Franchise Expansion: The bank has shown consistent growth in its operations and market presence.
2. Experienced Management: The leadership team's expertise contributes to the bank's stable performance.
3. Stable Liability Franchise: IDFC FIRST Bank maintains a robust deposit base.
4. Diversified Product Portfolio: The bank offers a wide range of financial products and services.
5. Improved Capital Buffers: The bank's capital position has strengthened over time.

Financial Performance

Key financial metrics for IDFC FIRST Bank:

Despite the growth in total assets and revenue, the bank experienced a significant decrease in net profit. This decline may be attributed to higher operating expenses and credit costs, which have been impacting the bank's internal accruals.

Challenges and Constraints

While the rating affirmation is positive, Ind-Ra noted some constraints:

1. Higher Operating Expenditure: The bank's cost-to-income ratio remains elevated compared to peers.
2. Credit Costs: Increased credit costs have been putting pressure on profitability.
3. Internal Accruals: The bank's internal capital generation remains lower than higher-rated peers.

Asset Quality

As of the latest available data, IDFC FIRST Bank's gross non-performing assets (NPAs) stood at 1.86%, showing stability in asset quality management. The provision coverage ratio improved to 72.20%, indicating a conservative approach to potential risks.

Funding Profile

The bank has made progress in retail deposits, with its CASA (Current Account Savings Account) ratio improving to 50.10%. This improvement in the deposit mix is likely to support the bank's funding costs over time.

Outlook

While IDFC FIRST Bank faces challenges in terms of profitability and operational efficiency, its stable asset quality, improving deposit franchise, and adequate capital buffers support the current rating. The bank's ability to improve its cost structure, manage credit costs, and enhance internal capital generation will be key factors to watch in the coming quarters.

Investors and stakeholders should continue to monitor the bank's performance, particularly in areas of cost management and profitability improvement, as these will be crucial for maintaining its current rating and potential future upgrades.