Capital Small Finance Bank , a leading small finance bank in India, has reported a 5% year-on-year increase in net profit for the second quarter of fiscal year 2026. The bank's financial results for Q2 FY26 showcase steady growth across key business metrics, demonstrating its resilience in a dynamic economic environment.

Key Financial Highlights

• Net Profit: The bank's net profit rose to ₹35.00 crore in Q2 FY26, up from ₹33.00 crore in the same period last year, marking a 5% year-on-year growth.
• Gross Advances: Total advances grew by 18% year-on-year to ₹7,907.00 crore, compared to ₹6,718.00 crore in Q2 FY25.
• Deposits: Total deposits increased by 20% year-on-year to ₹9,317.00 crore, up from ₹7,780.00 crore in the corresponding quarter of the previous year.
• Disbursements: The bank reported a significant 36% year-on-year increase in disbursements, reaching ₹805.00 crore in Q2 FY26.

Asset Quality and Profitability

Capital Small Finance Bank maintained a stable asset quality profile:

• Gross Non-Performing Assets (GNPA) ratio stood at 2.70%, slightly improved from 2.75% in the previous quarter.
• Net Non-Performing Assets (NNPA) ratio was at 1.38%, compared to 1.39% in Q1 FY26.
• Return on Assets (RoA) improved to 1.30% in Q2 FY26, up from 1.20% in Q1 FY26.

Operational Performance

• The bank's Net Interest Margin (NIM) for Q2 FY26 was 4.00%, compared to 4.10% in Q1 FY26.
• Cost-to-Income Ratio improved to 61.70% in Q2 FY26, down from 61.40% in Q2 FY25.
• CASA Ratio (Current Account Savings Account) stood at 33.90%, with an average CASA of 34.80% for Q2 FY26.

Business Growth and Expansion

Capital Small Finance Bank continued to focus on expanding its presence and diversifying its loan portfolio:

• The bank operates 199 branches across 5 states and 2 Union Territories.
• The loan book remains well-diversified, with 30% in agricultural loans, 26% in mortgage loans, 23% in MSME and trading loans, and the remainder in corporate and consumption loans.
• The bank maintained its emphasis on secured lending, with 99.20% of its loan book being secured.

Management Commentary

Mr. Sarvjit Singh Samra, Managing Director & CEO of Capital Small Finance Bank, commented on the results: "The quarter ended September 30, 2025, was marked by healthy credit offtake and stable margins, reflecting the strength of our core operating model. Our total deposits reached ₹9,317.00 crore, up ~20% year-on-year, with CASA at 33.90%, highlighting the stability of our retail deposit franchise."

He further added, "We are confident that with the supportive macro backdrop — including benign inflation, GST-led consumption boost, and strong festive momentum — we are well-positioned to sustain healthy growth in deposits and advances in the second half of the year."

Capital Small Finance Bank's Q2 FY26 results demonstrate its continued focus on sustainable growth, asset quality, and operational efficiency. The bank's strategic emphasis on retail-focused liability franchise and secured lending positions it well for future growth in the evolving banking landscape.

Capital Small Finance Bank Limited has announced a significant addition to its board of directors. Mr. Bhavdeep Sardana, a seasoned professional in the agro-based food industry, has been appointed as a Non-Executive Non-Independent Director of the bank, effective August 04, 2025, for a term of eight years.

Key Appointment Details

Professional Background

Mr. Sardana brings a wealth of experience to the bank's board:

• Current Role: Senior Vice President & CEO of The Sukhjit Starch & Chemicals Limited
• Industry Experience: 30 years in agro-based food industries
• Expertise: Commercial, Administrative, Operations, and Management
• Company Profile: The Sukhjit Starch & Chemicals Limited is listed on NSE & BSE with an annual turnover of approximately Rs. 1500.00 crores

Additional Roles and Affiliations

Mr. Sardana holds several key positions:

• CEO of The Sukhjit Agro Industries, Himachal Pradesh
• Director in Sukhjit Mega Food Park & Infra Ltd., Phagwara, Punjab
• Member of the Punjab State Planning Board
• Member of the Punjab State Council for Agricultural Education
• Member of the Food Processing Advisory Committee, Government of Punjab

Corporate Governance

In line with regulatory requirements, the bank has disclosed that:

• There is no inter-se relationship between Mr. Sardana and other directors of the bank
• Mr. Sardana holds 1,28,391 equity shares in the bank jointly with his spouse, Mrs. Dipti Sardana
• He is not debarred from holding the office of Director by any SEBI Order or other authority

This appointment aligns with Capital Small Finance Bank's strategy to strengthen its board with diverse expertise. Mr. Sardana's extensive experience in the agro-based food industry and his various governmental affiliations are expected to bring valuable insights to the bank's operations and strategic decisions.

The bank's shareholders have shown confidence in this appointment through their approval via postal ballot, indicating a positive outlook on the potential contributions Mr. Sardana may bring to the institution's growth and governance.

As Capital Small Finance Bank continues to evolve in the competitive banking landscape, the addition of Mr. Sardana to its board may signal the bank's intent to enhance its understanding and possibly its footprint in the agro-based and rural banking sectors.