Capital Small Finance Bank has announced its provisional business highlights for the quarter ended December 31, 2025, demonstrating strong growth momentum across key financial parameters. The bank reported significant expansion in its loan portfolio and deposit base while maintaining stable asset quality metrics.

Financial Performance Overview

The bank's financial performance for Q3FY26 showcased robust growth across multiple dimensions:

Loan Portfolio Expansion

The bank's gross advances reached ₹8,164 crores as of December 31, 2025, marking a substantial year-on-year growth of 19.80% and quarter-on-quarter growth of 3.30%. Disbursements during the quarter increased significantly to ₹919 crores, compared to ₹737 crores in Q3FY25, reflecting a growth of 24.70%. The loan portfolio maintains its retail-centric approach with 98.70% of the book being secured, demonstrating the bank's focus on risk management and prudent lending practices.

Asset Quality Management

Asset quality remained consistently stable throughout the reporting period. Gross NPAs stood at 2.70% as of December 31, 2025, unchanged from both the previous quarter and the corresponding quarter of the previous year. This stability reflects the bank's emphasis on prudent underwriting standards, robust recovery mechanisms, and maintenance of a well-secured, diversified, and granular loan book that continues to demonstrate strong repayment behavior.

Deposit Growth and CASA Performance

Total deposits aggregated to ₹9,931 crores, registering impressive year-on-year growth of 18.50% and quarter-on-quarter growth of 6.60%. A notable improvement was observed in the CASA ratio, which increased to 35.90% as of December 31, 2025, from 33.90% as of September 30, 2025. This enhancement reflects the bank's sustained focus on building a stable and cost-efficient deposit franchise.

Liquidity and Capital Ratios

The bank maintained healthy liquidity metrics during the quarter:

The average credit-to-deposit ratio for the quarter ended December 31, 2025, stood at 80.40%, compared to 81.60% in the previous quarter and 81.10% in the corresponding quarter of the previous year. The Liquidity Coverage Ratio stood at 215.82%, which, along with higher capital adequacy ratios, provides sufficient room for future growth initiatives.

The financial data presented is provisional and subject to limited review by statutory auditors and approval from the Audit Committee and Board of Directors.

Capital Small Finance Bank has taken a significant step to enhance employee engagement and ownership by allotting equity shares under its Employee Stock Option Plan (ESOP) 2023. This move not only rewards employees but also strengthens the bank's capital base.

Key Details of the Allotment

Impact on Share Capital

The allotment has led to an increase in the bank's paid-up equity share capital:

*Note: Pre-allotment figures are calculated based on the change in share capital.

Significance of the ESOP Allotment

1. Employee Motivation: By offering equity ownership, Capital Small Finance Bank aims to align employee interests with the bank's long-term success.

2. Retention Tool: ESOPs serve as an effective mechanism to retain talent, especially in the competitive banking sector.

3. Capital Enhancement: The allotment contributes to strengthening the bank's capital structure.

4. Regulatory Compliance: The bank has adhered to regulatory requirements by promptly disclosing the allotment details to the stock exchanges.

This equity allotment under the ESOP scheme demonstrates Capital Small Finance Bank's commitment to fostering a culture of ownership among its employees while simultaneously bolstering its financial position. As the banking sector continues to evolve, such initiatives may play a crucial role in attracting and retaining top talent.