Capital Small Finance Bank (CSFB) has reported robust financial results for the second quarter, showcasing steady growth across key business metrics. The bank also unveiled ambitious expansion plans, aiming to double its loan book to ₹16,000 crores by FY29.

Financial Highlights

CSFB demonstrated strong performance in Q2:

• Gross advances rose 17.7% year-on-year to ₹7,907.00 crore
• Deposits increased 19.8% year-on-year to ₹9,317.00 crore
• Profit After Tax (PAT) grew 4.6% year-on-year to ₹35.00 crore
• Return on Assets (RoA) improved to 1.3% from 1.2% in the previous quarter

The bank maintained a healthy asset quality with Gross Non-Performing Assets (GNPA) at 2.70% and Net Non-Performing Assets (NNPA) at 1.38%, showing a slight improvement from the previous quarter.

Key Financial Metrics

Growth Strategy and Future Outlook

Mr. Sarvjit Singh Samra, Managing Director & CEO of Capital Small Finance Bank, commented on the results: "The quarter ended September 30 was marked by healthy credit offtake and stable margins, reflecting the strength of our core operating model."

The bank has outlined an ambitious growth strategy, targeting to:

1. Double its loan book to ₹16,000+ crores by FY29
2. Expand its branch network to 300+ locations by FY29
3. Improve profitability metrics, aiming for a Return on Assets (RoA) of 1.6%+ by FY29

Expansion Plans

CSFB is focusing on expanding its presence beyond its core markets:

• Entering new states like Uttar Pradesh and Gujarat
• Intensifying penetration in current markets (Haryana, Punjab, Rajasthan & Delhi)
• Targeting 30%+ branches outside Punjab by 2029 (currently at 17.5%)

Business Focus

The bank continues to emphasize:

• Organic loan book growth in MSME, Mortgages, and Agriculture segments
• Maintaining a secured lending portfolio (currently at 99.2% secured loans)
• Elevating its retail-focused liability franchise
• Strengthening operational efficiency to enhance profitability

Capital Small Finance Bank's strong quarterly results and ambitious growth plans reflect its commitment to expanding its presence in the small finance banking sector while maintaining robust financial health and asset quality.

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.