Axis Bank , one of India's leading private sector banks, has taken a significant step towards enhancing shareholder rights for its Global Depositary Receipt (GDR) holders. On October 15, 2025, the bank's Board of Directors approved an Amended and Restated Deposit Agreement for its GDRs, introducing key changes that could reshape investor participation.

Voting Rights for GDR Holders

The most notable amendment to the agreement is the provision of voting rights to GDR holders. This move aligns with global best practices and potentially increases the attractiveness of Axis Bank's GDRs to international investors. However, these voting rights come with a crucial caveat: GDR holders must demonstrate compliance with Section 12B of the Banking Regulation Act, 1949, as well as applicable master directions and guidelines.

Regulatory Approval Pending

It's important to note that this board approval is subject to authorization from the Reserve Bank of India (RBI). This regulatory step is critical, given the sensitive nature of voting rights in the banking sector and the need to ensure compliance with India's banking laws.

Implications for Investors

The granting of voting rights to GDR holders, once approved by the RBI, could have several implications:

1. Enhanced Shareholder Engagement: GDR holders will have a more direct say in the bank's governance.
2. Increased Attractiveness: The GDRs may become more appealing to international investors seeking active participation.
3. Compliance Challenges: GDR holders will need to navigate the compliance requirements to exercise their voting rights.

Board Meeting Details

The board meeting where this decision was made lasted from 11:30 am to 6:50 pm IST, indicating the depth of discussions surrounding this significant change.

Market Impact

While it's too early to gauge the market reaction, this move could potentially impact Axis Bank's stock price and the trading of its GDRs. Investors and market analysts will be closely watching for the RBI's decision and any subsequent changes in GDR trading patterns.

Conclusion

Axis Bank's decision to amend its GDR agreement represents a progressive step towards empowering international investors. However, the real impact of this change will only be clear once regulatory approval is secured and the practical implications of the compliance requirements are better understood. Stakeholders should keep a close eye on further developments, particularly the RBI's response to this proposal.

Axis Bank , India's third-largest private sector lender, has set an ambitious goal to achieve steady double-digit growth in both deposits and loans, while also reporting growth in its second quarter results. The bank plans to leverage digital innovation and payment services as key drivers to boost revenue and improve return on equity.

Growth Strategy and Q2 Performance

Axis Bank's strategy focuses on digital innovation and payment services to drive growth. This aligns with their recent performance, as the bank has shown robust loan growth, with advances increasing by 12% year-over-year to ₹11,16,703.00 crores as of September 30.

The bank's CEO stated that recent RBI policies are expected to further boost credit growth. In response to RBI advice, the bank has added more funds for two crop loan variants, demonstrating its commitment to agricultural lending and focus on rural and semi-urban markets.

Asset Quality and Financial Highlights

During a recent RBI inspection, no issues were found in the bank's asset quality, reflecting prudent risk management practices. Key financial highlights include:

• Net Interest Income (NII) grew by 2% year-on-year to ₹13,745.00 crores
• Fee income increased by 10% year-on-year to ₹6,037.00 crores
• Operating profit stood at ₹10,413.00 crores, down 3% year-on-year
• Net profit decreased by 26% year-on-year to ₹5,090.00 crores

Deposit and Advances Growth

The bank reported strong growth in both deposits and advances:

Digital Banking and Customer Base

Axis Bank continues to strengthen its digital banking capabilities:

• Mobile banking transaction volumes grew by 22% year-on-year
• 97% of financial transactions by individual customers were digital in Q2
• The bank's customer base expanded to approximately 54 million

Capital Adequacy and Liquidity

The bank maintains a strong capital position with a Capital Adequacy Ratio (CAR) of 16.55% and a CET1 ratio of 14.43% as of September 30. The bank also holds excess SLR of ₹101,012.00 crores, ensuring ample liquidity.

Future Outlook and Strategic Moves

Axis Bank officials have indicated that bank margins may reach their lowest point in Q3 without additional rate cuts, suggesting potential pressure on profitability. The bank is also working on selling its stake in Axis Finance, with plans for it to transition into a top-tier NBFC and go public.

The bank expects minimal impact from the shift to Expected Credit Loss (ECL) provisioning, demonstrating confidence in its risk management practices.

Amitabh Chaudhry, MD & CEO of Axis Bank, commented: "This quarter, we continued to push ourselves as an institution to deliver meaningful progress. From enhancing digital safety to expanding access to credit and empowering entrepreneurs, our innovations are designed to serve real needs with precision and scale."

As Axis Bank pursues its goal of double-digit growth through digital innovation and payment services, it remains well-positioned for sustainable growth in the coming quarters, despite potential short-term margin pressures and ongoing global economic uncertainties.