Bandhan Bank has announced a customer-friendly policy change that will reduce the financial burden on savings account holders. The bank will lower the Monthly Average Balance (MAB) requirement for its Standard Savings Account from ₹5,000 to ₹2,000, effective February 1, 2026.

Policy Change Details

The revision represents a 60% reduction in the minimum balance requirement, providing significant relief to customers who previously struggled to maintain the higher threshold. Monthly Average Balance refers to the average amount maintained in an account over a month, calculated by averaging the end-of-day balances across all days in the month. Banks typically levy charges if the maintained average falls below the prescribed threshold.

Interest Rate Structure

Bandhan Bank continues to offer a comprehensive tiered interest rate structure on domestic and non-resident rupee savings deposits. As per the interest rate chart effective December 25, 2025, interest on savings accounts is calculated daily on the basis of end-of-day clear balances and credited at quarterly intervals.

High-Value Deposit Rates

For larger deposits, the bank offers even more attractive rates. Balances exceeding ₹250 crore have specific rate structures, with deposits above ₹250 crore up to ₹500 crore earning 6.15% per annum on the balance above ₹1 lakh. Balances above ₹500 crore up to ₹750 crore earn 6.85%, representing one of the highest rates in the structure.

For balances above ₹750 crore up to ₹1,000 crore, the interest rate is uniquely linked to the overnight Mumbai Interbank Offered Rate (MIBOR) plus 0.85%. Balances exceeding ₹1,000 crore earn 6.15% per annum on the balance above ₹1 lakh.

Customer Impact

This policy change demonstrates Bandhan Bank's commitment to making banking services more accessible to a broader customer base. By reducing the minimum balance requirement by ₹3,000, the bank is likely to attract new customers while providing existing account holders with greater flexibility in managing their finances. The change will be particularly beneficial for customers who previously faced non-maintenance charges due to inability to maintain the higher balance requirement.

Bandhan Bank shares experienced a significant rally of 6% on January 23, 2026, reaching a one-month high of Rs 151.25 following the release of its third-quarter results for FY26. Despite reporting a substantial decline in net profit, the stock attracted positive attention from brokerages who remain optimistic about the bank's recovery trajectory and improved operational metrics.

Q3 FY26 Financial Performance

Bandhan Bank's Q3 FY26 results presented a mixed picture with contrasting year-on-year and sequential performance trends. The bank's financial metrics for the quarter revealed both challenges and recovery signs.

*Calculated based on reported percentage change

The most notable improvement came in asset quality, with the gross NPA ratio declining significantly to 3.33% in Q3 FY26 from 4.68% in the corresponding quarter of the previous year and 5.02% in the preceding quarter.

Balance Sheet Growth and Deposits

The bank demonstrated steady growth in its core business metrics despite profitability challenges. Deposits expanded by 11% year-on-year to Rs 1.57 lakh crore, while gross advances grew 10% YoY to Rs 1.45 lakh crore. This growth trajectory indicates sustained business momentum and customer confidence in the bank's services.

Brokerage Upgrades and Target Prices

Several prominent brokerages revised their ratings and target prices upward, reflecting confidence in the bank's recovery potential despite near-term challenges.

Recovery Outlook and Key Positives

Motilal Oswal highlighted that Bandhan Bank has undergone a prolonged NPA cycle that significantly impacted its growth and profitability profile, resulting in a tepid 8% average return on equity over the past five years. However, the brokerage expects the bank's operating performance to recover in coming quarters, with asset quality regaining normalcy and margins stabilizing.

JM Financial noted that despite the net profit missing estimates due to elevated credit costs, the current valuation of 0.7x FY28 price-to-book ratio suggests limited downside potential. CLSA emphasized that the bank's margin remained largely stable, providing relief after two quarters of sharp decline, while AUM growth picked up to 8% YoY from 6% YoY.

Market Response and Valuation

The positive market response, with shares jumping 6% from the previous closing price of Rs 142.46, reflects investor confidence in the bank's turnaround story. The rally brought the stock to Rs 151.25, its highest level in a month, suggesting renewed interest from market participants who view the improved asset quality metrics and brokerage upgrades as positive catalysts for future performance.