ESAF Small Finance Bank Completes Postal Ballot with All Resolutions Approved

ESAF Small Finance Bank has successfully concluded its postal ballot process with all four proposed resolutions receiving overwhelming shareholder approval. The bank announced the results on December 12, 2025, following the completion of remote e-voting.

Postal Ballot Results Overview

The voting process concluded with strong shareholder participation, as detailed in the scrutinizer's report:

Parameter:	Details
Total Shareholders on Record:	1,15,253
Voting Period:	November 13 - December 12, 2025
E-voting Platform:	CDSL ( www.evotingindia.com )
Scrutinizer:	N. Balasubramanian, Practising Company Secretary

Resolution-wise Voting Results

All four resolutions were passed with requisite majority:

Resolution:	Type	Votes in Favour	Votes Against	Result
Capital Increase	Ordinary	99.96%	0.04%	Passed
Karthikeyan Manickam Appointment	Special	99.93%	0.07%	Passed
Ranjani Re-appointment	Special	99.93%	0.07%	Passed
Ajay Sharma Appointment	Special	99.99%	0.01%	Passed

Approved Resolutions

Capital Structure Enhancement: Shareholders approved the increase in authorized share capital from ₹600.00 crore to ₹1,000.00 crore by creating an additional 40 crore equity shares of ₹10.00 each. This move strengthens the bank's capital adequacy position and supports future growth objectives.

Board Appointments: Three key board-level appointments received approval:

Karthikeyan Manickam as Non-Executive Independent Director and Part-Time Chairman, effective December 21, 2025, for a three-year term with fixed remuneration of ₹20.00 lakh per annum
Ms. Kolasseril Chandramohanan Ranjani re-appointed as Non-Executive Independent Director for another three-year term from December 13, 2025
Ajay Sharma appointed as Non-Executive Independent Director for a three-year term starting December 21, 2025

Regulatory Compliance

The postal ballot process was conducted in compliance with Sections 108 and 110 of the Companies Act, 2013, and SEBI Listing Regulations. Pursuant to Section 12(2) of the Banking Regulation Act, 1949, and RBI guidelines, promoter voting rights were restricted to 26% of total voting rights.

The results have been displayed at the bank's registered office, website ( www.esaf.bank.in ), and filed with BSE and NSE. These approved changes position ESAF Small Finance Bank for enhanced governance structure and future growth initiatives.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+1.42%	-0.38%	-1.71%	-18.24%	-33.66%	-61.69%

ESAF Small Finance Bank , a prominent player in India's small finance banking sector, has reported its financial results for the second quarter and first half, revealing a strategic shift towards secured lending amidst challenging market conditions.

Financial Performance

The bank reported a net loss of ₹197.00 crores for H1, compared to a loss of ₹521.00 crores in the previous fiscal year. This improvement in the bottom line comes despite headwinds in the banking sector.

For Q2, ESAF Small Finance Bank posted a net loss of ₹115.81 crores, narrowing from a loss of ₹190.07 crores in the corresponding quarter of the previous year.

Growth in Advances and Deposits

Despite the losses, the bank demonstrated resilience in its core business:

Gross advances grew 4.3% year-on-year to ₹19,137.00 crores
Deposits increased 5.9% to ₹22,894.00 crores

Strategic Shift to Secured Lending

A significant development is the bank's strategic pivot towards secured loans:

Secured loans now comprise 86% of the portfolio, up from 61% previously
This shift aims to improve asset quality and reduce risk

CASA Growth and Deposit Profile

The bank reported strong growth in its low-cost deposits:

CASA deposits grew 13.7% to ₹6,046.00 crores
CASA ratio improved to 26.4% from 24.6% last year
Retail deposits now constitute 96% of total deposits, up from 93% previously

Asset Quality and Capital Adequacy

Asset quality metrics showed mixed trends:

Gross Non-Performing Assets (GNPA) ratio stood at 6.9%
Net Non-Performing Assets (NNPA) ratio was 3.8%

The bank maintains a strong capital position:

Capital Adequacy Ratio: 22.4%
Tier I Capital Ratio: 16.9%

Key Financial Metrics

Metric	H1 Value
Net Interest Margin	5.9%
Cost-to-Income Ratio	77.9%
Return on Assets	-0.74%
Return on Equity	-21.4%

Operational Highlights

ESAF Small Finance Bank continues to expand its reach:

Operating through 788 banking outlets
Presence across 24 states and 2 Union Territories
Serving 97.8 lakh customers
Focus on rural and semi-urban markets

Management Commentary

Kadambelil Paul Thomas, Managing Director & CEO, commented on the results: "The consistent growth in our business and the healthy rise in CASA deposits reflect the deep and enduring trust our customers place in ESAF Bank. Our secured portfolio continues to gain strong traction, driven by growth in gold, mobility, Agri and mortgage loans. These pillars position us well for sustained, quality-led expansion."

The bank's strategic shift towards secured lending, coupled with its strong deposit franchise and capital position, suggests a focus on building a more resilient business model. While the current financial performance shows challenges, the bank's efforts to improve asset quality and expand its secured loan portfolio may pave the way for improved profitability in the future.

Investors and stakeholders will likely keep a close eye on how these strategic initiatives translate into financial performance in the coming quarters.