Deposit growth lagging loan growth
Deposit growth was only 1% QoQ vs loan growth of 19.45% YoY, leading to a CD ratio above 85%. Management aims to close the gap but faces competitive pressure.
high · analyst_questionThe Federal Bank Limited — Q2 FY25
Federal Bank reported a record net profit of INR 1,057 crore (+10.79% YoY) and NII of INR 2,367 crore (+15.11% YoY) in Q2 FY25.
neutral
medium
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Risk Intelligence
Material risks this quarter
Concise cards keep the risk register scannable while preserving evidence-level context in the underlying quarter data.
Risks
MFI portfolio stress
MFI slippages have increased, though management claims they are below industry levels due to conservative underwriting and geographic concentration in southern states.
medium · analyst_questionNIM pressure from penal charge reclassification and rate cuts
NIM was impacted by 7bps due to penal charge reclassification. Potential rate cuts could further pressure margins, though management expects underlying NIM improvement.
medium · data_observationCredit card embargo resolution timeline uncertain
RBI embargo on co-brand credit card reissuance remains unresolved. Management expects to approach RBI soon for one model, but other models may take longer.
medium · analyst_question