Stock Report

Capital Small Finance Bank Registers 22% Advance Growth and Strengthening Asset Quality in Q1 Performance

Posted On : 2026-07-03 19:33:39( TIMEZONE : IST )

Capital Small Finance Bank Limited has released its key business updates for the first quarter ended June 30, 2026. The bank kicked off the new fiscal year on a strong footing, demonstrating robust year-on-year expansion across its loan book and retail deposit franchise alongside a steady improvement in asset quality.

Robust Growth in Secured Advances

The bank's gross advances reached ₹9,074 crores as of June 30, 2026, marking a healthy 22.0% year-on-year (YoY) growth compared to ₹7,437 crores in the same quarter last year. On a sequential basis, advances climbed 4.5% from the ₹8,687 crores recorded on March 31, 2026.

Disbursements: Total credit disbursements for the quarter rose to ₹1,009 crores, representing a 16.5% increase over the ₹865 crores disbursed in the first quarter of the previous fiscal year.

Portfolio Quality: In line with its retail-focused, conservative lending approach, Capital Small Finance Bank's loan book remains highly secure, with approximately 98% of all advances backed by collateral.

Asset Quality Strengthens Further

The bank recorded a consecutive reduction in its non-performing assets, reflecting disciplined underwriting standards and effective recovery systems. Gross Non-Performing Assets (NPAs) dropped to 2.47% of gross advances for the quarter ended June 30, 2026. This shows a steady improvement from the 2.54% reported in the trailing quarter (March 31, 2026) and a significant decline from the 2.75% posted in the same period last year (June 30, 2025).

Expanding Deposit Base Led by CASA Growth

Total deposits at Capital Small Finance Bank increased to ₹10,596 crores as of June 30, 2026, up 16.3% YoY from ₹9,110 crores and 5.8% quarter-on-quarter (QoQ) from ₹10,018 crores.

The bank's low-cost deposit franchise showed enhanced momentum, with the Current Account Savings Account (CASA) ratio rising to 36.7% as of June 30, 2026. This is a noticeable improvement compared to 34.7% as of March 31, 2026, and 35.9% as of June 30, 2025, underlining deeper customer engagement and a solidifying retail liability foundation.

Comfortable Liquidity and Credit-Deposit Ratio

Driven by robust daily outstanding credit deployment, the bank's average Credit-Deposit (CD) ratio for the quarter stood at 83.1%. This positions the bank slightly above the 82.3% average recorded in the preceding quarter and the 80.9% average seen in June 2025. Management indicated that the bank's liquidity position remains comfortable and well-capitalized, giving it adequate financial flexibility to accelerate future growth.

Note: The financial data presented in this report for the quarter ended June 30, 2026, is provisional and subject to a limited review by the bank's statutory auditors, as well as formal approval from the Audit Committee and Board of Directors.