Equitas Small Finance Bank Advances Hit ₹47,653 Crore in Strong Q1 Performance

Equitas Small Finance Bank Limited has released its provisional operational update for the first quarter of the 2026-27 financial year ended June 30, 2026. The bank reported high double-digit annual growth in credit expanding across its core lending books, alongside steady deposit mobilization.

Advances Expand on Surge in Core Disbursements

The bank's Gross Advances reached ₹47,653 crore for the quarter ended June 30, 2026. This reflects an annual growth of 26.70% compared to the un-audited gross advances of ₹37,610 crore recorded in the corresponding period of the previous fiscal year. Sequentially, gross advances saw an increase of 3.22% over the audited figure of ₹46,165 crore logged at the close of March 2026.

The primary catalyst for this loan expansion was a surge in quarterly credit disbursements, which stood at approximately ₹6,804 crore. This represents an annual increase of 93.77%, though it shows a sequential moderation of 7.39% compared to the fourth quarter of the preceding fiscal year.

The gross advances portfolio for the quarter includes an Inter-Bank Participation Certificate (IBPC), securitized, and assigned portfolio totaling ₹2,126 crore, down from ₹2,585 crore as of March 31, 2026. Additionally, the microfinance and micro loans segment incorporates outstanding Direct Assignment (DA) agriculture assets worth ₹837 crore purchased from other regulated entities back in the third quarter of FY26. If this outstanding DA portfolio is excluded from the calculation, the bank's overall gross advances grew by 24.48% year-on-year and 3.86% quarter-on-quarter.

A segment-wise breakdown reveals that microfinance and micro loans reached ₹6,019 crore during the current quarter, surging 70.19% year-on-year and growing 4.57% sequentially. Non-micro loans advanced 22.19% annually and 3.03% sequentially to close at ₹41,634 crore. In terms of product composition, unsecured microfinance and micro loans account for 13% of the bank's total advances mix when including the DA portfolio (and 11% when excluding it), while all other loan products comprise the remaining 87% (or 89% excluding DA).

Total Deposits Near ₹49,000 Crore Milestone

On the liabilities side, Equitas Small Finance Bank expanded its deposit franchise to reach ₹48,976 crore as of June 30, 2026. This performance marks a year-on-year growth of 10.44% against the ₹44,345 crore posted in June 2025, and a sequential gain of 5.25% above the ₹46,533 crore recorded in March 2026.

The bank's Current Account Savings Account (CASA) balances closed at ₹12,307 crore, reflecting a sequential increase of 0.89% over the ₹12,198 crore recorded in March 2026. On an annual basis, the CASA balance shows a decline of 5.47% compared to the ₹13,019 crore posted in June 2025. However, the bank clarified that the previous year's June balance was heavily inflated by high-value Applications Supported by Blocked Amount (ASBA) account holdings to the tune of ₹959 crore. When normalizing the data by removing those temporary ASBA funds, the bank's core CASA portfolio actually achieved an annual growth of approximately 2%.

The aggregate CASA ratio for the provisional quarter ended June 2026 settled at 25%, shifting from 29% in June 2025 and 26% in March 2026. In tandem with shifting deposit patterns, the bank's average cost of funds was pinned at 7.05% for the quarter, rising slightly from 6.94% in the sequential quarter but down from the 7.49% baseline recorded in the prior year's opening quarter.

Credit-Deposit Metrics and External Audit Reviews

The bank's overall Credit-Deposit (CD) ratio was reported at 92.96% for the quarter ended June 30, 2026. This metric shows a marginal reduction from the audited level of 93.65% maintained at the close of March 2026, but is higher than the 79.91% recorded in June 2025. After factoring out refinance borrowings from the total advances base, the adjusted CD ratio drops down to 81.28% for the current quarter, compared to 83.40% quarter-on-quarter and 76.48% year-on-year.

The bank, through Company Secretary N Ramanathan, highlighted that all operational parameters and baseline numbers reported for June 30, 2026, remain strictly provisional. The financial metrics remain subject to a standard limited review by the bank's Joint Statutory Auditors, alongside final administrative approval from the Audit Committee and Board of Directors.

Shares of Equitas Small Finance Bank Limited was last trading in BSE at Rs. 76.33 as compared to the previous close of Rs. 77.31. The total number of shares traded during the day was 94679 in over 579 trades.

The stock hit an intraday high of Rs. 78.69 and intraday low of 75.69. The net turnover during the day was Rs. 7284642.00.

Source : Equity Bulls

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EquitasSmallFinanceBank INE063P01018 Q1FY27 BusinessUpdate