Banking & Finance     

Published: October 31, 2026
Updated: October 31, 2026

Federal Bank

95 years old, and breaking new ground

Established in 1931 as Travancore Federal Bank, and known today as Federal Bank, the Aluva (Kerala)-based bank with 1,662 banking outlets has created a niche for itself and is, in fact, accelerating its pace of growth. The bank has delivered a record-breaking performance for the quarter ended September 30, 2026.

Its total business crossed a historic baseline milestone of Rs 6 lakh crore this half-year. Of the total deposits of Rs 3,42,694 crore, over Rs 1 lakh crore is CASA deposits. Gross advances crossed Rs 3 lakh crore, expanded by 22% YoY. NIM reached 3.32%, while improved asset quality helped in bringing down gross NPA to 1.32% and net NPA to 0.17%, both decadal lows, showcasing good risk management skills.

Net interest income grew 26.38% to Rs 3,153.40 crore, ahead of advances growth of 21.66%. Interestingly, other income reached the highest-ever level of Rs 1,490.44 crore, up 37.73% YoY, while fee income grew 31.86% to Rs 1167.71 crore. Operating profit grew 35.35% to Rs 2,225.37 crore. Net profit of Rs 1,386.09 crore has been the highest ever, up 45.10% YoY and 17.77% QoQ. Earnings per share rose 44.34% to Rs 22.26 on a Rs 2 face value scrip.

GROWTH WARRIORS

NR deposits (NRE and ONR) reached Rs 1,19,056 crore, up 26.63% and FCNR (B) deposits rose 239.14% YoY to Rs 2,3548 crore. Gold loans grew by 37.13% YoY. The cost-to-income ratio improved 196 bps YoY to 52.08%, RoA 1.32%, RoE 13.57%, book value per share to Rs 166.32, CRAR at 16.84% and Tier-I at 15.76%. Twelve new branches were opened during Q2, taking the total number of banking outlets to 1,662.

Krishnan Venkat Subramanian (KVS Manian), the present Managing Director and CEO, took over on September 23, 2024. He is a former Joint Managing Director of Kotak Mahindra Bank, where he spent over two and a half decades. His leadership has made a difference to the bank, as it has fuelled a further growth momentum together with a changed dimension, which can be measured through the bank’s improved performance and the rise in market capitalisation of the stock, which has increased from Rs 45,699 crore to Rs 85,562 crore currently; i.e., an appreciation of Rs 39,863 crore, or 87.23%.

MILESTONE QUARTER

Commenting on the performance, Mr Manian said, “This quarter marks several milestones for the bank: our highest-ever profit, our total business franchise at over Rs 6.4 lakh crore and advances crossing Rs 3 lakh crore. More importantly, the growth is coming from the core. Net interest income grew 26% and fee income 32%, and fee income relative to our earning assets is at an all-time high. Gross and net NPA are at their lowest levels in a decade, slippages are down 27%, and provision coverage stands at 87%. We are growing faster while keeping the quality of the book intact. Our chosen segments are delivering as intended, and the CASA and NR franchises continue to deepen. As the rate environment turns, we enter the second half of the year with a strong capital position, a granular balance sheet, and good momentum in our core business.”

BLACKSTONE ENTRY

The bank issued 27,29,74,043 share warrants on February 16, 2026 to Asia II Topco XIII Pte Ltd, an affiliate of Blackstone, @ Rs 227 per warrant comprising Rs 2 face value and a premium of Rs 225. The 25% up front payment of Rs 1,549.13 crore has been received, whereas the remaining 75% amounting to Rs 4,647 crore will be received at the time of exercising the conversion right within 18 months from the issue date. The investor will then hold a 9.99% stake in the bank and gain the right to nominate one non-executive director to the bank’s board, provided a minimum of 5% shareholding is maintained.

It is a measure of its sterling performance that Federal Bank, which was earlier counted among old-generation private sector banks, is now being recognised under the new-generation private sector banks category.

Federal Bank (Major Shareholders as on 30.09.2026)