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Key Points

Ujjivan Small Finance Bank experienced a significant 74.7% drop in net profit during Q4 of fiscal year 2025, primarily due to increased provisioning and reduced interest income. Despite the earnings decline, the bank demonstrated resilience with improved asset quality and a robust 20% year-on-year growth in total deposits. The bank's secured loan portfolio expanded, now representing 44% of its total loan book, and it recorded strong loan disbursements of Rs 7,440 crore. Following the financial results, the bank's stock price experienced a modest decline on the National Stock Exchange.

Key Points: Ujjivan SFB Profits Plunge 74.7% Despite Strong Deposit Growth

  • Quarterly net profit drops 74.7% to Rs 83.4 crore
  • Deposits grow 20% to Rs 37,630 crore
  • Gross loan book increases 5% to Rs 32,122 crore
  • Asset quality improves with lower NPAs
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Ujjivan Small Finance Bank reports 74.7 pc net profit drop in Q4, NII down 7.4 pc

Ujjivan Small Finance Bank reports sharp Q4 net profit decline, improved asset quality, and 20% deposit growth amid challenging financial landscape

"Provision Coverage Ratio remained strong at 78 percent - Ujjivan SFB Financial Report"

Mumbai, April 30

Ujjivan Small Finance Bank (SFB) on Wednesday reported a 74.7 per cent sharp decline in its net profit at Rs 83.4 crore for the fourth quarter (Q4) of FY25, compared to Rs 329.6 crore in the same quarter last fiscal.

This decline in earnings was mainly due to increased provisioning and a slowdown in interest income, caused by changes in the bank’s business mix.

In the fourth quarter, Ujjivan SFB’s Net Interest Income (NII) came in at Rs 864.4 crore, down 7.4 per cent from Rs 933.5 crore in the same period a year ago.

However, the bank's asset quality showed improvement on a quarter-on-quarter (QoQ) basis, as per its stock exchange filing.

The Gross Non-Performing Assets (GNPA) dropped to 2.18 per cent from 2.68 per cent in the previous quarter, and the Net NPA also improved to 0.49 per cent from 0.56 per cent.

The bank’s Provision Coverage Ratio (PCR) remained strong at 78 per cent, backed by accelerated provisioning of Rs 46 crore during the quarter.

PCR is an important financial indicator for banks, reflecting their ability to cover potential losses from non-performing loans.

Additionally, Ujjivan SFB saw healthy growth in its deposits. Total deposits rose by 20 per cent year-on-year (YoY), reaching Rs 37,630 crore.

The bank also recorded strong growth in its CASA (Current Account Savings Account) ratio, which improved to 25.5 per cent, up 43 basis points from the previous quarter.

The gross loan book increased to Rs 32,122 crore -- a 5 per cent rise from the previous quarter and an 8 per cent increase from the same period previous fiscal.

One of the key highlights for the bank was the growth in its secured loan portfolio, which now constitutes 44 per cent of the total loan book, up from 30 per cent during a year-ago period.

Ujjivan SFB also set a record in loan disbursements, with Rs 7,440 crore disbursed in Q4 -- a 39 per cent QoQ growth. This was driven by a strong performance in micro-banking and individual loan segments.

Following the result declaration, the shares of the small finance bank was down by over 3 per cent to Rs 42.56 on the National Stock Exchange (NSE) on Wednesday.

- IANS

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Reader Comments

R
Rahul K.
Such a steep profit drop is concerning, but at least asset quality is improving. Small finance banks play crucial role in financial inclusion - hope they bounce back soon. The deposit growth shows customers still trust them. 🤞
P
Priya M.
Mixed bag results. While profits are down, the secured loan portfolio growth to 44% is a positive sign. Shows they're becoming more risk-averse. But 3% share drop reflects market nervousness - investors want consistent performance.
A
Arjun S.
RBI should keep closer watch on SFBs. When profits fall this sharply despite good loan growth, it raises questions about their business model. Maybe too much focus on quantity over quality of loans? CASA improvement is silver lining though.
S
Sunita R.
As a Ujjivan customer, I'm happy with their services. These quarterly ups and downs happen in banking sector. What matters is they're maintaining good asset quality and growing deposits. My chhoti si FD is safe with them! 😊
V
Vikram J.
The 39% QoQ loan disbursement growth is impressive! Shows they're reaching more customers. But NII decline suggests they might be compromising on margins. Need to find right balance between growth and profitability. Long-term sustainability matters.

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