Federal Bank stock in focus after record Q2 profit of INR 1,386 crore
Published on 11/01/2026 at 01:09 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWSFederal Bank strengthens quarterly performance
- Net interest income and fee income advanced strongly in the second quarter.
- Gross and net non-performing loans reached their lowest levels in a decade.
- Deposits and advances both expanded at double-digit rates year over year.
Federal Bank reported record quarterly earnings on Friday, October 16, 2026, as net profit for the quarter ended September 30 reached INR 1,386.09 crore. The result was up 45.10% from the year-earlier period, according to the bank's official Q2 FY27 release.
Core income drives record result
Net interest income rose 26.38% year over year to INR 3,153.40 crore, while fee income increased 31.86% to INR 1,167.71 crore. Net interest margin expanded by 26 basis points to 3.32%, and operating profit climbed 35.35% to INR 2,225.37 crore.
Other income reached a record INR 1,490.44 crore, an increase of 37.73%. The bank said its cost of funds fell 40 basis points year over year, while the cost of deposits declined 39 basis points to 5.18%.
Asset quality reaches decade lows
Gross non-performing assets declined to 1.32% and net non-performing assets to 0.17%. Both ratios were at decade lows, while fresh slippages fell 27.48% year over year and credit cost declined to 0.31%.
The balance sheet also expanded. Deposits rose 18.61% to INR 3,42,693.56 crore and gross advances increased 21.66% to INR 3,01,687.80 crore. The total business franchise exceeded INR 6.4 lakh crore, while the current account and savings account ratio improved to 32.04%.
Business model and market position
Federal Bank is an Indian commercial bank headquartered in Aluva, Kerala. Its offering spans deposits, current and savings accounts, credit cards, personal, home, vehicle, gold and property loans, as well as business and corporate banking. The bank focuses on retail, commercial and corporate services, with additional non-resident banking activity and a nationwide branch network.
The bank added 12 branches during the quarter, taking its network to 1,662 banking outlets. Its growth mix included gold loans, loans against property, credit cards and commercial banking, giving the lender a diversified position within India's private-sector banking market.
Federal Bank at a glance
- Company: The Federal Bank Limited
- ISIN: INE171A01029
- Exchange ticker: FEDERALBNK.NS
- Reporting period: Q2 FY27, quarter ended September 30, 2026
- Net profit: INR 1,386.09 crore
- Net interest margin: 3.32%
- Gross non-performing assets: 1.32%
- Net non-performing assets: 0.17%
The broader Indian equity market provides the wider setting for investors following private-sector lenders.
More earnings updates and company disclosures are available in more news and analyses on Federal Bank stock.
