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Informist, Monday, Apr. 20, 2026

NEW DELHI/MUMBAI – Bank of Maharashtra plans to mobilise low-cost deposits, including current account and savings account deposits, to achieve 18% credit growth in 2026-27 (Apr-Mar), Managing Director and Chief Executive Officer Nidhu Saxena said Monday. To mobilise deposits, the bank will be focusing on states where the Centre's development projects are being announced, and higher allocations are being made, including the 16th Finance Commission's allocations. 

"...these are the focus states where we are seeing a lot of allocations in terms of central scheme allocations that are coming, and we are engaging with the new kitty or raw material that is forming in these states," Saxena said in a post-earnings press conference. "We are also focusing on new branch opening in these states, which has organically come as an outcome of a very scientific exercise that identifies the potential growth centres of the country and matches it with our presence where the gaps are, and we are growing as a truly nationally present bank," he said. 

When asked about the specifics of which states the bank was focusing on, Saxena said he would "like to keep it as a trade secret." Saxena projected the bank's total business growth in FY27 at 16-17%, with an advances growth of 18% and deposits growth of 14-15%. 

The state-owned bank's total deposits grew 14% on year to INR 3.51 trillion at the end of March, while its global advances grew 22% on year to INR 2.92 trillion. Its net profit for the March quarter was INR 20.14 billion, up nearly 35% on year, the highest in the last four quarters. Shares of the bank closed at INR 75.54 on the National Stock Exchange, up 3.9% from the previous close.

Acknowledging the industry-wide concern of credit growth outpacing deposit growth, Saxena said that the Pune-based bank was also very much part of the system and is also experiencing a similar phenomenon, although it has strategies that will help in dealing with the situation. The bank will continue to focus on CASA deposits, and plans to maintain a CASA ratio of around 50% in FY27. At the end of March, Bank of Maharashtra's CASA ratio was 52.51%, slightly lower than 53.28% end of March 2025. 

"I am not out of the system. When the industry goes down from 44% to 36%, it is almost 6% decline, even lower than that. You will find many banks are now experiencing a further dip in CASA," he said. "So we are going to have CASA guidance for this year of around 50%, which is again a good number to maintain."

Saxena also said that beyond mobilising deposits, the bank will also consider other fundraising plans to be able to fuel robust credit growth in FY27. "We have been strategically exploring other areas, other ways and means to raise resources for funding this credit growth," he said. In the last two fiscals, the bank raised funds through the qualified institutional placement route and through the government lowering its stake via offer for sale. "That fundraising was deployed to fund the credit growth," the bank's chief said, adding that the bank was "adequately capitalised as of now."

The bank's capital adequacy ratio at the end of March was 18.36% and in FY27, the bank aims to maintain it at around 18%. 

Despite the healthy capital adequacy, the bank is open to fund-raising in FY27 if the cost and time permit to boost credit growth. The bank's board Monday approved the plan to raise INR 100 billion through infrastructure bonds, INR 75 billion through QIP, follow-on public offer, among others, and $500 million through foreign currency bonds. "..at the opportune time, we can look at it in terms of pricing and raise resources," he said. 

Elaborating further, he said that while raising funds through green bonds was also an option, there are not enough incentives to do it currently. However, he said some incentive-related discussions may be in the offing at a higher level, which will nudge the bank to explore the instrument too. "So, green bond, we don't find any incentive as such...But I think maybe some discussions are there, and some new things are coming. We will try to explore that option also," he said. 

Going for the right instruments and timing the fundraising plan appropriately will also help the bank maintain healthy margins, the managing director added. He projected the net interest margin at 3.75% at the end of March 2027, slightly lower than 3.91% end of March 2026, and 4.01% end of March 2025. 

Going forward, he said that the bank aims to also focus on fee-based income and non-interest income to support its bottom line. "We have created a lot of things that are going to help the field functionaries start generating higher fee-based non-interest income. And this is one component where we see a lot of scope to do more in the bank."

On asked whether the bank expects any impact from the West Asia war, Saxena said that the bank is "mindful" of the developments and the impact it can have on the bank's loan book and asset quality. "But there could be an impact also, which is not immediately going to be seen, but we will see it in the next quarter (Apr-Jun)," he said.

The war in West Asia, which began on Feb. 28, has increased India's exposure to energy and price shocks, given New Delhi's dependence on the region for crude oil and liquefied petroleum gas supplies. Crude oil prices, a key determinant of government subsidies, have soared since the war broke out. With a potential second-order impact on trade, manufacturing, and other sectors, small borrowers may see pressure in repaying loans, thereby increasing the chances of them turning into bad loans.

Having said that, he said that the bank's gross non-performing assets ratio at the end of FY27 is expected to be less than 2%, higher than the levels seen in the last two fiscals. At the end of March, the gross NPA ratio was 1.45%, lower than 1.74% at the end of March 2025 and 1.88% end of March 2024. He also said that the net NPA is expected to be less than 0.25% in FY27, as against the sub-0.20% net NPA seen since March 2024. At the end of March, the bank's net NPA was 0.13%.  End

Reported by Priyasmita Dutta and Durgesh Nandan

Edited by Akul Nishant Akhoury

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