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Informist, Friday, Jul. 17, 2026

 

--RBL Bank: Our current focus is to grow retail deposits 
--RBL Bank: See sharp reduction in slippages in credit card portfolio 

--RBL Bank: Expect wholesale loan portfolio to grow in near term 

--RBL Bank: Expect our RoA to be at 1% in Q2 

 

By Vaishali Tyagi

 

NEW DELHI – RBL Bank is targeting a return on assets of 1% in the Jul-Sept quarter and expects return on equity to be in "double-digits" in the near term, the management said in a post-earnings analyst call on Friday. The bank said it will work toward achieving both return on assets and return on equity targets. The bank's return on assets was 0.57% as on Jun. 30, marginally up from 0.55% at the end of March quarter, while its RoE stands at 4.01%  significantly down from 5.69% from March quarter and 5.11% from Jun. 30, 2025. 

 

"Normally, we don't give the guidance on ROEs...we said that we make an aspirational effort for increasing it (return on equity) to double digits in the Q2 (Jul-Sept) and that's what we are working on," the management said. "So, ..I think we should start seeing the full impact of capital in the current quarter...we should start seeing the 1% number (for return on assets) in a near term, and I think we should get better than that by the time we exit the year."

 

The lender released its earnings after market hours. On Friday, shares of the company closed 1.5% higher at INR 368.10 on the National Stock Exchange. The private sector bank's net profit grew about 27% on year to INR 2.54 billion. On quarterly, the bottom line rose over 10%. Its total income rose over 6% on year to nearly INR 48 billion in the reporting period.

 

The bank said it expects a sharp reduction in credit card slippages in the near term. Slippages and credit costs in the cards portfolio have been elevated over the last two quarters, an early indicator of delinquency trends. "We have been transparent in guiding that we expect elevated slippages in cards in H2 (Oct-Mar). We are now more confident of a sharp decline in the quantum of slippages from Oct-Dec onward," the management said. "We did see some marginal reduction (Apr-Jun) and we should see some more reduction in Q2 (Jul-Sept) also."

 

The bank's net slippage ratio rose to 0.69% in the June quarter from 0.61% in the March quarter. The gross slippages ratio, however, declined to 0.83% from 0.9% sequentially. Net slippages in the credit cards and personal loans segment increased to INR 7.07 billion from INR 5.80 billion in Jan-Mar.

 

The bank's management said it expects growth in the wholesale lending portfolio. At the same time, the overall mix will continue to tilt toward more secured retail loans. "We will also move up the risk curve in wholesale lending to better-rated corporates, and in mortgages to both better business loans and individuals," the management said. 

 

The bank's advances rose 23% year-on-year to INR 11.62 billion in June quarter. The retail to wholesale mix stood at 55:45 as on Jun. 30. Secured retail advances accounted for 57% of total retail advances. The wholesale advances rose 38% on year to INR 520.27 billion, while retail advances grew 13% to INR 641.96 billion in the reporting quarter.

 

On the deposits front, the bank' managment said it has been focusing on retail deposits over the last two years. It is growing retail term deposits at 23-24% and will look to maintain at least that market share going forward, the management added, "it will go up depending on how this demand ultimately concludes." The bank's overall average deposits rose by 24% on year to INR 12.94 billion in the quarter ended June and average current account savings accounts deposits grew 11% on year at INR 326 billion. 

 

Further, the bank's management said it will be in a position to mobilise more deposits in next two quarters. The lender also expects to benefit from lower rates on corporate deposits, which should support growth. On foreign currency non-resident bank deposits deposits, the management said it does not have a fixed target. The bank's current market share in FCNR is around 0.5%. It aims to grow this 2-3 times to about 2% of market share. RBL Bank has raised $150 million through foreign currency non-resident bank deposits so far, the bank's top official said during post-earnings press conference earlier in the day. 

 

Indian banks and certain foreign lenders have increased interest rates on dollar deposits under the FCNR(B) scheme by over 300 basis points in some cases after the Reserve Bank of India launched the scheme as the RBI's swap window allows them to price these deposits on a par with domestic liabilities. The regulator did away with caps on offering deposit rates in June, which was seen as a push to maximise inflows.  End

 

US$1 = INR 96.2800

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Vaishali Tyagi and Gunjan Rajput

Edited by Deepshikha Bhardwaj

 

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