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Ujjivan Small Finance Bank Ltd. (BSE: 542904; NSE: UJJIVANSFB) announced robust financial results for the quarter ended September 2025 (Q2 FY26), showcasing healthy growth across key business segments, improved asset quality, and enhanced profitability.
Business Highlights
Deposits:
Total deposits rose 15.1% year-on-year (YoY) to ₹39,211 crore as of September 2025. The Current Account Savings Account (CASA) deposits grew 22.1% YoY to ₹10,783 crore, taking the CASA ratio to 27.5%. The cost of funds improved to 7.3% from 7.6% in the previous quarter, aided by proactive rate adjustments across savings and term deposits.
Assets:
The bank recorded its highest-ever disbursements at ₹7,932 crore, marking a 47.6% YoY and 21.3% quarter-on-quarter (QoQ) growth. The gross loan book stood at ₹34,588 crore, up 14% YoY and 3.9% QoQ. The share of secured loans increased significantly to 46.8%, compared to 34.9% a year earlier. Micro Banking disbursements rose 29.3% YoY to ₹4,259 crore, with the micro banking portfolio touching ₹18,570 crore.
Collection & Asset Quality:
Asset quality showed improvement with GNPA and NNPA ratios declining to 2.45% and 0.67%, respectively, while the Provision Coverage Ratio stood at 73%. The overall Portfolio at Risk (PAR) reduced to 4.45%. Collection efficiency remained strong at 99.5%, and the SMA portfolio dropped to its lowest level since Q1 FY25 at 1.99%.
Financial Performance:
Profit After Tax (PAT) for Q2 FY26 rose 18.2% QoQ to ₹122 crore. Pre-Provision Operating Profit (PPoP) grew 9.6% QoQ to ₹395 crore, and Net Interest Income (NII) increased 7.7% QoQ to ₹922 crore — reversing a three-quarter downward trend. The bank reported a Return on Assets (RoA) of 1.0% and Return on Equity (RoE) of 7.7% for the quarter.
Capital Position:
Ujjivan maintained a strong capital base, with a Capital Adequacy Ratio (CAR) of 21.4% and Tier I capital at 19.9%.
Management Commentary
Sanjeev Nautiyal, MD & CEO of Ujjivan Small Finance Bank, said,
“We have delivered well-calibrated growth this quarter by optimizing liquidity, taking our Credit-Deposit ratio to 88.2%. CASA grew by 22.1% YoY, supported by our ongoing efforts to enhance retail deposit mobilization. We have also seen improvement in cost of funds, which we expect to sustain in the coming quarters.
Our strong disbursement momentum and increasing share of secured lending are driving portfolio diversification. The microfinance segment continues to stabilize, reflecting improved repayment behaviour and strong collection efficiency.
With strategic branch expansion and product diversification, we are confident of achieving around 20% growth in advances for FY26 while maintaining credit costs in the range of 2.3–2.4% of the gross loan book.”
Outlook
With a stable deposit base, rising CASA, and continued focus on secured lending, Ujjivan Small Finance Bank remains well-positioned to sustain its growth trajectory in FY26, supported by expanding product offerings including mutual fund distribution, forex services, and ASBA rollout in the upcoming quarters.