Federal Bank Q4: Net profit rises to ₹1,030 cr, NIM improves over 3%; board recommends ₹2 per share dividend

The bank’s net interest income during the period grew 8.3% to ₹2,377.4 crore as against ₹2,195.2 crore year-on-year (YoY).

The net interest income (NII) is one of the key metrics to assess a banking or financial entity's financial performance.

Federal Banks’ gross non-performing asset (NPA) for the March quarter stood at ₹4,375.5 crore quarter-on-quarter (QoQ). In the last quarter, the gross NPA was at ₹4,553.3 crore.

Sequentially, the net NPA for the quarter was recorded at ₹1,040.4 crore as against ₹1,131.2 crore in Q3 FY25.

Supported by strategic initiatives, net interest margin (NIM) improved to 3.12% in Q4 FY25.

Commenting on the result, CEO and Managing Director KVS Manian said, “As we have consistently articulated, our focus remains on profitable growth—driven by sustainable, high-quality earnings aligned with long-term value creation. This quarter’s performance is a strong validation of that approach."

Federal Bank’s total deposits increased by 12.32% during the quarter, while total net advances also grew 12.15%.

For the quarter, the bank saw its highest-ever other income backed by strong fee income momentum. The banks’ total business reached ₹5.18 lakh crore.

As of March 31, 2025, the net worth of the bank increased 13.86% YoY to ₹33,121.64 crore from ₹29,089.41 crore.

"It has also been a transformative year for the bank, with several strategic initiatives beginning to deliver tangible outcomes. Notably, our focused efforts in mid-yield segments and current accounts have shown significant traction, with current account balances growing 35% YoY (27% QoQ) and a 19% growth in mid-yield segments,” said Manian.

Apart from this, the Board of Directors also recommended a dividend of 60% per equity share having a face value of ₹2 for FY25. The dividend will be paid after the approval of shareholders at the Annual General Meeting.

Amid Reserve Bank of India’s rate cuts, Manian further said, “Despite the prevailing rate cut environment, we have effectively navigated NIM pressures through strategic asset pricing, robust CASA growth, and the best asset quality seen in over a decade. At the same time, we have launched several high-impact initiatives within the franchise to further strengthen efficiency and future growth prospects.”

On Wednesday, shares of Federal Bank settled at ₹196.15 apiece on the National Stock Exchange, declining 3.57%.