ICICI Bank, YES Bank, RBL Bank shares plunge; here is why private banks are falling

Shares private sector lenders were leading the decline in markets on Monday, January 19. The measure of private sector lenders on the National Stock Exchange (NSE) fell as much as 0.77% or 223 points to hit an intraday low of 28,466.95 dragged down by losses in ICICI Bank, HDFC Bank, YES Bank, Bandhan Bank and IDFC First Bank.

Private sector lenders came under selling pressure after the country's second largest private sector lender ICICI Bank reported a decline in its net profit in the third quarter of current financial year.

ICICI Bank shares plunged as much as 3.6% to hit an intraday low of ₹1,360. The stock alone wiped out 263 points from the SENSEX, data from BSE showed.

ICICI Bank's net profit in December quarter declined 4% to ₹11,318 crore from ₹11,792 crore on account of Reserve Bank of India's led provisions on agriculture loans and implementation of new labour laws, global investment bank Jefferies noted.

Its net interest income (NII) surged 7.7% YoY to ₹21,932 crore during the quarter under review, compared to ₹20,371 crore in Q3 of the 2024-25 fiscal year (Q3FY25).

It clocked a net interest margin (NIM) of 4.3% in Q3 FY26, in comparison to 4.25% in the year-ago period. Sequentially, it remained unchanged.

Weaker than expected results posted by ICICI Bank had a rub off effect on other private sector lenders, analysts noted.

Market expert Avinash Gorakshakar added that the weak market sentiment due to announcement of 10% additional tariffs on European countries by United States also added to selling pressure across the sectors.

YES Bank Q3 earnings

YES Bank shares also declined as much as 3.2% to hit an intraday low of ₹22.71 despite reporting 55.42% year-on-year (YoY) jump in its standalone net profit to ₹951.62 crore. It had logged a profit of ₹612.27 crore in the same period of the previous fiscal year, the bank said in a regulatory filing.

The bank's net interest income (NII) stood at ₹2,465 crore during the quarter under review, marking a 10.8% annual increase from ₹2,223 crore in the December quarter of the 2024-25 fiscal year (Q3 FY25).

However, its total interest income for the quarter remained subdued at ₹7,543 crore as compared to ₹7,829 crore in the same period last year.

Its net interest margin (NIM) stood at 2.6% in the December FY26 quarter, up by 10 basis points (bps) quarter-on-quarter (QoQ) from 2.5% in the second quarter of the current fiscal year. On a YoY basis, it grew by 20 bps from 2.4% in Q3 FY25.

RBL Bank Q3 earnings

RBL Bank shares dropped as much as 8.45% to hit an intraday low of ₹297 after analysts flagged concerns about elevated credit costs.

The bank posted a multi-fold jump in the net profit for the quarter and an overall improvement in the asset quality.

The Kolhapur-based bank reported steady growth in the Q3FY26 interest income at 3.7% YoY and 4.7% sequentially. Similarly, the interest expenses for the quarter jumped slightly by 2.9% YoY and 2.6% QoQ. Consequently, the net interest income jumped 4.6% YoY to ₹1,657 crore as against ₹1,584 crore in the same period last year.

The bank posted a sharp jump of over 5x in the net profit at ₹213 crore in Q3FY26 as against ₹32 crore in the same period last year. The sharp jump was primarily due to 46% drop in the provisions for the quarter. Additionally, the net profit was also impacted by one-time expenses of ₹32 crore due to changes in wages under the new labour codes.

Further, the asset quality of the bank also improved substantially in the quarter, as the GNPA stood at 1.8% vs 2.9% in Q3FY25, and NNPA stood at 0.55%

As of 12:17 pm, NIFTY Private bank index traded 0.5% lower in line with the NIFTY50 index which was 0.54%.