HDFC Bank Q1 results: Net profit up 12.2% Y-o-Y to Rs 18,155 crore

Bank's provisions in the quarter jumps to Rs 14,441 crore as it made floating as well as additional contingency provisions

HDFC Bank, India’s largest private sector lender, has reported a 12.2 per cent year-on-year (Y-o-Y) increase in net profit to Rs 18,155 crore in the April-June quarter of the financial year 2025-26 (Q1FY26), despite a significant jump in provisions in the quarter, and modest growth in net interest income (NII) due to subdued loan growth. 

 

The bank’s partial disinvestment in subsidiary HDB Financial Services during the quarter aided to the net profit. It received a net gain of Rs 6,949.27 crore on account of the sale of shares of HDB Financial.

 

Its provisions jumped to Rs 14,441 crore in the quarter, which includes Rs 9,000 crore of floating provisions, and Rs 1,700 crore of additional contingent provisions. 

 

 

“The bank's credit performance across all segments continues to remain steady, in a credit environment that remains benign. The bank has considered this as an opportune stage to enhance its floating provisions, which are not specific to any portfolio, nor meant for any specific anticipated risks, but act as a countercyclical buffer for making the balance sheet more resilient”, the lender said in its statement on Saturday.

 

The lender’s NII during the period grew 5.4 per cent Y-o-Y to Rs 31,438 crore, while core net interest margin stood at 3.35 per cent on total assets, reflecting assets repricing faster than deposits, as against 3.46 per cent for the prior quarter ended March 31, 2025.

 

 

Its other income (non-interest revenue) for Q1FY26 stood at Rs 21,730 crore.

 

The bank’s asset quality deteriorated marginally, as gross non-performing assets (NPAs) at the end of Q1FY26 stood at 1.4 per cent, as against 1.33 per cent in Q4FY25. Similarly, its net NPAs stood at 0.47 per cent.

 

Its gross advances increased by 6.7 per cent Y-o-Y to Rs 26.53 trillion, with retail loans growing at 8.1 per cent. Small and mid-market enterprises loans grew at 17.1 per cent, and corporate and other wholesale loans increased at 1.7 per cent.

 

Meanwhile, its end of period deposits stood at Rs 27.64 trillion, up 16.2 per cent Y-o-Y, with CASA deposits growing at 8.5 per cent, and time deposits growing at 20.6 per cent over the corresponding quarter of the previous year.

 

The bank’s board also approved issuance of bonus shares in the proportion of 1:1 i.e. one bonus equity share of Re 1 each for every one fully paid-up equity share held as on the record date, subject to statutory and regulatory approvals as applicable, and approval of shareholders of the bank to be obtained by way of postal ballot.

 

Additionally, the bank’s board declared a special interim dividend of Rs 5 per share.