Executive Summary
Federal Bank is one of Indias leading private sector banks, offering a comprehensive suite of banking and financial services across retail, corporate, MSME, agricultural and NRI customer segments. Backed by a strong franchise, prudent risk management practices and a growing digital ecosystem, Your Bank continues to strengthen its position as a customer-centric and future-ready financial institution.
FY 2025-26 was a year of strong operational execution and strategic progress. Your Bank accelerated the implementation of its Federal 4.0 transformation agenda, focused on strengthening the liability franchise, optimising the asset mix, enhancing fee- based income streams and improving operating efficiency. The year also witnessed continued progress under the Free The Branch operating model, enabling greater customer focus and productivity across the branch network.
Your Bank delivered a healthy financial performance during the year, with total assets increasing to ^3,87,521 Crore, deposits rising to ^3,13,909 Crore and net advances growing to ^2,64,594 Crore. Net Interest Income increased to ^10,657 Crore, while operating profit reached ^7,206 Crore. Net profit stood at ^4,117 Crore, supported by disciplined balance sheet management, healthy business growth and resilient operating performance.
Asset quality and capital position continued to strengthen, with Gross NPA improving to 1.62%, Net NPA declining to 0.20% and Provision Coverage Ratio increasing to 87.07%. Capital Adequacy Ratio remained strong at 17.25%, with CET-1 at 15.93%, providing a robust foundation for future growth.
The year also marked several important strategic milestones, including CASA deposits crossing ^1 Lakh Crore, NR Deposits exceeding ^1 Lakh Crore, the launch of the wealth management business, a comprehensive brand refresh and continued strengthening of Your Banks leadership position in the NRI banking segment. These initiatives, together with the proposed strategic investment by Blackstone, reinforce Your Banks commitment to building a more agile, technology-enabled and customer-centric institution capable of delivering sustainable long-term value.
Economic Environment Global Economy Overview1
The year under review was characterised by heightened geopolitical uncertainties, evolving trade dynamics and continued policy adjustments across major economies.
Despite these challenges, the global economy demonstrated notable resilience, with global GDP growing by 3.4% in CY 2025. Growth was supported by steady consumer spending, resilient labour markets in several advanced economies, sustained investments in digital technologies and Artificial Intelligence (AI) and supportive fiscal measures that helped maintain economic stability amid a complex global environment.
Advanced economies recorded growth of 1.9% during the same period. The United States expanded by 2.1%, supported by healthy household consumption, continued business investment and positive financial market sentiment, although labour market conditions showed signs of gradual moderation. Europe grew by 1.4%, reflecting resilience despite persistent trade-related pressures and uneven economic performance across the region.
Emerging and developing economies continued to outperform, registering growth of 4.4%. China recorded growth of 5.0%, supported by policy measures, public expenditure and export activity. India remained one of the fastest-growing major economies, driven by robust domestic demand, a resilient services sector, sustained infrastructure investment and continued digital transformation. However, several developing economies continued to face challenges arising from elevated debt burdens, currency volatility and constrained fiscal flexibility.
Monetary policy actions, easing inflationary pressures in several regions and continued technological advancement contributed to overall economic stability. Nevertheless, the global economy remains exposed to geopolitical risks and potential disruptions to international trade and capital flows. Escalating tensions in West Asia have introduced additional uncertainty into the global macroeconomic landscape. Risks surrounding critical energy supply routes, including the Strait of Hormuz, have heightened volatility in commodity and energy markets, with potential implications for inflation, financial market sentiment and global growth prospects. In response, governments and central banks across regions continue to monitor evolving developments while strengthening economic resilience through diversified trade and energy strategies.
Outlook
Global growth is projected to moderate to 3.1% in CY 2026 before improving marginally to 3.2% in CY 2027. The moderation reflects the impact of trade-related uncertainties, softer consumption trends, easing inventory cycles and tighter financial conditions across several economies. While the medium-term growth outlook remains stable, downside risks stemming from geopolitical developments, trade fragmentation and financial market volatility warrant continued vigilance.
Global headline inflation is expected to remain relatively volatile, with forecasts indicating an increase to 4.4% in CY 2026 before moderating to 3.7% in CY 2027. Geopolitical developments, particularly those affecting energy markets and global supply chains, may contribute to temporary cost pressures and inflationary fluctuations. Consequently, central banks are expected to maintain a cautious and data-driven approach to monetary policy, balancing inflation management with support for economic growth.
Technological innovation, particularly in Artificial Intelligence (AI), continues to emerge as a significant driver of productivity and economic transformation. Within the financial services sector, AI is enabling enhanced risk management, fraud detection, customer engagement, operational efficiency and data-driven decisionmaking. These advancements are supporting the development of more efficient, secure and inclusive financial ecosystems while creating new opportunities across banking, payments and digital financial services.
As global economic conditions continue to evolve, sustaining longterm growth will depend on stronger international cooperation, investment-led expansion, financial sector resilience, structural reforms and continued innovation across both developed and emerging economies.
Indian Economy Overview2
India reinforced its position as one of the fastest-growing major economies globally during FY 2025-26. Real GDP is estimated to have grown by approximately 7.7%, compared witRs. 7.1% in the previous year, reflecting sustained economic momentum. Growth was supported by resilient rural demand, healthy agricultural output, robust services sector performance and a gradual improvement in industrial activity. Government initiatives, including the Production Linked Incentive (PLI) schemes and continued investments in infrastructure, further strengthened economic activity and investment sentiment. The favourable macroeconomic environment, coupled with improving consumer confidence and business activity, supported healthy credit demand across retail, MSME and corporate segments, while also contributing to the overall resilience of the financial sector.
Inflation remained under control, with the Consumer Price Index (CPI) at 3.93% in May 20263 based on the revised 2024 base year. Stable inflation helped protect purchasing power and supported demand across urban and rural markets. This was further supported by measures such as income tax relief, GST rationalisation and an accommodative monetary policy stance, which together sustained consumption. The Union Budget 202627 further reinforced the growth outlook through continued fiscal discipline, a public capital expenditure allocation of ^12.2 Lakh Crore, measures to strengthen MSME financing through TReDS and credit guarantee mechanisms, and reforms aimed at enhancing the efficiency and resilience of the financial sector.4
India is also strengthening its integration with global value chains. Ongoing trade discussions with the United States and the European Union are expected to support exports, enable technology transfer and attract long-term investment. In response to geopolitical developments in the Middle East, India has taken steps to diversify crude oil sourcing and strengthen alternative supply channels, improving overall energy security. During the year, the Indian Rupee experienced periods of volatility amid global geopolitical uncertainties, elevated crude oil prices and foreign portfolio outflows. However, Indias strong macroeconomic fundamentals, healthy foreign exchange reserves and prudent policy measures helped contain excessive volatility and supported overall financial stability.
Outlook
Looking ahead, India is projected to remain the fastest-growing major economy. Real GDP growth for FY 2026-27 is expected to be 6.6%.5 Expansion is likely to be supported by continued government capital expenditure and a recovery in private consumption. Real Private Final Consumption Expenditure is projected to grow by around 7.0% in FY 2025-26, indicating improving demand.
Ongoing structural reforms are expected to support long-term growth. These include GST rationalisation, progress on new and upgraded free trade agreements and continued efforts to improve the ease of doing business.
Inflation is expected to remain moderate under the revised base year. This may allow the Reserve Bank of India (RBI) to maintain a supportive monetary policy stance. In turn, this is likely to facilitate investment and sustain credit growth, even as global conditions remain uncertain due to tariff pressures and geopolitical uncertainties.
Source: BCG Banking Sector Roundup
Indias banking sector continued to demonstrate strong resilience and growth during FY 2025-26, supported by healthy economic activity, robust credit demand and improving asset quality. Total deposits increased by 10% YoY to RS. 241 Lakh Crore, while total advances grew by 13% to RS. 202 Lakh Crore, reflecting sustained lending momentum across retail, MSME and corporate segments. Asset quality continued to strengthen, with the Gross Non-Performing Asset (GNPA) ratio improving to 1.9%, one of the lowest levels in recent years. Despite moderation in Net Interest Margins (NIMs) to 3.0% amid funding cost pressures, the sector remained profitable, reporting a return on assets (RoA) of 1.3% and profit after tax (PAT) of approximately RS. 2.9 Lakh Crore. Strong capitalisation, healthy provisioning buffers and increasing digital adoption further reinforced the sectors ability to support economic growth while maintaining financial stability.
The sector also witnessed continued consolidation around well-capitalised institutions, with banks increasingly focusing on strengthening balance sheets, improving operational efficiency and expanding scale through technology-led transformation rather than aggressive branch expansion. Consolidation trends, coupled with disciplined capital allocation and stronger governance frameworks, are expected to enhance long-term competitiveness and resilience across the banking system.
Credit Growth, Deposits and Liquidity Conditions
Credit demand remained healthy across key segments, supported by consumption-led growth, infrastructure investments and improving business activity. Total advances grew by 13% YoY, outpacing deposit growth of 10%, resulting in elevated credit-deposit ratios across the banking system.
MSME lending emerged as the fastest-growing segment, recording growth of 17%, followed by retail and agricultural lending at 13% each. Corporate lending also witnessed steady growth, supported by infrastructure development and capacity expansion across select sectors.
Deposit mobilisation remained a key focus area for banks. While term deposits grew by 11.3%, CASA growth moderated to 8.8%, leading to a decline in the industry CASA ratio. The gap between credit and deposit growth continued to place pressure on funding costs, although RBI liquidity measures helped maintain adequate system liquidity.
Indias strong macroeconomic fundamentals and resilient banking system continued to attract foreign institutional interest in the financial sector. Stable capital inflows, growing investor confidence and sustained participation by global investors supported funding availability and reinforced confidence in Indias long-term banking growth story.
Retail, MSME and Rural Banking Landscape
Retail, MSME and rural segments continued to drive banking sector growth. Retail lending remained supported by strong demand for housing, vehicle finance and secured lending products. MSME financing benefited from increasing formalisation, government support initiatives and wider adoption of digital underwriting models.
Rural credit demand remained healthy, supported by resilient agricultural activity, favourable monsoon conditions and continued financial inclusion initiatives. Banks continued to expand their presence in semi-urban and rural markets through digital channels, business correspondents and technology- enabled service delivery models.
India continued to strengthen its position as one of the worlds leading digital financial ecosystems. Unified Payments Interface (UPI) remained the primary driver of digital payments, with transaction value exceeding RS. 28 trillion and annual growth exceeding 20%.
Banks accelerated investments in digital platforms, artificial intelligence, analytics and cybersecurity to enhance customer experience, improve operational efficiency and strengthen risk management. Collaboration between banks and fintech companies continued to support innovation across payments, lending, wealth management and embedded finance solutions.
India remained the worlds largest recipient of remittances, supported by a large overseas Indian diaspora and increasing adoption of digital payment channels. Growing remittance inflows continued to support deposit mobilisation, foreign exchange flows and customer engagement opportunities for banks.
The wealth management and insurance sectors also recorded strong growth. Mutual fund assets under management expanded to approximately RS. 82 trillion, supported by sustained SIP inflows and growing retail participation. Insurance premiums witnessed healthy growth driven by rising awareness, financial planning and wider distribution networks. These trends continue to create opportunities for banks to diversify revenue streams through bancassurance, investment products and advisory services.
Retail, MSME and rural segments remained key growth engines for the banking sector. Retail lending benefited from rising household incomes, improving employment conditions and increasing demand for housing and vehicle finance. MSME lending continued to expand through greater formalisation, digital underwriting and government-backed support programmes. Rural credit demand remained healthy, supported by favourable agricultural conditions, higher farm incomes and continued financial inclusion initiatives. Banks increasingly leveraged analytics-driven underwriting models and digital channels to expand outreach while maintaining portfolio quality.
Regulatory Developments
The regulatory environment during FY 2025-26 remained focused on supporting economic growth while preserving financial stability. The Reserve Bank of India (RBI) reduced the policy repo rate by a cumulative 125 basis points since February
2025 to 5.25% and lowered the Cash Reserve Ratio (CRR) by 100 basis points to 3.0%, releasing significant liquidity into the banking system. Additional liquidity support through open market operations and foreign exchange swap interventions helped maintain orderly market conditions and support credit transmission. Alongside liquidity measures, the regulatory focus also supported credit expansion through measures to strengthen MSME financing, including enhancement of collateral-free lending limits, wider adoption of Account Aggregator and GST- linked underwriting frameworks, and continued promotion of digital credit assessment to improve access to formal finance. The banking sector remained well-capitalised, with capital adequacy levels comfortably above regulatory requirements and asset quality improving, as reflected in the decline of the GNPA ratio to 1.9%. Alongside monetary and liquidity measures, the RBI continued to strengthen regulatory oversight through enhanced focus on digital resilience, cyber security, governance standards, responsible lending practices and customer protection. During the year, the regulatory focus also intensified on governance standards, board oversight, compliance culture, risk governance and accountability, encouraging banks to strengthen internal controls, enhance transparency and reinforce long-term financial resilience.
Industry Outlook
The Indian banking sector is expected to maintain a healthy growth trajectory in FY 2026-27, supported by resilient domestic demand, continued infrastructure investments and favourable demographic trends. Credit growth is expected to remain robust across retail, MSME and corporate segments, while asset quality is likely to remain stable, supported by low GNPA levels and strong provisioning buffers.
Although competition for deposits and margin pressures may persist in the near term, improving liquidity conditions, stable regulatory oversight and ongoing digital transformation are expected to support long-term profitability and sector resilience. Increasing adoption of technology, expansion of financial services ecosystems and deeper financial inclusion are expected to create significant growth opportunities for the banking sector over the medium term.
Strategic Transformation Journey
FY 2025-26 represented a significant milestone in Your Banks transformation journey. Building upon the foundations laid in the previous year, Your Bank accelerated the execution of Federal 4.0, a strategic framework designed to strengthen long-term competitiveness, improve operating efficiency and create a more agile, customer-centric organisation. Anchored in the objective of delivering sustainable and profitable growth, the framework focuses on strengthening the liability franchise, improving asset quality and yields, enhancing fee-based income streams and embedding a performance-driven culture across the organisation. Throughout the year, Your Bank remained focused on translating these strategic priorities into measurable outcomes.
A key enabler of this transformation has been the implementation of the Free The Branch operating model. Under this initiative, Your Bank undertook a comprehensive redesign of branch operations with the objective of allowing frontline teams to devote greater time and resources towards customer engagement, relationship building and business generation. The establishment of specialised business support centres, regional processing hubs and service centres, coupled with initiatives focused on centralisation, digitisation, simplification and process optimisation, has helped streamline operations and improve productivity across the network. At the same time, Your Bank strengthened accountability through branch-level profitability frameworks, redesigned performance scorecards and a more data-driven approach to network expansion and optimisation.
Another important area of focus has been asset mix optimisation. Recognising the need to improve risk-adjusted returns while maintaining prudent risk management standards, Your Bank undertook a calibrated rebalancing of its loan portfolio towards higher- and medium-yielding segments. Growth was driven through businesses such as commercial banking, commercial vehicle finance, loan against property, gold loans and select retail lending products, while maintaining discipline in segments where risk-reward dynamics were less favourable. Alongside this, sustained efforts to deepen CASA relationships, strengthen current account acquisition and improve deposit granularity contributed towards enhancing the quality of the liability franchise and supporting margin resilience.
The transformation journey also extended beyond operations and balance sheet management. During the year, Your Bank strengthened its brand identity through a comprehensive brand refresh, expanded its digital capabilities, launched its wealth management business and continued to reinforce its leadership position in the NRI banking segment. Collectively, these initiatives represent meaningful progress in Federal 4.0 and reflect Your Banks commitment to building a future-ready institution capable of delivering enduring value to customers, employees, shareholders and all stakeholders.
During FY 2025-26, Your Bank reported total income of ^32,136 Crore, registering a growth of 6.5% over ^30,167 Crore in the previous year. Interest income increased to ^27,695 Crore from ^26,365 Crore, supported by healthy growth in advances and sustained business momentum. Non-interest income grew by 16.8% to ^4,440 Crore from ^3,801 Crore, reflecting strong performance across fee-based businesses, treasury operations and other non-fund income streams. Interest income accounted for 86.2% of total income during the year.
Interest/discount on advances and bills increased to ^21,710 Crore from ^21,017 Crore in FY 2024-25. Interest on investments rose to ^4,770 Crore from ^4,542 Crore, while interest on balances with RBI and inter-bank funds stood at ^458 Crore compared with ^443 Crore in the previous year. Other interest income increased to ^757 Crore from ^364 Crore.
During FY 2025-26, total expenditure increased to ^24,930 Crore from ^24,065 Crore in the previous year. Interest expended stood at ^17,038 Crore compared with ^16,897 Crore, reflecting growth in the deposit franchise and overall business expansion. Operating expenses increased to ^7,892 Crore from ^7,168 Crore, driven by investments in technology, branch expansion, digital capabilities, people initiatives and business growth.
| Particulars | FY 2024-25 | FY 2025-26 |
| Net Interest Income | 9,468 | 10,657 |
| Non-Interest Income | 3,801 | 4,440 |
| Net Total Income | 13,269 | 15,097 |
| Operating Expenses | 7,168 | 7,892 |
| Operating Profit | 6,101 | 7,206 |
The Net Interest Income of Your Bank increased by 12.6% to ^10,657 Crore during FY 2025-26 from ^9,468 Crore in the previous year. Non-interest income grew by 16.8% to ^4,440 Crore from ^3,801 Crore. Consequently, Net Total Income increased by 13.8% to ^15,097 Crore compared with ^13,269 Crore in FY 2024-25. Operating Profit grew by 18.1% to ^7,206 Crore from ^6,101 Crore in the previous year, demonstrating strong operating leverage and business momentum.
| Particulars | March 31, 2025 | March 31, 2026 |
| GNPA (Rs. Crore) | 4,376 | 4,335 |
| NNPA (Rs. Crore) | 1,040 | 529 |
| Provision Coverage Ratio (%) | 75.37 | 87.07 |
Your Bank further strengthened its asset quality profile during FY 2025-26, with Gross NPA improving to 1.62% from 1.84% and Net NPA declining to 0.20% from 0.44%. Gross NPA stood at ^4,335 Crore compared with ^4,376 Crore a year ago, while Net NPA reduced significantly to ^529 Crore from ^1,040 Crore. Provision Coverage Ratio (excluding technical writeoffs) improved substantially to 87.07% from 75.37%, reflecting
the Banks prudent provisioning approach and strong risk management framework.
| Particulars | FY 2024-25 | FY 2025-26 |
| Return on Assets (ROA) (%) | 1.23 | 1.15 |
| Return on Equity (ROE) (%) | 13.03 | 11.47 |
| Cost to Income Ratio (%) | 54.02 | 52.27 |
| Net Interest Margin (NIM) (%) | 3.13 | 3.24 |
| Book Value Per Share (^) | 134.87 | 157.00 |
| Credit Cost (bps) | 38 | 73 |
Your Bank continued to deliver stable profitability and operational efficiency during FY 2025-26. Net Interest Margin expanded to 3.24% from 3.13%, supported by favourable asset mix, improving liability profile and disciplined balance sheet management. Cost-to-Income Ratio improved to 52.27% from 54.02%, reflecting enhanced operating efficiency. Earnings per share increased to ^16.74 from ^16.54, while Capital Adequacy Ratio strengthened to 17.25%, providing a robust capital base to support future growth.
| Particulars | March 31, 2025 | March 31, 2026 | % Change |
| CASA + Other Demand | 86,378 | 1,04,437 | 20.9% |
| Deposits | |||
| Term Deposits | 1,97,270 | 2,09,473 | 6.2% |
| Total Deposits | 2,83,647 | 3,13,909 | 10.7% |
Gross Advances
| Particulars | March 31, 2025 | March 31, 2026 | % Change |
| Micro Advances | 4,112 | 4,360 | 6.0% |
| Very High Yielding Advances (Total) | 4,112 | 4,360 | 6.0% |
| Credit Cards | 3,550 | 4,368 | 23.0% |
| Personal loans | 3,789 | 3,782 | -0.2% |
| High Yielding Advances (Total) | 7,339 | 8,150 | 11.1% |
| Gold loans | 30,505 | 38,401 | 25.9% |
| Commercial Banking | 23,723 | 29,846 | 25.8% |
| Business Banking | 18,963 | 20,196 | 6.5% |
| Auto loans | 8,605 | 8,778 | 2.0% |
| Agri & Allied | 8,208 | 8,448 | 2.9% |
| Loan Against Property | 7,175 | 8,107 | 13.0% |
| CV/CE | 4,644 | 5,797 | 24.8% |
| Other Medium Yielding Advances | 2,264 | 1,561 | -31.1% |
| Medium Yielding Advances (Total) | 1,04,087 | 1,21,134 | 16.4% |
| Corporate and Institutional Banking | 81,976 | 89,076 | 8.7% |
| Housing loans | 36,617 | 36,128 | -1.3% |
| Other Low Yielding Advances | 7,334 | 7,393 | 0.8% |
| Low Yielding Advances (Total) | 1,25,927 | 1,32,597 | 5.3% |
| IBPC/BRDS | -3,332 | 2,128 | - |
| Gross Advances | 2,38,134 | 2,68,369 | 12.7% |
Your Banks advances portfolio continued to grow in a balanced manner during FY 2025-26, supported by healthy traction across retail, commercial and business banking segments. Gross advances increased by 12.7% to ^2,68,369 Crore from ^2,38,134 Crore in the previous year. The Bank remained focused on portfolio diversification, risk-adjusted growth and maintaining a healthy mix across retail and wholesale segments.
Capital Management
| Particulars | March 31, 2025 | March 31, 2026 |
| Common Equity Tier-1 Capital | 31,593 | 36,814 |
| Additional Tier-1 Capital | 0 | 0 |
| Total Tier-1 Capital | 31,593 | 36,814 |
| Tier-2 Capital | 2,867 | 3,048 |
| Common Equity Tier-1 Ratio (%) | 15.04 | 15.93 |
| Tier-1 Capital Ratio (%) | 15.04 | 15.93 |
| Tier-2 Capital Ratio (%) | 1.36 | 1.32 |
| Total Capital Ratio (%) | 16.40 | 17.25 |
Your Bank maintained a strong capital position during FY 2025-26, with Total Capital Adequacy Ratio improving to 17.25% from 16.40% in the previous year.
Balance Sheet Parameters
| Particulars | March 31, 2025 | March 31, 2026 | % Change |
| Liabilities | |||
| Capital | 491 | 493 | 0.3% |
| Share Warrants Subscription Money | - | 1,549 | NM |
| Reserves & Surplus | 32,929 | 36,663 | 11.3% |
| Deposits | 2,83,647 | 3,13,909 | 10.7% |
| Borrowings | 23,726 | 21,159 | (10.8%) |
| Other Liabilities & Provisions | 8,210 | 13,748 | 67.4% |
| Total Liabilities | 3,49,005 | 3,87,521 | 11.0% |
| Assets | |||
| Cash & Balances with RBI | 20,354 | 15,566 | (23.5%) |
| Balance with Banks & Money at Call and Short Notice | 10,505 | 10,161 | (3.3%) |
| Investments | 66,246 | 76,676 | 15.7% |
| Advances | 2,34,836 | 2,64,594 | 12.7% |
| Fixed Assets | 1,478 | 1,473 | (0.4%) |
| Other Assets | 15,585 | 19,051 | 22.2% |
| Total Assets | 3,49,005 | 3,87,521 | 11.0% |
Your Banks balance sheet expanded by 11.0% during FY 202526, with total assets increasing to ^3,87,521 Crore as on March 31, 2026 from ^3,49,005 Crore a year earlier. Growth was driven by a 12.7% increase in advances and a 10.7% rise in deposits, reflecting sustained business momentum. Investments increased by 15.7% to ^76,676 Crore, while reserves and surplus grew by 11.3% to ^36,663 Crore. The Bank maintained a strong and diversified funding profile, supported by a healthy deposit franchise, prudent capital management and adequate liquidity buffers.
Credit Monitoring & Asset Quality Management Credit Monitoring
Credit Monitoring Department (CRMD) is instrumental in maintaining the health of the banks credit portfolio. The core of the credit monitoring process involves identifying early signs of stress and initiating timely corrective actions.
Following the sanction and disbursement of credit facilities, the CRMD team continuously oversees the performance of the Banks loan portfolio. Once exposures are onboarded into the system, the Department closely tracks a range of indicators related to account behaviour, including borrower conduct, transactional patterns, economic developments and market trends. This systematic monitoring enables early identification of potential stress, allowing the Bank to take prompt corrective action and mitigate potential losses.
To support this function, CRMD utilizes a combination of internally developed and externally sourced tools to collect and analyse data from both internal and external channels. In order to remain responsive in a rapidly evolving socio-economic landscape, CRMD increasingly leverages advanced data analytics, market intelligence and technology-driven solutions with the support of Data Analytics and Market Intelligence [DAMI] unit to strengthen its risk assessment, monitoring processes and early warning systems.
To have a focussed monitoring, the corporate borrowers are monitored by a separate team, CRMD Large Corporate and other portfolios are handled by CRMD -SME, Retail & Agri (SRA). During FY 2025-26, with a view to streamline processes, improve efficiencies and to ensure compliance with regulatory requirements in EWS monitoring, CRMD SRA moved to a centralised approach from the erstwhile geography wise monitoring structure. Separate verticals for monitoring of various portfolios were constituted, which are aligned to specific business segments, allowing for focused monitoring based on ticket size, industry characteristics and borrower profiles.
The improved segmentation of portfolios and increased use of data-driven insights to identify emerging borrower stress patterns have significantly improved the timeliness and accuracy of early warning detection, enabling more effective intervention strategies.
Credit Health Management
The Credit Administration Department ensures the credit administration functions of your Bank for borrowers with aggregate exposure of ^1 Crore and above, with certain exclusions i.e. Loans against liquid securities, viz., Gold loans, Advance against deposit/other approved securities, Retail auto loans and Term loans sanctioned under Federal Agri Mobile Scheme to entities for acquiring various types of Vehicles/ equipment.
The department ensures compliance with all pre-disbursal covenants of credit sanctions and error-free documentation through digital platform wherever feasible, before disbursing a limit. The department prepares the documents as per sanction terms, verifies the executed documents once they are submitted for setting up of limit and ensures the creation of charge in Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI), Registrar of Companies (ROC) and E-Mortgage Recorder (EMR) along with perfection of securities within the stipulated timeframe. The department also disseminates non complied post disbursal covenants of credit sanction periodically with respective business verticals and ensures proper compliance basis documentary evidence submitted by the business team.
Further, the department ensures adherence to regulatory guidelines concerning maintenance of accounts / exposures by the borrowers. The department also confirms sufficiency and protection of underlying assets in loans and advances, irrespective of the borrower exposure, by regular tracking of non-compliances in other post sanction operational aspects.
The department also constantly reviews existing processes to identify process improvements and endeavours for digitisation of such processes to ensure an excellent turnaround time.
Asset Quality Management
Your Bank has been managing its NPA portfolio and continuously improving our collection and recovery architecture to improve the asset quality. By leveraging a suite of analytical tools, were now able to predict both the propensity to default and the collection score of borrowers with greater accuracy. These analytics have directly enhanced our collection strategies, allowing us to act more proactively and efficiently. Another significant step forward
has been the strengthening of our collection mechanism, from expanding our teams capacity to building stronger partnerships.
The enhanced use of digital tools and analytics has further elevated our position, placing us amongst one of the best in collection practices and efficiency. Our pre-due reach out methods, guided by analytics and risk segmentation, are particularly noteworthy. Additionally, the centralization of various recovery activities has paid off remarkably well, enabling us to recover dues from borrowers with even greater speed and effectiveness. These collective efforts not only bolster our asset quality but also reinforce our reputation for prudent and innovative collection practices.
As a result, your Banks Gross NPA as a percentage of Gross Advances improved to 1.62% as on March 31, 2026, as against 1.84% on March 31, 2025. Net NPA as a percentage of Net Advances of your Bank improved to 0.20%. Your Bank continued to maintain adequate provision for NPAs with Provision Coverage Ratio (excluding TWO) improving to 87.07%.
Analytics & Data Science
The Data Science landscape has evolved rapidly in recent years, propelled by exponential growth in data volumes and the deep integration of AI & ML into enterprise decision-making processes. Organizations are increasingly leveraging advanced analytics as a strategic enabler to drive innovation, improve customer engagement and gain competitive edge. Emerging trends such as real-time and streaming analytics, Gen & Agentic AI, Augmented Analytics, Explainable AI (XAI) and cloud-native data platforms are fundamentally transforming how businesses operate, enabling faster, more intelligent and scalable decision-making.
Aligned with these industry advancements, the Data Science team of your Bank has made significant progress over the past year by successfully deploying more advanced machine learning models and AI-driven solutions. These initiatives have played a critical role in enhancing customer experience, improving operational efficiency and enabling data-driven cost optimization. The team has also developed state-of-the-art analytical frameworks, incorporating capabilities such as predictive modelling, next- best-action engines and advanced customer segmentation, while establishing a robust Centre of Excellence to ensure standardized, scalable and efficient delivery of analytics solutions.
Looking ahead, the Data Science team is well-positioned to drive the next phase of transformation by deepening its focus on AI and machine learning-led innovations. Key priorities include strengthening real-time decisioning capabilities, expanding cloud-native and data engineering ecosystems for enhanced scalability and resilience and leveraging advanced techniques such as Agentic AI, Graph Analytics and AutoML. The overarching objective is to build deeper customer relationships through hyperpersonalization, next-best-customer strategies and intelligent engagement frameworks.
Furthermore, the Bank aims to unlock new value streams by expanding analytics-driven initiatives across business lines, with a focus on revenue enhancement, cost optimization and portfolio quality improvement. By continuously adopting cutting-edge
technologies and best practices, the Data Science team will ensure that your Bank remains at the forefront of the Analytics and Data Science domain, driving sustained growth, innovation and strategic excellence.
Management Information Systems (MIS)
The MIS team plays a pivotal role in coordinating comprehensive report generation and reports automation. Their primary objectives include ensuring data quality, accuracy and timeliness of information for management decision-making. The agile reporting of MIS enables branches and offices to align and organise themselves to the set goals. The automated reports/ insights to individual business units, by making use of cutting- edge business intelligence tools, enable the users to slice and dice data, helping them to derive meaningful insights and empowering them to take informed business decisions.
The major activities handled by the team are
• Critical Data Extraction Cell: which works on generation of critical reports (including regulatory) and allied processes, automation and centralized generation of regulatory returns, maintaining SOPs for these returns and ensuring periodic review of the processes/ SOPs.
• Quality Assurance Cell: which works on putting in place various quality checks for critical reports handled by MIS, identifying system/ process gaps which result in data errors and coordinating with different stakeholders for resolution of the issues.
• Regulatory Reporting Unit: which is involved in submission of regulatory returns.
• Automation and Projects team: which explores possibilities in automating reports to different stakeholders, creation and maintenance of analytical dashboards/ drill-down reporting, improving the efficiency of processes adapted by MIS. Supply of data to different applications and processes including SFTP, CX, Credit Card system, Customer communication system etc.
• MIS Operations team: which is responsible for handling the adhoc data requests from branches/ offices, development and deployment of standard reports (CBS Reports), managing the scheduled activities and other day to day processes of MIS and maintaining and ensuring completion of calendar list of activities performed regularly (daily/ monthly/ quarterly etc.).
The following key deliverables are planned for implementation during FY 2026-27:
1. Migration of Reporting Platform and Compliance with DPRD Guidelines
Migration of the existing reporting platform to a new software solution, along with the implementation of DPRD guidelines across all data dissemination channels of the MIS Division. This includes MIS Connect tickets, Fed-Share file sharing, email-based distribution and CBS reports.
2. Transition to Element-Based Reporting (EBR) for Regulatory Returns
Migration of regulatory return submissions from the existing CIMS framework to Element-Based Reporting (EBR), in line with RBI guidelines.
3. Implementation of Software to Streamline MIS Operations, including:
Loan Data Correction for Large Borrowers: Implementation of a solution to improve data quality for regulatory return submissions related to large corporate borrowers.
* AI-Based SQL Generator: Development and
deployment of an AI-based SQL generation tool to standardize SQL queries for data extraction. The tool interprets user data requests and converts them into Oracle SQL by referencing the Enterprise Data Dictionary, leveraging AI techniques such as Natural Language Processing (NLP) and Retrieval-Augmented Generation (RAG).
* Implementation of ECL and EIR framework: The MIS
team has been included in the Steering Committee and the working group to drive the end-to-end implementation of the framework.
Segment-wise Performance Corporate & Institutional Banking
The Corporate and Institutional Banking division provides a comprehensive suite of financial products and advisory services to large and mid-sized corporates, multinational corporations (MNCs), capital market clients, public sector undertakings (PSUs) and financial institutions. This division offers tailored products and services encompassing working capital, term funding, structured finance, cash management, trade finance and foreign exchange services, all supported by robust electronic banking solutions that facilitate seamless onboarding and customer journey.
The distribution network is expanding through the Relationship Management structure to deeper geographies and multiple servicing touchpoints, addressing the entire value chain across different customer segments. We also serve our clients overseas funding requirement through our GIFT City presence in Gandhinagar, Gujarat by way of various products and services.
During FY 2025-26, the Bank strengthened its focus on MidMarket clients offering comprehensive financial products structured to its financial needs and duly leveraging on our syndication and structured finance franchise capabilities, while deepening engagement with clients.
In FY 2025-26, the Bank significantly advanced its digital transformation, positioning digital platforms as a key enabler for client engagement, transaction growth and fee accretion. The Banks flagship platform, FedOne, continued to witness strong adoption, supporting active corporate users, while emerging as a central hub for managing corporate transactions.
During the year, the Bank introduced a series of strategic enhancements to strengthen its digital payments and collections ecosystem. A key milestone was achieving the status of a SEBI- registered UPI ASBA Sponsor Bank, enabling participation in high-value capital market transactions. The Bank also launched a cloud-based UPI acquiring stack with UPI 2.0 capabilities, offering a comprehensive suite of solutions such as UPI Autopay, Intent, QR-based collections and API integrations for merchants across sectors.
These initiatives collectively reflect the Banks strategic focus on building a digital-first, scalable and ecosystem-led transaction banking franchise, driving deeper client engagement, improved operational efficiency and sustained growth in fee-based income and liability balances.
During FY 2025-26, Corporate exposures increased to Rs. 95,367 Crore, registering a growth of 8% YoY. Asset quality continues to be robust with negligible GNPA. This vertical aims to be the preferred banking partner for its clients, using a robust client selection strategy and a sound credit underwriting process that are reflected in its asset quality.
Commercial Banking
The Commercial Banking vertical serves Mid corporate and MSMEs, a key focus area for the Bank. With a dedicated relationship structure, geographic reach and a wide range of products — working capital, term loans, trade finance, advisory services, cash management, supply chain finance, foreign exchange, structured offerings, gold metal loans and bespoke liability products — the Bank ensures lasting client relationships. Relationship Managers use data insights and alerts to provide customers with the right products and timely solutions.
Supply Chain Finance
* The Banks Supply Chain Finance (SCF) portfolio (including Factoring) witnessed strong momentum in FY 2025-26, with the portfolio reflecting a robust 27% YoY growth, highlighting a broad-based expansion across both traditional and structured supply chain solutions.
* A key highlight during the year was the significant acceleration in invoice-based financing, with the Purchase Invoice Discounting/ Sales Invoice Discounting. This underscores the Banks increasing focus on granular, short- tenor and transaction-driven lending, aligned to evolving client working capital requirements.
* The Bank also expanded its OEM/anchor partnership ecosystem, with the addition of marquee names in FMCG and Steel sector under distributor financing programmes. These partnerships have enabled deeper penetration across diverse industry verticals including FMCG, auto, pharma, steel and paper/packaging, strengthening the Banks presence across key supply chains. *
* On the technology front, the Bank enhanced its digital capabilities through integration with IBDIC (Invoice Hub) for invoice verification and de-duplication, along with the creation of a dedicated digitised module for sales invoice
discounting. These initiatives have improved operational efficiency, risk control and scalability of the SCF business.
* Overall, the SCF franchise continues to evolve as a key growth driver within Wholesale Banking, with a strong focus on ecosystem-led client acquisition, digital integration and transaction-driven revenue streams, positioning the Bank for sustained expansion in the supply chain financing space.
Achievements
During FY 2025-26, this business stepped up further with a closing advance position of Rs. 29,846 Crore, registering a growth of 26% YoY. Fee income grew by 28% to Rs. 219 Crore in FY 2025- 26 with continuous improvement in asset quality. The business maintains a diversified and a granular portfolio across various sectors and regions. This business strives to ensure it remains the "Bank of First Choice" for all its clients.
CV / CE Financing
The Commercial Vehicle and Construction Equipment (CV/CE) financing business of the Bank continues to grow at a very stable rate, supported by branch supported operations and dedicated relationship management. The CVCE sector continues to grow ably supported by Governments support on Infrastructure, roads, mining sector and construction activities. The sectors also got support by the urbanisation and logistics activity; however, FY 27 may witness moderate and uneven demand trends, influenced by current global geopolitical developments, operating cost pressures and evolving freight market conditions. During the year, Commercial vehicles grew by 11 % and hit a record 1 million units in Sales. Construction Equipments Sales declined by 2% in Units.
The Bank pursued a measured, risk-aligned growth strategy, selectively strengthening its presence in identified segments while maintaining underwriting discipline and portfolio quality. The Bank has measuredly enhanced its focus on used CV/CE financing, while strengthening the valuation processes, tighter eligibility norms and enhanced risk assessment frameworks. This calibrated approach has enabled selective participation while ensuring portfolio stability.
At the end of Q4 FY 2025-26, the CV/CE portfolio AUM stood at ^5,797 Crore, registering a 25% YoY growth over Q4 FY 2024-25 and an 8.5% sequential growth over Q3 FY 2025-26. During Q4 FY 2025-26, disbursements aggregated ^962 Crore, representing a 24% YoY increase. For the full year, total disbursements exceeded ^3,000 Crore, supported by demand across select CV and CE sub-segments.
The Bank continued to expand its customer footprint, with active customer accounts increasing by 27% YoY, from 24.7K accounts as at the end of FY 2024-25, 31.7K accounts as the end of FY 2025-26 with deeper penetration across geographies.
At the end of Q4 FY 2025-26, 82% of the CV/CE portfolio qualified as MSME advances, reaffirming the Banks focus on supporting small enterprises and entrepreneurial activity across rural and semi-urban markets. Asset quality witnessed notable
improvement during the year, with fresh NPA levels declining due to disciplined portfolio management and strengthened collection and recovery mechanisms.
The business continues to be supported by an experienced team across sourcing, credit appraisal, operations, collections and recovery, enabling disciplined execution and consistent service delivery.
Government & Institutional Business
Industry Structure and Key Developments
The Government and Institutional Banking segment in Bank plays a critical role in managing public funds, facilitating welfare disbursements and supporting developmental and infrastructure initiatives. The segment caters to Central and State Governments, Autonomous Bodies, Urban and Rural Local Bodies, Public Sector Undertakings, Trusts, Associations, Societies, cooperatives and Clubs (TASC), educational institutions, healthcare institutions and other government-owned or government-aided entities.
The industry continues to undergo a structural transformation driven by the Governments focus on digital public finance management, enhanced transparency and technology-enabled governance. Increased adoption of electronic collections and payments, digital treasury platforms, Direct Benefit Transfer (DBT) mechanisms, real-time reporting and automated reconciliation has redefined expectations from banks servicing this segment. Consequently, banks are required to provide secure, scalable and integrated digital solutions alongside traditional banking services, while ensuring high standards of compliance, system resilience and service reliability.
Business Overview and Performance
The Government & Institutional Business (GIB) Department focuses on delivering comprehensive banking and digital solutions to Government Departments and Institutional clients, contributing significantly to the Banks CASA and Term Deposit mobilisation.
The Department is managed through dedicated Relationship Managers deployed across the country, supported by multiple touchpoints to canvass liability business arising from Central and State Government budgetary allocations as well as Local and State Government bodies such as Panchayats, Municipalities and Trusts, Associations, Societies and Clubs (TASC). Your Bank offers bespoke CASA products designed specifically to meet the operational, regulatory and reporting requirements of Government and Institutional entities.
In addition to liability mobilisation, the Department actively partners with Government Departments to digitise financial and operational workflows, enabling greater efficiency, transparency and last-mile connectivity. During the year, the Department recorded strong improvement in deposit quality, with Average GIB CASA growing by 45.53% YoY, while the CASA ratio improved significantly from 21.43% to 35.72%, underscoring the sustained focus on low-cost, transaction-led balances.
Key Highlights and Achievements of FY 2025-26
• RBI authorisation received for collection of Government receipts for the States of Maharashtra, West Bengal and Chhattisgarh, expanding the Banks agency business footprint.
• Enabled DBT payments for Government Departments
• Live on the Tamil Nadu Government scheme distribution
platform, supporting efficient and transparent
fund disbursement.
• Went live for large-scale digital collections with automated reconciliation, covering taxes, dues, fees, fines and lease rentals for a major urban development authority, enhancing efficiency and transparency in municipal collections.
• Strategic engagement with a State Government
in the North-East for two flagship women-centric entrepreneurship and livelihood schemes, resulting in significant Current Account mobilisation and meaningful contribution to profitability during the year.
• Live on Payment Gateway for GST collections
• Approval received for Payment Gateway integration with a leading national education examination body, further strengthening the Banks digital collections and institutional payments ecosystem
• Permissions obtained for integration with ESIC and EPFO, expanding statutory collection capabilities.
• Completed migration to e-Kuber 2 across all agency arrangements and launched automated TOC calculation module, improving efficiency in claiming agency commission from RBI.
• Achieved go-live on key Government platforms, including Hybrid TSA module of PFMS and Khajane 2.0 (NTT) of Karnataka Treasury, enabling wider participation in Government schemes and treasury-linked business.
• Significant operational and digital initiatives, for Treasury Current Account, launch of a digital temple management solution, roll-out of a centralised agency commission dashboard and go-live of a proposal generation platform to improve efficiency and standardisation for Relationship Managers.
Way Forward
Going ahead, the Department will focus on onboarding top-notch Government and Institutional clients with high transaction potential to further strengthen the CASA portfolio and ensure a steady flow of fee-based income. Emphasis will be placed on leveraging the Banks digital capabilities to facilitate seamless collections, payments and fund management, thereby reducing operational dependency on branches. These digital-led solutions will ensure efficient fund flows, enhanced control and transparency for clients and sustained engagement across the lifecycle of government funds.
This focused approach is expected to further consolidate the Banks position as a preferred banking partner for Government and Institutional entities while delivering stable and sustainable growth.
Business Banking continued to strengthen its position as a key medium-yielding portfolio, serving the financing requirements of Micro, Small and Medium Enterprises (MSMEs) through a comprehensive suite of working capital, term loan and cash management solutions. During FY 2025-26, the portfolio expanded to ^20,196 Crore, registering a 6.5% YoY growth, reflecting the Banks calibrated approach towards sustainable and risk-adjusted expansion.
The Bank maintained a disciplined growth strategy during the year, prioritising portfolio quality, pricing discipline and yield protection over accelerated volume growth. This prudent approach enabled the business to preserve asset quality while deepening relationships with existing customers and selectively acquiring new-to-Bank clients across high-potential MSME clusters.
To strengthen its MSME franchise, the Bank continued to enhance its product offerings with sector-specific and customised financing solutions designed to address diverse business requirements. Its focus on relationship-led banking, faster credit delivery and customer-centric service helped improve market
penetration while supporting the evolving financing needs of enterprises across industries. The Bank also leveraged its branch network and specialised sales teams to expand customer reach and improve distribution efficiency.
Looking ahead, the Bank remains focused on scaling its Business Banking franchise through calibrated growth, enhanced digital capabilities and strengthened customer engagement. Backed by disciplined underwriting and a continued emphasis on portfolio quality, the business is well positioned to support Indias growing MSME ecosystem while delivering sustainable and profitable growth.
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Retail Banking
In fiscal year 2026, your Bank continued to strengthen its deposit franchise with focus on granular and sustainable liability growth. Hence retail deposit mobilization and reducing reliance on high-value deposits was its strategy. Total deposits grew by approximately 11% YoY, while CASA balances crossed the significant milestone of ^1 Lakh Crore, registering a YoY growth of around 21%. The CASA ratio improved by 271 basis points to 32.94% YoY. The share of CASA and term deposits below ^3 Crore improved from 81% in Q4 FY 2024-25 to 85% in Q4 FY 2025-26.
The Bank continued to maintain its strong presence in the NonResident business, with NR deposits crossing the significant milestone of RS. 1 Lakh Crore during the year. The Bank also strengthened its reach across newer international corridors, with non-GCC markets outperforming GCC corridors in both acquisition momentum and balance growth.
During the year, the Bank enhanced its premium banking proposition through revamped Celesta and Imperio offerings for affluent and HNI customers. These propositions are designed to provide a more rewarding, personalized and seamless banking experience across priority customer segments.
The Bank also revamped its Current Account offerings to better meet the evolving needs of business customers. A digital Current Account onboarding platform was launched, enabling individuals and sole proprietors to open accounts end-to-end without branch intervention. These initiatives supported healthy growth in the Current Account portfolio, with balances increasing by around 23% YoY.
In fiscal year 2026, the Bank facilitated more than RS. 2.75 Lakh Crore of cross-border inward remittances, registering a YoY growth of around 33%. The Bank further strengthened its global remittance network witRs. 95 active partnerships, including four new partnerships added during the year. Key initiatives such as going live with the UPI Inward Remittance project in collaboration with NPCI and selection for the RBIs SFMS Global initiative further enhanced the Banks cross-border remittance capabilities.
Retail Advances
The Banks retail advances portfolio stood at RS. 70,118 crore, reflecting a year-on-year growth of 1% and constituting 26.5% of the Banks total advances. The retail book continued to demonstrate steady traction across key product segments, supported by a balanced portfolio mix and focused product- level interventions. Housing Loans and Retail Loans against Property continued to remain the principal components of the retail advances book, together accounting for around 60% of the portfolio. The Bank also witnessed an improved contribution from unsecured retail products, supporting margin enhancement while maintaining a calibrated approach to credit cost.
During the year, the Housing Loan portfolio stood at RS. 36,128 crore, while the Retail LAP portfolio reached RS. 8,107 crore, registering a growth of 13%. The Auto Loan portfolio grew by 2% to RS. 8,778 crore. The Bank continued to sharpen product propositions, refine policies, and strengthen internal processes and digital capabilities with the objective of improving productivity, enhancing customer experience, and reducing cost of acquisition. Select digital initiatives across mortgage and auto loan journeys were reviewed and enhanced to improve process efficiency, turnaround time, and scalability, while ensuring better alignment with business requirements and frontline usability.
In Auto Loans, the Bank continued to strengthen digital processing capabilities with a focus on faster decisioning, streamlined documentation, and improved operational consistency across channels. These interventions are expected to support better
customer experience and higher productivity while enabling the business to scale more efficiently.
The Bank also undertook policy and program refinements to strengthen sourcing in secured retail assets, with a particular focus on expanding the Loan Against Property opportunity. Key interventions included redefining LAP program parameters, broadening customer eligibility frameworks, and simplifying assessment approaches to support quality growth, improve customer engagement, and deepen relationships across targeted segments.
Credit & Debit Cards
The Credit Card and Debit Card businesses continue to be key drivers of revenue growth and market expansion for the Bank. With a diversified portfolio of products and reward offerings, the Bank caters effectively to varied customer segments and has strengthened its market position across both portfolios during FY 2025-26.
The Credit Card business recorded strong and sustained growth during the year, supported by focused customer acquisition, expansion of co-origination partnerships, and deeper penetration into the existing Savings Bank base. The portfolio spans premium, classic, and co-branded products tailored for young professionals, families, and HNI customers, offering differentiated value propositions such as cashback, travel benefits, and lifestyle privileges. Total spends in the Credit Card portfolio reached approximately RS. 27,500 crore, with sourcing and spends nearly doubling over the previous year.
The Bank has built a best-in-class digital ecosystem, enabling seamless onboarding, instant issuance of virtual cards, dynamic pricing (APR), and differentiated rewards architecture. Credit cards are currently issued on secured and pre-approved basis for existing customers, while new-to-bank customers can complete the end-to-end onboarding journey through a fully digital, frictionless platform.
Looking ahead, the Bank is well-positioned for further growth with the rollout of new co-branded partnerships and strategic initiatives aimed at enhancing market share. Over the past two years, the Bank has scaled both organic and fintech-led sourcing channels. In line with evolving regulatory requirements, the Bank is strengthening its fintech engagement model through upgraded delivery architecture and enhanced control frameworks. The resumption of business with a key fintech partner further augments growth opportunities while ensuring full regulatory compliance and customer-centric delivery.
In the Debit Card portfolio, spends moderated marginally during the year, reflecting an industry-wide shift towards UPI-based transactions. However, the Bank outperformed the industry trend and retained its position as the 4th largest Private Sector Bank in terms of Debit Card spends. Continued focus on customer engagement, innovative reward structures, and superior service delivery has enabled the Bank to maintain strong relevance in the evolving payments landscape.
Personal Loan
The Personal Loan business is sourced through a combination of organic and fintech channels. Organic sourcing continues to be driven by the Banks existing customer base, leveraging pre-approved offers, digital acquisition journeys and manual underwriting, contributing approximately 65% of total disbursements. Fintech partnerships have also emerged as a significant growth driver, accounting for 35% of overall sourcing and enabling access to new customer segments through seamless digital onboarding and real-time credit assessment. During FY26, Organic Personal loan portfolio grew at 8% to Gross ENR 2,534 Cr. witRs. 1,353 Cr. Disbursement. In FY26, Total Personal loan portfolio stood at 3,782 Cr. witRs. 1,875 Cr. Disbursement.
Portfolio growth continues to be guided by prudent underwriting standards, data-driven decision-making for pre-approved offers, and a strong risk management framework. The Bank leverages internal and external data sources, advanced scorecards, and continuous portfolio monitoring to maintain asset quality while expanding its presence across customer segments and geographies.
Looking ahead, the Bank remains well-positioned to accelerate growth in the Personal Loan business through enhanced digital capabilities, strategic partnerships, and targeted customer acquisition initiatives. Continued investments in analytics, process automation, and customer experience are expected to further strengthen market penetration while maintaining a balanced approach towards growth, profitability, and portfolio quality.
Agri Business
Agriculture, with its allied sectors, continues to be an essential sector of the Indian economy, employing nearly three-quarters of the population and contributing significantly to the countrys GDP. India has a rich agricultural history dating back thousands of years and its agricultural practices have evolved to meet the challenging needs of the population. India continues to be a dominant player globally in terms of export of Agri commodities. Your Bank is committed towards giving additional focus on this sector which holds a significant place in the Indian economy.
Your Bank offers all types of Agricultural products suitable for the farmer community to cater to their pre- and post-harvest requirements, infrastructure facilities, allied and ancillary related activities, etc which are delivered through the distribution channel spread across the country well supported by a specialised team of Agricultural relationship managers.
Your Bank was one of the pioneers in introducing the instant KCC digital product that has revolutionised the approach towards rural lending. Faster delivery of rural credit to the underserved was always a challenge in agricultural lending. To address this, your Bank has introduced digital version of the Kisan Credit Card scheme in association with Reserve Bank Innovation Hub (RBiH),
which presents a new experience to the farmer in terms of credit delivery. The entire process, which is a paperless, seamless one, takes the farmer through a digital journey starting from onboarding the customer to disbursement of the loan. Your Bank has entered into various partnerships to expand the digital journey and to cater to the varied needs of the farming community.
Core agricultural advances of your Bank have registered a steady growth in FY 2025-26 by introducing new array of products to cater to the Agri processing and infrastructure requirements of Agriculture sector with an outstanding of Rs.8,448 Crore as on March 31, 2026. Your Bank continued its focus on priority sector lending overachieving the targets & sub targets for Priority sector and Agriculture lending.
In the way forward, your Bank proposes Pan India expansion of Agricultural lending both through conventional and digital mode exploring newer geographies and new strategic partnerships. Your Bank is working on innovative models to explore the opportunities in Agri value chains concentrating mainly on plate to plough model of cultivation which would be demand driven. Bank also has future plans for collaborating with the corporates involved in the value chain and utilising the possibilities of structured finance lending models.
Gold Loans
Your Bank sustained its strong growth momentum in the gold loan segment during FY 2025-26, registering a robust YoY growth of 26% at an improved yield of 10.21%. This performance reflects the Banks continued focus on strengthening its core business through enhanced customer engagement, operational efficiency and channel expansion.
During the year, several initiatives were undertaken to improve service delivery and streamline processes. Customer outreach and responsiveness were strengthened through dedicated engagement channels, while new product variants were introduced to address evolving customer needs with greater flexibility in repayment structures. Process enhancements aligned with regulatory guidelines have simplified key customer journeys, making them more seamless for both customers and branches.
Digital transformation remained a central theme, with increased focus on the digitalization of documentation and process workflows, leading to improved transparency, faster turnaround times and enhanced operational efficiency. The Bank also strengthened its partnership ecosystem by enabling deeper collaboration with external partners, thereby expanding its reach and supporting business growth across geographies.
Looking ahead, Your Bank remains committed to driving innovation and diversification in the gold loan segment. The focus will be on products catering to a broader range of incomegenerating activities, scaling the CLA model and leveraging emerging technologies such as AI to further enhance efficiency and customer experience.
Through its continued emphasis on innovation, process excellence and customer-centricity, Your Bank is well-positioned to further strengthen its leadership in the gold loan segment.
Inclusive Finance
Your Bank is committed to ensuring that financial services are delivered in an equitable and unbiased manner, with a focus on accessibility across all sections of society. The Bank has consistently demonstrated leadership in identifying emerging opportunities and leveraging digital technology and evolving trends to support sustainable and inclusive growth.
Aligned with the core principle of extending credit where credit is due, Your Bank continues to drive financial inclusion initiatives through both Branch and agency channels. These efforts have contributed to meaningful socio-economic impact, particularly among underserved segments.
Through a network of 38 Corporate Partners, including Business Correspondents (BCs) and co-lending partners, Your Bank has facilitated the sourcing and servicing of small-value loans through robust Loan Origination Systems (LOS) such as Fedmi, Mifix, FedMithra with a specific focus on informal segment of the society, especially women beneficiaries.
Your Bank has operationalised SAHAYOG, a comprehensive platform for sourcing Self Help Group (SHG) savings and loan accounts, enabling an end-to-end paperless journey. The platform supports biometric-based member onboarding, member-level data capture, Micro Credit Plan (MCP) processing and direct credit of loan proceeds to members, thereby ensuring efficiency and timeliness in credit delivery. By integrating Branches, Business Correspondents and SHG Promoting Institutions (SHPIs), Your Bank continues to strengthen its financial inclusion framework and expand outreach to underserved communities. During the financial year, Your Bank has facilitated credit linkage of 2,876 SHGs through this platform.
These initiatives together have enabled outreach to more than 18 Lakh beneficiaries across 23 States and 2 Union Territories, reflecting a 6% YoY growth, with an outstanding portfolio of T 4,360 Crore.
Your Bank offers low-cost savings accounts under the Pradhan Mantri Jan Dhan Yojana (PMJDY), targeting underserved sections such as rural households, low-income groups, senior citizens and women including SHG members, with the objective of providing access to essential financial services, including savings, remittance, credit, insurance and pension, in an affordable manner. PMJDY accounts are zero-balance accounts with a RuPay debit card and include accidental insurance cover of T 2 Lakh. As on March 31, 2026, the Bank has opened 8,50,595 accounts, with an aggregate balance of T 491.14 Crore and an average balance of T 4,774.07.
Your Bank also actively promotes Government-backed social security schemes, including Pradhan Mantri Suraksha Bima Yojana (PMSBY), Pradhan Mantri Jeevan Jyoti Bima Yojana
(PMJJBY) and Atal Pension Yojana (APY). PMSBY and PMJJBY provide affordable insurance coverage for accidents, disability and life risks, while APY supports pension coverage for individuals in the unorganised sector. Your Bank remains committed to extending these benefits to all segments of the society with a focussed emphasis on the underserved segments, including women, individuals in rural and hard-to-reach areas, low-income households etc and during the financial year 2025-26, fresh enrolments contracts under these schemes stands at 71715 (PMJJBY), 160211 (PMSBY) and 30005 (APY).
Financial Literacy through Rural Branches
Financial inclusion initiatives are complemented by Your Banks continued focus on financial literacy, aimed at creating awareness on financial products, responsible borrowing and digital banking usage among underserved populations. Recognising financial literacy as a key enabler, Your Bank has embedded social commitment as a core operating philosophy.
During the financial year, 234 Rural Branches of Your Bank conducted 2,164 financial literacy camps, reaching 21,575 participants, thereby strengthening awareness and facilitating informed financial decision-making among target segments.
Treasury and International Operations Treasury & Markets
Treasury manages the crucial functions of maintaining the statutory reserves as well as liquidity of the Bank under the close coordination of ALCO by raising resources required to support the credit book and deploying the surplus resources optimally. Intraday and overall liquidity management is done by considering various options/ instruments through which the Bank can raise short-term/ long-term funds at competitive rates. Treasury is active in various Money Market Segments such as Certificate of Deposits, Repo markets etc. for generating liquidity. The Money Markets desk also seeks opportunities for Refinance by specific Institutions. Apart from liquidity management and reserves maintenance, Treasury manages the Investments of the Bank and utilises the trading and arbitraging opportunities across different markets. The unit undertakes active hedging and cover operations for both proprietary/Balance Sheet positions and client portfolios to address foreign exchange and interest rate risks. The Treasury dealing room is located in Mumbai with a disaster recovery site at Kochi. Your Bank has dedicated full-fledged dealing desks in the major market segments namely, Foreign Exchange Interbank Derivatives-Currency Options / Cross Currency Swaps / Interest Rate Swaps, T-bill/Rupee Swaps, Currency Futures, Interest Rate Futures, Overnight Index Swaps, Non-Deliverable Forwards, NonDeliverable Currency Options, Bond Forward Rate Agreements, Bond Forwards, Foreign currency credits, Gold Metal Loan and in the Domestic markets - Money Market, Government Securities, Corporate bonds and Debentures, Certificates of Deposit, Commercial Paper, Interest Rate Swaps and Equity. The Non-SLR desk of your Bank actively manages the NSLR portfolio. Your Bank also provides a web-based trading platform and intraday trading facilities to clients in the CSGL segment. Treasury activities are further being augmented by a robust Front Office System which
efficiently captures all the front-end dealings of the Bank and has robust risk management and monitoring capabilities. Your Bank as a prudent measure partially hedged its floating rate loan book to insulate from the lowering of the benchmark interest rates by RBI.
The Treasury Sales team, spread across the country, collaborates closely with the coverage team to deliver tailored risk management solutions. The team comprises dedicated relationship managers catering to diverse customer segments, including Branch and Business Banking, Commercial Banking and Corporate & Institutional Banking Group clients. Together, they support a wide client base in effectively hedging risks arising from foreign exchange and interest rate exposures.
The Bank has also initiated the onboarding forex customers onto a centralized digital platform, enabling them to directly book rates in the market, thereby enhancing efficiency and transparency.
With a strong focus on best-in-class service delivery, customized solutions and optimal use of technology, the Bank has established itself as a preferred partner across client segments. Its core strength lies in providing structured risk management solutions, expert hedging advisory and seamless execution capabilities, making it a trusted Treasury solutions provider for clients.
The Interbank Desk caters to nearly one-fifth of the countrys personal inward remittances and continues to be a significant participant in the Interbank market. During FY 2025-26, the Bank recorded its highest-ever cross-border remittance inflows. This strong performance has been further supported by the strategic use of data analytics to gain deeper insights into customer business, enabling the Bank to effectively enhance its forex business across the branch network.
The Financial Institutional Sales team handles discussions with institutional clients such as banks, insurance companies, mutual fund companies, alternate investment funds (AIFs) and other similar organizations to build broader engagement and explore treasury business opportunities.
Your Bank has been giving thrust to the development of the forex business and is continuously working to improve the operating skills of relevant personnel through meetings, interactions and training programs. Your Bank is also at the forefront of conducting Foreign Exchange Dealers Association of India (FEDAI) training programs for the banking fraternity. This enables the designated branches to improve their operating efficiency substantially. Your Bank is a member of the Managing Committee of FEDAI and a member of FAI.
IFSC Banking Unit (IBU)
Your Bank opened its IFSC Banking Unit (IBU) at Indias first International Financial Service Centre (IFSC) located at GIFT City (Gandhinagar, Gujarat) in November 2015. IFSC in GIFT City is conceptualised and designed at par with other global financial centres operating in various parts of the world viz. Hong Kong, Dubai, Singapore, etc. The branch is like an overseas branch situated in an overseas jurisdiction, enabling your Bank to explore international business opportunities.
Various products offered and activities handled by the Federal Bank IBU are:
• Credit facilities to overseas companies, Wholly Owned Subsidiaries (WOS)/ Joint Ventures (JV) of Indian companies registered abroad.
• Deposit and loan facilities to Retail Individuals, including Non-residents Individuals.
• External Commercial Borrowings (ECB), Trade Credit to Indian Entities.
• Acceptance of foreign currency corporate deposits.
• Facilities to entities in GIFT IFSC ecosystem
• Treasury operations.
• Capital Market segment
• Empanelled with NSEICC for Issuance of FDs & BGs as a collateral
• Empanelment as Registered Distributor for Capital Market Product and Services
With the opening of IBU, your Bank caters to both domestic and international clients for their various funded and nonfunded banking requirements in multiple jurisdictions. IBU has undertaken transactions with clients across various geographies covering more than 34 countries. IBU boosts the balance sheet of your Bank by empowering it to extend various foreign currency facilities to entities and individuals across various foreign jurisdictions. Federal Bank through its IBU has executed transactions in various segments like aviation, chemicals, pharma, manufacturing & trading, metals, media & entertainment, health care, electrical, food, construction, retail, IT, finance, NBFCs etc. Your Bank has received approval in FY 2025-26 to act as Registered Distributor to distribute capital market products and services across IFSC, India and foreign jurisdictions to various investors. With this enabler in place, your Bank can now refer clients to GIFT City based service providers (e.g., mutual funds, AIFs, PMS) under distribution partnerships for distribution of Capital marker products and services. Also, the Bank through its IBU, is active in booking sustainability and linked facilities and is an active participant in various fintech initiatives from GIFT City.
Fee-Based and Distribution Businesses Wealth & Bancassurance
The Bank provides a wide range of insurance solutions, including life, health and general insurance, aimed at protecting customers against financial uncertainties and ensuring their long-term financial security. Strengthening Product Per Customer (PPC) remains a key focus, supported by delivering suitable products through multiple channels such as branch banking, digital platforms and telesales.
Bancassurance demonstrated strong YoY growth of 67% to reacRs. 389.33 Crore, largely driven by exceptional performance in the life insurance segment. Fee income from life insurance rose by 80% YoY
to reacRs. 339.66 Crore, supported by increased retail penetration, stronger branch-led sales conversions and a continued emphasis on protection and long-term savings solutions.
Meanwhile, non-life insurance fee income grew by 13% YoY to reacRs. 49.67 Cr, supported by steady demand for health, motor and other protection-oriented products tailored to customer needs
FY 2025-26 has been a landmark year for Federal Banks Wealth Management business, marking a significant strategic transformation. The Bank established a dedicated Wealth Management vertical, restructuring its longstanding referral arrangement with EWPL and setting up a new department with robust operational frameworks. Highly skilled professionals were recruited to drive this initiative, resulting in a more specialised and customer-centric approach. To further strengthen its offerings, the Bank launched a state-of-the-art technology platform, enhancing digital capabilities and expanding wealth products for Mass Affluent customers. In the initial phase, a comprehensive suite of products—including Mutual Funds (MFs), Portfolio Management Services (PMS) and Alternative Investment Funds (AIFs)—was introduced for Affluent customers. Looking ahead, the Bank is poised to launch its Gift-city offering for NRIs and LRS customers, broadening its reach.
While preparing to launch its Wealth business, the Banks partnership with Equirus Wealth Pvt Ltd (EWPL) saw AUM under referral grow 16% YoY to over ^7,200 Crore as of 31/03/2026. The number of active customers availing Wealth Management Services (WMS) under the EWPL arrangement reached 37,315, registering a YoY growth of 24% as on March 31, 2026. Additionally, the Bank managed ^683 Crore of Mutual Funds AUM under its own ARN as of the same date. Total fee income earned under WMS stood at ^34.80 Crore, demonstrating a strong YoY growth of 32%. These achievements underscore the Banks commitment to delivering superior wealth management solutions and driving sustained growth in this sector.
SCKS
Digital, Technology and Innovation Digital Banking Transformation
Digital transformation continues to be the defining strategic pillar of your Bank and FY 2025-26 stands as a landmark year of measurable impact, ecosystem leadership and breakthrough innovation. Driven by a relentless pursuit of superior customer experiences and a commitment to making banking more accessible, intuitive and secure for every customer, your Bank recorded a digital transaction share of 93.91% during the year — surpassing the 92% achieved in the previous fiscal. The overall mobile banking monthly transaction volume crossed ^33,275 Crore for FY 2025-26, with the flagship retail platform FedMobile contributing ^20,704 Crore and the corporate banking platform FedCorp contributing ^12,570 Crore — together reflecting the remarkable depth of digital adoption across retail and corporate customer segments alike.
In order to deliver personalized, contextual and real-time financial services, your Bank continues to harness the transformative power of next-generation technologies, including Artificial Intelligence, Machine Learning, Generative AI and Agentic AI.
Your Bank remains steadfast in its commitment to building user- friendly, frictionless, secure and engaging digital experiences seamlessly across all channels and touchpoints.
Your Banks comprehensive digital ecosystem — anchored by FedMobile, FedCorp, FedNet and the AI-powered virtual assistant Feddy — continued its strong upward trajectory throughout FY 2025-26. Each platform received meaningful capability enhancements, with deliberate emphasis on customer experience improvements, product depth and ecosystem interoperability — firmly cementing your Banks position as one of Indias most forward-thinking digital banking institutions.
The FedMobile application reached a significant milestone in FY 2025-26, recording highest number of Monthly Active Users and monthly transacting users. The platforms app rating improved from 4.4 stars to 4.6 stars on Android and from 3.6 stars to 4.6 stars on iOS — a best-in-class standard within the Indian banking industry — reflecting the sustained focus on customer experience and platform quality that has come to define your Banks digital strategy.
Federal Bank continued its digital leadership journey in FY 202526, achieving strong and consistent growth across all key digital metrics. Through sustained product innovation and disciplined execution, your Bank not only met but significantly exceeded several critical digital targets, while simultaneously establishing a series of industry and ecosystem firsts that have elevated its national standing among regulators, industry bodies and customers alike.
Feddy, your Banks AI-powered virtual assistant, delivered a transformative year in FY 2025-26. Monthly query volumes crossed the 4-Lakh milestone for the first time, reaching 4.05 Lakh queries in March 2026, An overall AI query resolution rate of 93% was achieved for eligible queries. Feddy has significantly reducing dependency on the Banks contact center - call volumes are stagnant since Feddy was introduced, enabling customers to resolve their banking needs faster and more conveniently than ever before.
CBDC (e^) Pilot
85K
Active Users
CBDC adoption witnessed robust growth, with CBDC-BBPS integration made live and the Android application achieving a 4.9-star rating on the Play Store.
During FY 2025-26, your Bank has launched the following Digital initiatives:
FedMobile Enhancements:
During the year, your Banks flagship mobile banking platform, FedMobile, underwent comprehensive enhancements — introducing a wide suite of new capabilities, a significantly improved user experience and elevated security protocols. A broad range of new product journeys were introduced and made available to customers during the year, including RuPay Credit Cards, Personal Loans, Bharat Bill Payment System (BBPS), the In-House Investment Channel (IIC) for mutual funds, the National Pension System (NPS), Pravasi Insurance, BYOM Loans, NRO
Account Opening, AFLIC Life Insurance, Auto Bill Payments & Bill Reminder Functionalities. Two landmark modules were introduced during the year: the Unified Credit Card Module, which consolidates all our credit card services into a single, frictionless, SSO-integrated customer journey; and the In-House Investment Channel, which enables end-to-end mutual fund investments directly within FedMobile under your Banks own AMFI Registration Number.
Customer experience improvements during the year included the integration of an International Virtual Mobile Number (VMN) — which delivered a significant improvement in GCC customer authentication success rates — the integration of the ReKYC portal for seamless KYC renewal and the implementation of Single Sign-On (SSO) capability across key service journeys. These enhancements collectively delivered a materially superior and more secure banking experience to millions of customers transacting through FedMobile.
In-House Investment Channel (IIC) — New Revenue Engine:
The launch of the In-House Investment Channel (IIC) in December 2025 represents one of the most strategically significant milestones of FY 2025-26 for your Banks digital offerings. By operating under the Banks own AMFI Registration Number (ARN), IIC enables customers to invest in mutual funds — through both Systematic Investment Plans and lump-sum transactions — entirely within the FedMobile application, without any redirection to external platforms. This integration ensures a seamless, end- to-end investment experience that is fully embedded within the customers existing banking relationship with your Bank.
The channel has demonstrated strong early adoption, reflecting the growing appetite among your Banks customers for integrated, convenient wealth management solutions within their mobile banking experience.
Unified Credit Card Module & Card Journey Execution:
Your Bank significantly strengthened its credit card digital ecosystem during FY2025-26 through the introduction of a Unified Credit Card Module on FedMobile. This module consolidates all credit card services — encompassing balance enquiry, statement access, payment processing, limit management, EMI conversion, rewards redemption and card activation workflows — into a single, seamlessly integrated journey with SSO support. The simplified, frictionless design has materially enhanced the end- to-end credit card experience for customers.
Feddy:
Feddy, your Banks AI-powered virtual assistant, is designed to serve customers round-the-clock across WhatsApp, the Banks website and other digital touchpoints — enabling financial transactions, conversational banking, bill payments, fund transfers and comprehensive query resolution through an intuitive, human-like interface. In FY 2025-26, Feddy was elevated to a significantly higher level of capability, intelligence and reach within your Banks digital architecture.
A major advancement during the year was the activation of Feddys Next Best Conversation (NBC) and Next Best Offer (NBO) capabilities. These AI-driven features enable Feddy
to proactively recommend relevant products and services to customers based on behavioral signals and contextual data. Your Banks Generative AI roadmap has been defined and it will drive the next phase of Feddys evolution, enabling even more sophisticated, contextually aware and multi-modal interactions in the coming year.
Feddy is available in 14 Indian languages, with Voice Note support on WhatsApp enabling customers to interact naturally through spoken messages in their preferred language — further advancing your Banks commitment to linguistic inclusivity and accessible banking for every segment of the population.
FX Retail — NPCI BharatConnect (Industry First):
In a landmark achievement for your Bank and the nations foreign exchange digital payment infrastructure, Federal Bank became one of the first banks in India to go live on NPCI Bharat Connects FX Retail platform, on both the Bank of Utility (BoU) and Customer of Utility (CoU) sides. This initiative, undertaken under the mandate of NBBL with oversight from the Reserve Bank of India, was accomplished in a remarkably short period. This achievement places Federal Bank at the forefront of Indias crossborder digital payment evolution and reflects your Banks agility, technical capability and deepening regulatory partnerships.
FedCorp:
FedCorp, your Banks corporate mobile banking platform, delivered an outstanding growth story in FY 2025-26, catalyzed by a complete platform revamp launched in April 2025 that drove a step-change in usability, feature depth and user adoption. Monthly transaction volume surged by 91.2% YoY and the active user base expanded by 64%
IBMB Interoperability — Internet & Mobile Banking Multi-Bank Platform:
Your Bank achieved another significant ecosystem milestone during FY 2025-26 by going live as an issuer on NBBLs Internet and Mobile Banking Multi-Bank (IBMB) interoperability platform. Federal Bank is one of only five banks nationally to be live on this platform- enabling seamless e-commerce and digital banking transactions for customers across internet and mobile banking channels. The capability was officially launched by the Governor of the Reserve Bank of India at the Global Fintech Fest 2025, marking a moment of distinguished public recognition for your Banks commitment to digital innovation.
UPI and IMPS:
UPI has continued to be a defining growth engine for your Bank and FY 2025-26 was a year of record-setting performance across every dimension. Several significant UPI feature advancements were accomplished during the year, including UPI Biometric Authentication and UPI PIN Set/Reset through UIDAIs Face Authentication — both launched at the Global Fintech Fest 2025. These capabilities further enhance the security, convenience and reach of UPI-based banking for your Banks customers.
The Immediate Payment Service (IMPS) channel also delivered strong results in FY 2025-26 Your Bank was recognized as a Top 2 Remitter Bank for Last-Mile Inward Remittance by NPCI, with an approximately 30% market share in last-mile inward remittance.
CBDC:
Your Bank joined the CBDC ecosystem in Dec 2022 and has since emerged as one of the most active and capable participants in this transformative initiative. In FY 2025-26, CBDC adoption on your Banks platform witnessed robust growth in transaction volumes YoY, reflecting both deepening customer engagement and the broadening of use cases supported on the platform.
During the year, your Bank successfully completed the UTXO architecture migration mandated by the Reserve Bank of India — executed by a dedicated in-house team within record timelines. CBDC-BBPS integration was made live, enabling customers to use their CBDC wallets for bill payment services. The CBDC application achieved a 4.9-star rating on the Play Store.
NETC / FASTag:
Your Banks FASTag and National Electronic Toll Collection (NETC) operations recorded outstanding performance in FY 2025-26, earning national recognition for service quality. Your Bank secured the #1 rank in the NPCI NPS Ranking for NETC in July 2025, reflecting the tangible impact of customer experience investments. The Multi-Lane Free Flow (MLFF) project was delivered on time and duly certified by NPCI during the year — positioning your Bank at the vanguard of next-generation tolling infrastructure in India.
Merchant Acquiring — Retail & Government Business:
Your Bank continued to drive strategic improvements across its merchant acquiring operations during FY 2025-26, with particular emphasis on partnership expansion and bespoke solutions delivery. During the year, Various new government and institutional partnerships were concluded, including the marquee ones.
Gold Loan Digital LOS (GL 2.5 / GL Bridge):
Your Bank delivered the Gold Loan Origination System (LOS) — codenamed GL 2.5 / GL Bridge — in just 2.5 months, ahead of the regulatory deadline. Built entirely in-house, this platform completely transformed the Gold Loan documentation and document execution process by enabling end-to-end digital documentation. All executed customer documents are now digitally stored, eliminating the need for physical storage and significantly improving operational efficiency, document accessibility, security, turnaround time and paper saving.
Platform & Product Transformation Programmes:
FY 2025-26 marked a year of bold, structured transformation across your Banks core digital platforms, with every major programme milestone delivered strictly within committed timelines — a record that reflects the maturity, discipline and execution rigor of your Banks Digital Centre of Excellence. These included the Omnichannel Platform (Unitus), Unified Loan Origination System (Primus) and the Unified Account Opening (Novus)
Deflect to Digital (Project Udaan):
Project Udaan represents your Banks structured programme to accelerate digital adoption at the branch level. In Phase
1,100 branches were equipped with trained digital apprentices empowered to assist customers with passbook printing, cash deposits and withdrawals, account opening and KYC — all facilitated through digital channels. Phase 2, covering additional branches, is planned for the coming year, further deepening your Banks commitment to making digital banking accessible and intuitive for every customer.
Fintech Partnerships
The Indian fintech industry during FY 2025-26 continued to evolve into a highly integrated, multi-layered ecosystem anchored by strong digital public infrastructure, progressive regulation and rapid technological innovation. At its core lies Indias Digital Public Infrastructure—including UPI, Aadhaar and the Account Aggregator framework—which has enabled seamless interoperability, low-cost customer onboarding and data-driven innovation across financial services. The industry operates through a collaborative structure where banks providing regulatory and capital support, alongside fintech firms driving customer acquisition, digital interfaces and product innovation across payments, lending and wealth management, segments. This structure has fostered a partnership-led operating model, with increasing adoption of co-lending, embedded finance and platform-based distribution strategies.
Your Banks Strategy on FinTech Partnerships
Your Bank continues to view FinTech entities as strategic collaborators rather than competitors, recognizing their role in accelerating innovation, enhancing agility and expanding market reach. FinTech partners bring specialized technological capabilities, rapid product development cycles and deep customer insights, which, when combined with the Banks scale, strong regulatory framework and established customer trust, enable the delivery of differentiated and customer-centric financial solutions. As a result, your Bank has positioned itself as a preferred partner for FinTech collaborations across the country.
These partnerships are aligned with your Banks dual strategic objectives of expanding the distribution footprint of its products and services while simultaneously integrating advanced technological capabilities to enhance customer experience and engagement. Your Bank leverages such collaborations to access new customer segments, particularly in digitally underserved geographies where physical presence may be limited, thereby supporting the acquisition of new-to-bank customers.
Way Forward
Building on the strong momentum witnessed in credit card sourcing through FinTech partnerships and the growing traction in the digital personal loan segment, the Bank is well-positioned to sustain and further accelerate its partnership-led growth trajectory in FY 2026-27. The Bank has developed a robust pipeline of new FinTech collaborations, which are expected to be live in the upcoming financial year. These initiatives are expected to play a key role in driving incremental customer acquisition, deepening digital engagement and further strengthening the Banks digital product suite, thereby supporting its broader strategic objective of expanding its presence in the digital financial ecosystem.
Information Technology
Technology continues to be a key enabler of Your Banks operational excellence, risk management and business transformation initiatives. During FY 2025-26, Your Bank continued to strengthen its technology landscape through investments in platform modernisation, automation, cyber security, analytics and infrastructure resilience. These initiatives were aimed at improving operational efficiency, enhancing system scalability and supporting the Banks evolving business and regulatory requirements.
Major Projects Completed in FY 2025-26 CRISIL ICON - Credit Risk Platform
Your Bank continued to leverage CRISIL ICON, an integrated digital credit risk platform that enables unified management of rating models, scorecards and credit workflows. The platform has strengthened credit assessment capabilities, improved governance and enhanced efficiency in credit decisionmaking processes.
API Gateway Modernisation
As part of the Banks API-first architecture strategy, the API Gateway platform was enhanced to provide secure, standardised and scalable integrations across internal applications and external ecosystems. The initiative has reduced integration complexity, improved governance and accelerated deployment of technology solutions.
Fraud Risk Management Platform Enhancement
Your Bank strengthened its fraud monitoring capabilities through enhancements to the Fraud Risk Management (FRM) ecosystem. Advanced monitoring and analytics capabilities have improved real-time transaction surveillance, fraud detection and risk mitigation across multiple banking channels.
Proactive Risk Manager (PRM) Upgrade
The Bank upgraded its Proactive Risk Manager (PRM) platform to strengthen behavioural monitoring, non-financial transaction surveillance and fraud prevention capabilities. The upgraded platform supports improved risk identification and enhanced monitoring efficiency.
Compliance Management System
A centralised Compliance Management System was implemented to streamline compliance tracking, regulatory monitoring and reporting processes. The platform has improved visibility, governance and operational efficiency across compliance functions.
Asset Liability Management (ALM) Automation
Your Bank enhanced its ALM framework through automation of monitoring and reporting processes. The solution enables efficient consolidation of data from multiple sources and supports timely regulatory and management reporting.
Hardware Security Module (HSM) Integration
The Bank strengthened its information security infrastructure through Hardware Security Module (HSM) integration, enabling secure encryption key management and enhanced protection of sensitive payment and authentication processes.
Enterprise Backup and Resilience Framework
Your Bank continued to strengthen business continuity and disaster recovery capabilities through enhanced backup infrastructure, immutable storage mechanisms and improved recovery processes, supporting operational resilience and regulatory compliance.
Cyber Security and Infrastructure Security Initiatives
During the year, Your Bank further enhanced its cyber security posture through expanded vulnerability assessment and penetration testing coverage, strengthened monitoring capabilities, security automation initiatives, breach simulation exercises and improved threat detection mechanisms. These initiatives continue to support a secure, resilient and compliant technology environment.
Additional information on the Banks Digital & IT Initiatives is provided on Pg966 of the Integrated Annual Report.
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Customer Experience and Service Quality
Your Bank remains committed to delivering superior customer experiences through a customer-centric approach anchored in service excellence, accessibility and trust. During FY 2025-26, the Bank continued to strengthen its service delivery framework through process transformation, technology-enabled enhancements and structured customer engagement initiatives. More than 100 process improvements were implemented across customer touchpoints during the year, helping reduce friction, improve turnaround times and enhance overall service efficiency. Strengthened contact centre capacity, upgraded self-service platforms and continuous improvements across branch and digital channels further supported a seamless and responsive banking experience.
Customer feedback continued to play a central role in shaping service improvements. The Bank expanded Net Promoter Score (NPS) measurement across additional customer touchpoints, including branches, contact centres and digital journeys, enabling deeper insights into customer expectations and experience quality. Feedback mechanisms across products, services and customer interactions are systematically reviewed and leveraged to refine processes, improve responsiveness and enhance customer satisfaction. A robust customer grievance redressal framework, supported by periodic reviews at multiple governance levels, continues to strengthen service quality, transparency and customer protection across the organisation.
Your Bank also continued to strengthen customer trust through proactive awareness initiatives on cyber security, fraud prevention and safe digital banking practices. In addition, focused efforts
towards accessibility and inclusive banking are helping ensure a convenient and dignified banking experience for all customer segments. Going forward, Your Bank will continue to leverage data analytics, artificial intelligence and customer insights to further personalise experiences, strengthen customer engagement and deliver consistent service excellence across all channels.
Marketing
FY 2025-26 marked an important phase in Your Banks brand evolution as it continued to strengthen customer engagement under the Rishta philosophy and the 3S framework of Segment, Scale and Sustain. These guiding principles remained central to the Banks efforts to build deeper customer relationships, enhance brand relevance and deliver more personalised experiences across customer segments.
During the year, Your Bank strengthened its brand identity through the rollout of its refreshed positioning, Familiar, Yet Fresh™, aimed at creating a more contemporary, consistent and distinctive customer experience across physical and digital touchpoints. The continued association with brand ambassador Vidya Balan further reinforced the Banks Human at the Core philosophy, helping strengthen emotional connect and brand relatability across diverse customer segments. Leveraging data analytics, customer insights and artificial intelligence-enabled marketing capabilities, the Bank enhanced campaign effectiveness, accelerated content development and improved customer engagement through more relevant and timely communication.
Your Bank also expanded its focus on regional and vernacular marketing initiatives to deepen customer connect across geographies while maintaining a consistent brand identity. At the same time, digital trust campaigns and cyber security awareness initiatives continued to support responsible banking and strengthen customer confidence in an increasingly digital environment. Through a combination of meaningful storytelling, digital innovation, community engagement and customercentric communication, Your Bank continues to strengthen its brand equity and build enduring relationships with customers across markets.
Additional information on the Banks marketing initiatives is provided on Pag324 the Integrated Annual Report.
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Risk Management
The risk management philosophy of Your Bank is to take risk by choice rather than by chance. Your Bank continues to focus on building a resilient and sustainable franchise through a disciplined approach to risk identification, assessment, monitoring and mitigation. Given the inherent nature of banking operations, Your Bank is exposed to various risks including credit risk, market risk, liquidity risk, information and cyber security risk and operational risk. To effectively manage these risks, Your Bank has established a comprehensive risk management framework comprising robust policies, governance structures, monitoring mechanisms and control systems.
During FY 2025-26, Your Bank further strengthened its risk management capabilities through enhanced analytics-driven monitoring and improved early warning frameworks. The Early Warning Signals (EWS) framework was reviewed and strengthened to support proactive identification and mitigation of emerging credit risks. In addition, the Bank established the Data Analytics and Market Intelligence (DAMI) unit to leverage advanced analytics, market intelligence and technology-enabled solutions for strengthening risk assessment, portfolio monitoring and decision-making processes. The Bank also transitioned to a centralised monitoring approach and created specialised portfolio-based monitoring verticals to improve efficiency, regulatory compliance and focused risk oversight across business segments.
• The Board of Directors oversees and approves the risk policies and strategies to establish an integrated risk management framework and control environment across Your Bank.
• The Risk Management Committee of the Board (RMCB) oversees the management of various risks associated with business activities, systems and processes.
• Executive-level committees ensure the effective implementation of risk management policies and risk governance practices across the organisation.
• The Integrated Risk Management Department, headed by the Chief Risk Officer, coordinates risk management activities and ensures alignment with the Banks risk appetite framework.
• An independent risk governance structure ensures the segregation of risk measurement, monitoring and control functions, thereby strengthening risk oversight and accountability.
The risk management framework is reviewed and upgraded on an ongoing basis in line with regulatory requirements, evolving market conditions and emerging industry best practices. Through disciplined risk management, analytics-led monitoring and a strong governance framework, Your Bank remains focused on maintaining asset quality, strengthening resilience and supporting sustainable long-term growth.
Additional information on key risks and mitigation strategies is provided on Pag3Q8 of the Integrated Annual Report.
Human Resources
Your Banks human capital remains a key enabler of its strategic priorities, transformation agenda and long-term value creation. As on March 31, 2026, Your Bank employed 17,681 individuals, with a gender ratio of 58:42, reflecting its continued commitment to building a diverse, equitable and inclusive workplace. The Banks people strategy is anchored in continuous learning, leadership development, employee wellbeing and the digitisation of people processes, enabling employees to adapt to evolving business requirements while building long-term careers within the organisation.
Recognising that organisational transformation is driven by people, Your Bank continued to invest significantly in capability building during the year. Training coverage across the organisation stood at 91.8%, with employees receiving an average of 45.87 training hours during the year. The Bank delivered over 7.32 Lakh person-hours of training and facilitated more than 5.41 Lakh hours of employee reskilling and digital learning initiatives. These efforts were supported by an investment of ^14.09 Crore towards employee training, skill upgradation and development, reinforcing the Banks commitment to building a future-ready workforce.
Employee and Worker Relation Management System
Your Bank continues to maintain a constructive employee and worker relations framework founded on mutual respect, open communication and collaborative engagement. As on March 31, 2026, 15,012 employees, representing 84.9% of the workforce, were covered under collective bargaining arrangements. Through structured engagement mechanisms, periodic interactions with employee representatives and a culture of transparency, Your Bank continues to promote a harmonious and inclusive work environment that supports employee wellbeing, organisational effectiveness and sustainable growth.
Additional information on the Banks human resource practices is provided on P^g^E^ of the Integrated Annual Report.
Corporate Social Responsibility
The Corporate Social Responsibility (CSR) initiatives of Your Bank are guided by a commitment to creating sustainable and inclusive impact across communities. Implemented through the Federal Bank Hormis Memorial Foundation (FBHMF), the Banks CSR programmes focus on key areas such as education, healthcare, livelihood enhancement, women empowerment and environmental sustainability. During FY 2025-26, Your Bank further strengthened its impact-led CSR approach through scalable flagship programmes, expanded geographic outreach and targeted interventions aligned with community needs.
With a CSR allocation of ^93.49 Crore and utilisation of ^75.33 Crore during the year, Your Bank continued to invest in initiatives that create meaningful and measurable social outcomes. Through programmes such as Federal Skill Academies, Sanjeevani, scholarship initiatives and community development projects, the Bank reached over 1,01,295 direct beneficiaries, while large-scale awareness and outreach programmes extended its impact to an estimated 11.04 Crore indirect beneficiaries across the country.
Additional information on the Banks CSR initiatives and impact stories is provided on PagBB05 of the Integrated Annual Report.
Subsidiaries And Associates
Your Banks subsidiaries and associate companies continue to play an important role in strengthening its diversified financial services ecosystem and enhancing customer value propositions across operations, lending, insurance and financial services. During FY 2025-26, these entities continued to support the Banks growth strategy through business expansion, operational excellence, technology-led innovation and customercentric initiatives.
Federal Operations & Services Limited (Fedserv)
Federal Operations & Services Limited (FedServ), a wholly-owned subsidiary of Your Bank, continued to strengthen its position as the Banks integrated operations and technology partner during FY 2025-26. Since its inception in 2018, FedServ has evolved from an efficiency-led centralisation initiative into a capability-driven strategic partner supporting the Banks operational excellence, technology transformation and customer experience agenda.
During the year, FedServ further expanded its scale and capabilities, managing 232 activities across 88 banking processes under 12 RBI-approved categories. Your Company supported over 200 critical processes while maintaining KPI adherence levels exceeding 95%, reinforcing its role as the Banks centralised operations backbone. Through process standardisation, automation, governance enhancements and business process transformation initiatives, FedServ continued to improve operational efficiency, turnaround times and service quality across the organisation.
Financial Performance
| Particulars | FY 2024-25 | FY 2025-26 |
| Revenue from Operations | 102.86 | 133.62 |
| Total Income | 105.13 | 135.03 |
| Profit Before Tax | 8.92 | 12.30 |
| Net Worth | 33.67 | 39.44 |
FedServ delivered strong financial growth during FY 2025-26, with revenue from operations increasing by 29.9% to ^133.62 Crore and total income rising by 28.4% to ^135.03 Crore. Net worth increased to ^39.44 Crore from ^33.67 Crore in the previous year, reflecting continued strengthening of your Companys financial position.
Operational Excellence and Process Transformation
FedServ continued to play a pivotal role in enhancing the Banks operational efficiency through centralisation, standardisation and automation. Your Company delivered measurable improvements in turnaround times and process accuracy during the year.
| Process Improvement Indicator | FY 2024-25 | FY 2025-26 |
| Completions within 4 Hours | 33% | 49% |
| Delays Beyond 48 Hours | 36% | 10% |
| Checker-to-Maker Rejections | 16% | 8% |
Key initiatives undertaken during the year included:
• Project Optima to improve account-opening efficiency and monitoring
• Deployment of Robotic Process Automation (RPA) across select operational processes
• Strengthening of Document Management Systems (DMS) and workflow digitisation
• Establishment of a dedicated Business Process
Transformation (BPT) function leveraging Six Sigma methodologies
• Enhanced training, certification and capability-building frameworks to improve process quality and consistency
These initiatives contributed to faster customer onboarding, improved First Time Right (FTR) metrics, reduced rework and a more consistent customer experience.
Customer Service and Delivery Capabilities
FedServ handled approximately 1.92 Lakh customer interactions during FY 2025-26 while maintaining service levels above 94% and Net Promoter Scores (NPS) in the range of 86-87. Your Company continued to support customer acquisition, servicing and sales enablement activities across multiple banking products and channels.
During the year, FedServ successfully established the Coimbatore Operations Centre in less than 50 days, further strengthening business continuity, operational resilience and delivery capacity. Your Company now operates across Kochi, Visakhapatnam, Bengaluru, Indore and Coimbatore with a combined delivery capacity exceeding 1,200 seats.
Strategic Priorities
Going forward, FedServ intends to further expand its operational portfolio, strengthen technology and digital capabilities, enhance automation-led efficiencies and deepen its role as the Banks preferred operations and technology execution partner. Key focus areas include expansion into additional service categories, scaling analytics and automation capabilities, strengthening business process transformation initiatives and optimising delivery infrastructure across locations.
Fedbank Financial Services Limited (Fedfina)
Established in 1995 and promoted by the Federal Bank, Fedbank Financial Services Limited (Fedfina) is a retail-focused NonBanking Financial Company (NBFC) catering primarily to selfemployed individuals, MSMEs and emerging entrepreneurs through secured lending products. Your Company continues to focus on building a scalable and sustainable lending franchise through prudent risk management, customer-centric products and technology-led operational excellence.
During FY 2025-26, Fedfina continued to strengthen its market position through branch expansion, growth in secured lending, improved asset quality and enhanced capital efficiency.
The Focus
• Fedfina remains focused on secured retail lending with emphasis on:
• Gold Loans
• Loan Against Property (LAP)
• Housing Finance
• MSME Lending
Your Company continues to serve the financing needs of selfemployed individuals, traders, small business owners and emerging entrepreneurs while maintaining a strong focus on asset quality and sustainable growth.
Business Performance
Fedfina recorded another year of strong business growth, supported by branch expansion, increased market penetration and strong momentum in gold loans.
Your Company expanded its footprint by opening 148 new branches during FY 2025-26, taking the network to 757 branches. Through its innovative Vyapar co-location model, 70 LAP branches were integrated with existing gold loan branches, improving operating efficiency and enabling cross-selling opportunities. Your Company also entered 174 new markets during the year, strengthening its presence across rural and semiurban geographies.
Disbursements
| Particulars | FY 2024-25 | FY 2025-26 |
| Gold Loan | 14,602 | 28,326 |
| Mortgage Loans | 3,307 | 3,084 |
| Medium Ticket LAP | 2,303 | 2,180 |
| Small Ticket LAP & Housing | 1,004 | 904 |
| Unsecured Business Loan | 878 | 0 |
| Total | 18,788 | 31,410 |
Assets Under Management
| Particulars | FY 2024-25 | FY 2025-26 |
| Gold Loan | 5,880 | 10,352 |
| Mortgage Loans | 8,062 | 9,362 |
| Medium Ticket LAP | 4,394 | 5,570 |
| Small Ticket LAP & Housing | 3,668 | 3,792 |
| Unsecured Business Loan | 1,656 | 218 |
| Total | 15,812 | 20,153 |
* Portfolio assigned during FY2025-26 as part of your Companys transition towards a predominantly secured lending book.
Gold loans remained the primary growth engine, with AUM increasing to ^10,352 Crore. The doorstep gold loan business continued to gain traction, with AUM growing 108% YoY to ^1,730 Crore, enabling deeper penetration into underserved rural and semi-urban markets.
Asset Quality and Capital Management
Fedfina continued to strengthen its risk management framework during FY 2025-26 through a conscious shift towards secured lending, enhanced collection capabilities and technology- enabled monitoring.
Asset Quality Parameters
| Particulars | FY 2025-26 |
| Gross NPA (%) | 1.90 |
| Gold Loan GNPA (%) | 0.20 |
| Credit Cost (%) | 0.80 |
| CRAR(%) | 22.40 |
Your Company exited unsecured lending by assigning its ^886 Crore business loan portfolio and further strengthened collections through expansion of in-house collection teams and deployment of machine learning-based early warning systems. Gross NPA improved to 1.9%, while Gold Loan GNPA remained contained at 0.2%.
Financial Performance
FY 2025-26 was a year of strong financial outcomes, supported by growth in secured lending, improved operating efficiency and prudent capital management.
Profitability (Rs. Crore)
| Particulars | FY 2024-25 | FY 2025-26 |
| Net Interest Income | 1,070.8 | 1229.7 |
| Total Income | 1,226.0 | 1347.3 |
| Operating Profit | 520.1 | 576.3 |
| Profit Before Tax | 303.8 | 461 |
| Profit After Tax | 225.2 | 343.6 |
Profit After Tax increased by 52.6% YoY to ^343.6 Crore. Your Company also reported improvement in operating efficiency, with Opex-to-ATA declining to 5.5% despite significant branch expansion during the year.
Financial Parameters
| Particulars | FY 2024-25 | FY 2025-26 |
| Net Worth (^ Crore) | 2,547 | 2,926 |
| Total Assets (^ Crore) | 13,250 | 16,875 |
| Gross NPA (%) | 2.0 | 1.9 |
| Net NPA (%) | 1.2 | 1.3 |
| Opex / ATA (%) | 5.7 | 5.5 |
Fedfina continued to optimise capital utilisation through colending and direct assignment transactions. During FY 202526, your Company executed ^2,580 Crore of direct assignment transactions and onboarded three new co-lending partners, strengthening capital efficiency and funding flexibility.
Technology, ESG and Operational Excellence
Technology and sustainability continued to remain key pillars of Fedfinas growth strategy.
| Key Operational Metrics | FY 2025-26 |
| Digital Registrations | 86%+ |
| ENACH Adoption | 90% |
| Scope 2 Emissions | 5,938 MT CO2e |
| Reduction in Paper Waste | 84% |
Your Company continued to drive digitalisation through Aadhaar OTP verification, PAN OCR integration, CKYC integration, automated reconciliations and robotic process automation initiatives. Sustainability efforts resulted in an 84% reduction in paper waste and lower Scope 2 emissions, reflecting your Companys commitment to responsible growth. Your Company also strengthened its technology and security framework through ISO 27001:2022 certification and implementation of enhanced information security controls.
Credit Rating
Fedfina continues to enjoy strong credit ratings of AA+/Stable from CARE, CRISIL, ICRA and India Ratings. These ratings reflect your Companys strong financial profile, prudent risk management practices and the strength of Federal Banks parentage, providing a robust foundation for future borrowing and sustainable growth.
People Focus
Your Company continued to strengthen its people capabilities through expansion of specialised business, collections and operations teams. Investments in talent development, performance management and employee engagement continue to support Fedfinas growth ambitions and customer-centric operating model.
Ageas Federal Life Insurance Company Limited
Ageas Federal Life Insurance Company Limited (AFLIC), the life insurance joint venture of Your Bank, continued to strengthen its position through sustained business growth, customer-centric innovation and operational excellence. Your Company remained focused on expanding its distribution footprint, enhancing customer experience and delivering sustainable profitability while creating long-term value for stakeholders.
FY 2025-26 marked another year of strong performance for AFLIC, supported by robust new business growth, expanding customer reach, digital innovation and a strengthened bancassurance partnership with Your Bank.
The Focus
• Protection and savings solutions
• Customer-centric insurance offerings
• Distribution expansion
• Digital transformation
• Claims excellence
• Sustainable and profitable growth
With an average retail claims turnaround time of 5 days, AFLIC continued to strengthen its customer-centric claims servicing framework through digital innovation and streamlined processes.
Technology and Digital Transformation
Technology continued to be a key enabler of growth, operational efficiency and customer experience enhancement.
Key initiatives undertaken during the year included:
• Modernisation of core insurance platforms
• Expansion of the ACE ecosystem
• Enhancement of the Customer App
• Improved onboarding platforms for partners and agents
• Digital claims servicing capabilities
• Real-time customer engagement solutions Digital Engagement
159,890
WhatsApp Platform Users
The enhanced WhatsApp platform witnessed strong customer adoption during the year, supported by improvements in user experience, streamlined navigation and expanded service capabilities.
Strategic Partnership with Federal Bank
The Banks approved acquisition of an additional 4% equity stake in AFLIC reflects its long-term confidence in the life insurance sector and reinforces its commitment to strengthening the partnership.
Bancassurance Highlights
| Particulars | FY 2025-26 |
| Additional Stake Acquired 4% Fee Income Growth Contribution 45% |
During FY 2025-26, AFLICs products continued to be distributed through the Banks branch and relationship management network, supported by targeted campaigns and cross-selling initiatives. The partnership contributed significantly to fee income growth while enhancing customer penetration and customer value.
Customer-Centric Excellence
AFLIC continued to strengthen its customer-first culture through its Net Promoter Score (NPS) programme and Voice of the Customer (VoC) framework. These initiatives contributed to improvements in customer experience and service delivery.
In recognition of its customer-centric approach, AFLIC secured the 9th position among Indias private life insurers in the Hansa Research CUES 2026 report, reflecting its continued commitment towards delivering superior customer experiences and building long-term customer trust.
Your Bank remains confident in the long-term growth potential of the Indian economy and the opportunities emerging from increasing formalisation, digital adoption, rising financialisation of savings and expanding credit demand across customer segments. Building on the progress achieved during FY 2025-26, Your Bank will continue to pursue its Federal 4.0 transformation agenda with a focus on delivering sustainable growth, enhancing profitability and creating long-term stakeholder value.
The strategic roadmap for the coming years is centred on strengthening the liability franchise, deepening customer relationships and improving portfolio quality through a calibrated asset mix. Your Bank will continue to focus on growing granular deposits, expanding current account acquisition, enhancing fee- based income streams and increasing its presence in higher- yielding and risk-calibrated lending segments. At the same time, the Bank will maintain its disciplined approach to risk management and capital allocation, while preserving the strong asset quality and capital position that underpin its franchise.
Transformation priorities will continue to focus on improving productivity, simplifying processes and enhancing customer experience through technology and data-led decision-making. Initiatives under the Free The Branch operating model, combined with investments in digital capabilities, analytics, artificial intelligence and operational excellence, are expected to further strengthen business efficiency and scalability. Your Bank will also continue to expand its wealth management capabilities, reinforce its leadership position in NRI banking and leverage emerging opportunities across retail, MSME and commercial banking segments.
Supported by a strong balance sheet, a diversified business model and a clear strategic direction, Your Bank remains well positioned to navigate a dynamic operating environment and deliver consistent, sustainable and profitable growth over the medium to long term.
Internal Control, Compliance and Governance Framework
Internal Audit
Internal Audit conducts independent evaluations to ensure that your Banks internal controls, risk management and governance systems are adequate, complete, efficient and effective. The Boards Audit Committee guides and reviews the internal audit function, including its reporting structure, personnel, scope and audit frequency. The Head of Internal Audit is appointed as the "Chief Internal Auditor" and reports directly to the Managing Director & CEO. There is also an executive committee called the "Internal Audit Review Committee of Executives," led by the Managing Director & CEO, which supervises internal audit activities, examines audit procedures and methods, tracks audit progress, assesses branch risk ratings and reviews key audit findings.
The Internal Audit Policy, Information System Audit Policy & Guidance Manual and the Internal Audit Procedure & Guidance Manual serve as the primary reference documents for the Internal
Audit function and are reviewed annually. This review incorporates necessary updates and refinements based on observations from the Reserve Bank of India during Risk-Based Supervision, compliance with other regulatory requirements, amendments to internal rules and guidelines and directives from the Audit Committee of the Board as well as the Board of Directors. Such periodic evaluations and modifications ensure that audit systems and procedures remain current and continue to serve as effective tools for monitoring control and compliance within the Bank. The Internal Audit department is also responsible for the ongoing self-assessment of the Banks internal financial controls through regular testing and validation of control effectiveness.
During FY 2025-26, the Department maintained its transition toward a risk-based, data-driven and technology-enabled audit methodology, placing greater emphasis on root-cause analysis, comprehensive cross-functional impact assessments and sustainable corrective actions. The approach evolved from checklist-oriented and transaction-level reviews to thematic, risk-focused and system-led audits.
All activities—including outsourced operations—and all entities, including subsidiary companies, of your Bank are encompassed within the scope of internal audit. Audits were conducted across various operational units in accordance with the audit universe and the Annual Audit Plan approved by the Audit Committee of the Board.
The major audits undertaken by your Bank during the financial year are:
Risk-Based Internal Audit- Your Bank has leveraged Risk-Based Internal Audit (RBIA) as a tool to assess the risks in its processes, operations and the effectiveness of related controls. Risk-Based Internal Audit focuses on prioritising audits and audit resources based on composite risk rating derived from the level of inherent business risks and control risks. The RBIA Framework is subject to annual review and is extended to branches and centralised functions and departments.
Information System Audit- Information System Audit collects and evaluates the evidence to determine whether the information system safeguards assets, maintains data integrity and availability, achieves organisational goals effectively and consumes resources efficiently. It focuses on the risks that are relevant to information assets and assesses the adequacy of controls implemented for mitigating the risks. All critical IT infrastructures in your Bank are subjected to Information System Audit by information systems professionals from reputed CERT-IN empanelled external audit firms and Certified Information System Auditors (CISA) of your Bank. During FY 2025-26, your Bank strengthened in-house Information System Audit capabilities. The Department enhanced its internal expertise through onboarding of specialised resources and certifications in areas such as CISA, CISM, CRISC and other information security domains. Critical Information Systems are subjected to Vulnerability Assessment & Penetration Testing (VAPT) every half year. In addition to this, Information System Audit covers the physical security of IT systems and business continuity procedures followed by Bank.
Management Audit- Management Audit is conducted for noncritical departments and offices, with focus on identifying the adequacy and effectiveness of processes adopted for decisionmaking, governance, control and compliance. The feedback from management audit is relied upon by the auditee units to improve the processes, procedures and systems in place in such offices.
Offsite and Revenue Audit - Offsite audit is a forward-looking diagnostic tool to identify gaps in the systems and procedures of your Bank. The entire revenue audit in your Bank is undertaken through Offsite Audit. Your Bank leverages Computer Aided Audit Tools (CAAT) for generating and analysing exceptions while conducting offsite audits.
During the year, IAD adopted a comprehensive revenue assurance framework aimed at identifying, quantifying and preventing revenue leakages through data-driven audits and systemic interventions. The Department also increased the use of data analytics, SQL-based data extraction and automated data flows for audit scoping, sampling and exception identification
Concurrent Audit - Your Bank is increasingly relying on Concurrent Audit as an early warning system to ensure near real-time detection of irregularities and lapses and as a tool to prevent fraud. Concurrent Audit coverage includes all high risk rated branches, all centralised processing centres, critical departments of the bank like Treasury, Operations, Transaction Monitoring and Fraud Prevention Department, AML Monitoring Department etc and other select branches and offices to ensure minimum coverage as stipulated in Audit policy. During the year under review, Concurrent Audit was in place in 306 branches and 110 offices, covering 69.54% of total advances and 38.84% of total deposits of your Bank. Concurrent Audit is also conducted in all the currency chests as required by the Reserve Bank of India. 292 External Auditors / Audit Firms, 7 Retired Officers and 18 internal audit staff were engaged for concurrent audit assignments during the period.
Thematic Audit- Thematic audits of activities, systems, applications, processes and products are conducted centrally. These audits focus on specific themes across schemes, sectors, functions, or units within the organisation to assess the degree of compliance with internal policies and statutory/regulatory requirements. During FY 2025-26, increased emphasis was placed on thematic and special audits to identify emerging risk patterns and uncover systemic issues.
Third Party / Outsourced Agency Audit- A comprehensive risk-based audit of partners, service providers and outsourced agencies is conducted to assess financial stability, regulatory compliance, operational resilience and adequacy of information security controls. Periodic reviews are also conducted on such units to safeguard the interests of all stakeholders of your Bank.
During FY 2025-26, the Internal Audit Department took many initiatives under the CODES framework — Centralise, Optimise, Digitise, Eliminate and Simplify. The objective of CODES is to move audits away from location-dependent, manual and fragmented processes towards a centralised, technology-driven and risk-focused operating model. A new Audit Management
Solution is rolled out and audit observations under all types of audits is tracked in AMS along with automation of risk rating and risk-based sampling.
The Internal Audit Department is manned by appropriately qualified personnel with expertise and exposure in various activities of your Bank, such as branch operations, credit sanction, credit monitoring, operations, information technology, risk management, treasury operations, forensic audit, vendor audit and data analytics.
Capacity building remained a key focus area during FY 202526. The Department had 119 auditors holding 277 specialised certifications spanning information systems, credit, risk and allied domains, while 20 officers pursued advanced qualifications in cyber security, CISA/CISM/CRISC forensics and fraud detection.
During the FY 2025-26, audits were undertaken at various operating units, considering the audit universe and in tandem with the Annual Audit Plan approved by the Audit Committee of the Board. Data on major audits conducted during the year is as follows:
| Type of inspection/Audit | Number of Audits |
| Risk-Based Internal Audit of branches | 1281 |
| Risk-Based Internal Audit /Management Audit of Departments/Offices including IFSC Banking unit | 151 |
| Revenue Audit | 1551 |
| Gold Loan Audit | 1833 |
| Credit Audit | 2760 |
| Annual Audit of currency Chests | 10 |
| Due Diligence/Vendor Audits of Outsourced agencies/ Managed Services | 331 |
| Audits of Federal Ashwas Financial Literacy Centres | 22 |
| Offsite audits | 150 |
| Thematic & Special audits | 69 |
Transaction Monitoring & Fraud Prevention
Your Bank has implemented several comprehensive measures to ensure the highest standards of monitoring and fraud prevention across all our transaction channels. Transaction Monitoring & Fraud Prevention Department operates round the clock, equipped with state-of-the-art monitoring tools to proactively manage risks. All transactions through our Core Banking System (CBS), as well as digital platforms like FedNet, FedMobile and FedCorp, are closely monitored in real time by our dedicated team. Further debit card, credit card and UPI transactions are also monitored diligently in real-time. We utilize advanced Fraud Risk Management applications, which generate alerts instantly, allowing us to respond promptly to any suspicious activity. We have further reinforced our surveillance capabilities by developing internal AI/ML monitoring models that are specifically tailored to our unique risk landscape. These models have been seamlessly integrated with the banks Fraud Risk Management (FRM) systems, significantly enhancing our ability to monitor and respond to potential risks. This integration allows us to leverage
cutting-edge technology for early detection and prevention of emerging fraud patterns, ensuring that our monitoring remains proactive and intelligence driven.
To enhance the detection and monitoring of mule accounts, we have adopted a model-based approach called "MuleHunter. ai," in coordination with RBI Innovation Hub. Additionally, our bank leverages a web crawling service to identify suspicious accounts on various websites. Our monitoring capabilities have been further strengthened by integrating data from I4Cs suspect registry, as well as the MNRL and FRI lists provided by the Department of Telecommunication.
All these initiatives work together to empower our Bank to detect and prevent emerging fraud patterns with a proactive and intelligence-driven strategy. We are proud to share that our efforts were recognized with the BFSI Team for Excellence in Fraud Risk Management award at the FinCrimeExpert Conclave & Awards 2025.
Regulatory Compliance
The Compliance function operates as an independent second line of defence, led by the Chief Compliance Officer with direct reporting to the Board, Audit Committee of the Board and MD & CEO, ensuring autonomy, effective oversight and transparent escalation of compliance risks.
The Department over the years have transformed into a competent, professional function, with in-depth relation with key regulators, pan India market visibility establishing a benchmark model among industry peers. The function has developed a competent all-encompassing Enterprise-Wide Compliance Risk Management Framework (ECRMF) to manage all the compliance related risks for early detection and resolution.
During the year, the Compliance function focused on strengthening proactive monitoring, regulatory accessibility and compliance culture across the Bank.
A SaS-powered continuous monitoring framework, enabling near real-time identification of high-risk transactions and control deviations was implemented. This has enhanced early detection, risk prioritization and timely remediation, reducing reliance on periodic manual reviews.
An enterprise-wide ChatBot as a centralized repository of regulatory guidelines was launched. This has improved speed of access, consistency in interpretation and self-service compliance enablement across business units.
A structured role-based training programs involving 59000 manhours to strengthen regulatory awareness and ownership at the first line level was conducted. These initiatives have contributed to a stronger compliance culture and reduction in repeat deviations.
We have strengthened documentation standards, audit trails and regulatory mapping, improving audit preparedness and effectiveness in closure of regulatory and audit observations.
Going forward, the Bank will:
• Expand continuous monitoring capabilities with wider coverage and advanced analytics
• Enhance AI-driven regulatory tools and knowledge platforms
• Deepen compliance culture and first-line accountability
• Strengthen data governance and supervisory reporting frameworks
The year marked a transition towards technology-led, proactive compliance, positioning the Bank to effectively manage increasing regulatory expectations while supporting sustainable growth.
Legal Compliance
During FY 2025-26, the legal and regulatory environment for the banking sector continued to evolve rapidly, driven by digital transformation, enhanced regulatory oversight and new legislative developments. The Legal Department remained proactive in ensuring compliance while supporting the Banks strategic and business objectives through timely legal advisory and support.
A key focus area was the Banks preparedness for compliance with the Digital Personal Data Protection (DPDP) Act, 2023 and its Rules. The Department provided extensive support in drafting and reviewing agreements and related documentation to incorporate data protection and privacy obligations and continues to work closely with stakeholders to ensure readiness for full regulatory implementation.
The Department also explored the adoption of Artificial Intelligence (AI) tools to enhance efficiency in legal operations. Initial trials demonstrated value in areas such as drafting support, document structuring and research. However, risks relating to accuracy, reliability, confidentiality and limited contextual understanding were identified. Accordingly, AI tools are currently treated as supplementary aids, with continued reliance on professional legal judgment and human oversight. With appropriate safeguards and governance, AI is expected to offer long-term operational benefits.
Additionally, the Legal Department played a critical role in supporting the launch of new business segments by drafting and
vetting key legal documents, ensuring alignment with contractual and regulatory requirements.
The Department remains committed to strengthening its capabilities, responsibly adopting technology and delivering practical, risk-aware legal guidance in alignment with evolving regulatory expectations and the Banks growth initiatives.
Due Diligence of MFI/BC Partners
From a legal standpoint, the Agreements with MFI partners incorporate adequate and comprehensive contractual safeguards.
The clauses, inter alia, provide that MFI partners shall be responsible for compliance with all laws, rules, regulations and ordinances applicable in respect of their agents, including but not limited to Minimum Wages Act, Provident Fund laws, Workmens Compensation Act, Gratuity, Bonus Act, Workmens Compensation Act, Contract Labour (Regulation & Abolition) Act, etc., or under any other State/Union legislation. They shall establish and maintain all proper records, including, but not limited to, accounting records required by any law or regulatory guideline applicable from time to time, including records and returns as applicable under labour legislations.
Additionally, the Agreement incorporates human rights-aligned provisions, whereby the partner acknowledges the Banks commitment to integrating human rights considerations into its business activities and, in pursuance thereof, covenants and agrees to support and respect international norms on human rights, including, without limitation, the International Bill of Human Rights, the Guiding Principles on Business and Human Rights, the ILO International Labour Standards and the Childrens Rights and Business Principles. The partner further agrees to advance its business operations in accordance with these principles and confirms that it does not tolerate any violation of human rights, including, without limitation, forced labour and child labour.
The Agreement also contains due diligence and oversight provisions, entitling the Bank to conduct reasonable due diligence reviews of the BC and its operations. The BC is contractually obligated to extend full cooperation and provide all requisite information, documents and clarifications in a timely and accurate manner to facilitate such assessments.
Human Rights and Labour Standards in Supplier Contracts
The Agreements contain specific ESG clauses whereby vendors acknowledge that the Bank is committed to integrating human rights considerations into its business and agree that they shall: •
• Support and respect international norms on human rights, including, without limitation, the International Bill of Human Rights, the Guiding Principles on Business and Human Rights, the ILO International Labour Standards and the Childrens Rights and Business Principles, and advance their business operations in accordance with them.
• Not tolerate any violation of human rights, including, without limitation, forced labour and child labour.
• Nurture a corporate culture of respect for human rights by ensuring that their employees are mindful of the prohibition of discrimination on the basis of race, nationality, age, gender, sexual orientation, gender identity, religion, beliefs, physical characteristics, disability, career and so forth, as well as the prevention of various types of harassment, and create respect for national and regional cultures and customs.
• Adhere to practices of workplace equality and nondiscrimination and train employees on their rights, parental leave and provide transparent remuneration as per industry standards.
• Make continuous and appropriate efforts to encourage stakeholders to fully appreciate and agree with the policies and initiatives regarding respect for human rights.
• Comply with applicable labour laws and regulations and seek to maximise respect for the human rights of their employees.
• Comply with the provisions of the Prevention of Sexual Harassment Act or any other applicable law in this regard, ensuring a proper work environment where no employee is subjected to professional or personal harassment.
• Have a suitable grievance redressal mechanism in place that enables employees to consult and report unfair treatment, unprofessional conduct, bias, workplace harassment, intimidation, threatening behaviour, policies and processes, or any act in contravention of diversity and inclusion or any case of breach of human rights.
• Provide training to their employees on various human rights issues on a continuous basis.
In addition, the Bank has in place a comprehensive Supplier Code of Conduct, which provides that the Bank expects its suppliers to uphold the highest standards of human and labour rights and integrate these principles within their operations and value chains. Suppliers shall comply with all applicable laws and regulations relating to labour practices, health and safety, and non-discrimination in India and in all jurisdictions in which they operate, and shall refrain from engaging in any activity inconsistent with applicable labour standards.
Anti-Money Laundering
The Bank continues to demonstrate a strong commitment to maintaining robust Anti-Money Laundering (AML) and Counter Financing of Terrorism (CFT) controls. The AML Monitoring Department plays a critical role in safeguarding the institution against financial crime risks through strengthened frameworks, enhanced surveillance mechanisms and strict adherence to regulatory expectations issued by RBI and FIU-India.
During FY 2025-26, the Bank significantly advanced its AML capabilities through strategic initiatives in analytics, industry collaboration and capacity building, thereby improving its ability to detect, prevent and respond to emerging financial crime risks.
Key Activities and Achievements in FY 2025-26 Awards and Accolades
The Chief Compliance Officer of the bank has received the Lifetime Achievement Award in Financial Crime Compliance for the commendable achievements made in the strengthening the compliance framework of your bank and for playing key role in framing policies and processes to mitigate risks against Laundering, Sanctions and Bribery.
Outstanding Achievements
For the first time your Bank has become the part of the Operational Analyses and Presentation in the FPAC (FIU-India Initiative for Partnership in AML/CFT) in the presence of FIU- India, RBI, I4C and other senior finance ministry officials for the commendable intelligence sharing done during the period.
Industry Collaboration and Regulatory Engagements
Your Bank is part of various working groups constituted by ARIFAC (the Alliance of Reporting Entities in India for AML/CFT) and FIU-India. The working groups includes Sanctions Screening and Watchlist Filtering, Digital Banking and Mule Account Risk Assessment and Banks and Payment Aggregators on Mule Account Identification and RFIs. These engagements will enable alignment with evolving regulatory expectations, industry-wide knowledge sharing, contribution to practical and implementation- oriented governance decisions.
System Enhancements and Data Analytics
Your Bank has implemented MuleHunter.ai in partnership with RBI Innovation Hub (RBIH) w.e.f 18 August 2025 for advanced analytics-driven identification of mule accounts. It was among the early adopters (first six banks) to onboard this solution, reflecting strong technological leadership in financial crime detection. The key outcome of this project includes early detection of suspicious mule accounts exhibiting fraudulent characteristics through hourly scoring and near real time alert generation, thereby leading to timely actions of such accounts.
Training Programs and Awareness Sessions
Your bank has undertaken capacity-building initiatives which is inclusive of quarterly AML/compliance awareness sessions imparted to high-risk branches, leading to measurable improvement in the Banks position in the Indian Cyber Crime Coordination Centre database. Focused training initiatives resulted in enhanced frontline detection of suspicious activity and improved compliance culture across business units
Future Plans
In the upcoming year, the AML Monitoring Department plans to further enhance its operations by incorporating artificial intelligence tools, increasing data analytics capabilities and improving customer risk scoring models. This initiative involves the development of an integrated workflow that supports an agentic (AI-enabled with human oversight) operating model. Key components of the exercise will include threshold optimization and enhanced customer segmentation, aimed at strengthening proactive risk identification capabilities while effectively reducing false positives.
Additionally, there will be a focus on aligning with forthcoming regulatory changes and strengthening the monitoring of crossborder transactions. Your Banks achievements in implementing effective AML measures and contributing to the broader industry landscape validates its hard work and dedication and also inspires the organisation to continue pushing boundaries of AML excellence.
Vigilance
Industry structure and key developments in the industry:
The banking industry continues to operate in a rapidly evolving risk landscape shaped by accelerated digital adoption, expansion of electronic payment channels and increasing sophistication of cyber and financial frauds. Fraud typologies such as social engineering, impersonation and digital coercion have become more prevalent, exposing customers—particularly senior citizens and first-time digital users—to heightened risk. This has led to greater regulatory and supervisory emphasis on early warning systems, proactive fraud prevention and customer protection. While digitisation has deepened financial inclusion and operational efficiency, it has simultaneously expanded the threat landscape, necessitating stronger fraud risk management and preventive vigilance frameworks.
Banks are increasingly moving from reactive fraud detection to technology-enabled, analytics-driven monitoring frameworks, supported by structured surveillance, behavioural analysis and cross-functional coordination. At the same time, regulators and law-enforcement agencies have been actively collaborating with banks to enhance public awareness and resilience against cyber frauds. Regulators have enhanced supervisory expectations around early identification of fraud, red flagging of accounts, time-bound fraud classification and accountability frameworks, particularly in respect of large borrower accounts and digital frauds.
Against this backdrop, industry-wide focus has expanded beyond internal controls to include large-scale customer awareness initiatives, staff capacity building, whistle-blower mechanisms and strong governance oversight through Board-level and senior management reviews. Preventive vigilance, ethics and transparency have emerged as key enablers of trust and sustainable growth in the banking system.
Recap on the year gone by with major highlights/ achievements and breakthroughs achieved:
During FY 2025-26, Banks fraud risk management was strengthened through a proactive, technology-driven and risk-based approach focused on early identification, effective investigation and timely mitigation of emerging risks. Continuous monitoring of account behaviour using financial and non-financial indicators enabled early detection of vulnerabilities across business segments. Investigations were conducted through a structured and time-bound process, ensuring root-cause analysis and implementation of corrective and preventive measures. Learnings from past incidents were systematically disseminated across the organisation to strengthen controls and prevent recurrence.
Preventive vigilance remained a key focus area. Surveillance mechanisms combining system-driven monitoring, analytical oversight and targeted reviews of high-risk portfolios were leveraged to enhance fraud prevention. Preventive Vigilance Assessments (PVAs) were conducted in identified vulnerable branches to address control gaps. During the year, approximately 40 preventive vigilance workshops and 54 training sessions were conducted, covering over 2,500 employees across roles and scales, including specialised cyber fraud and social engineering awareness sessions. Public awareness initiatives were significantly expanded through the nationwide "Twice is Wise" cyber fraud awareness campaign, conducted in association with law-enforcement agencies and media partners, reaching over 10 Crore people across multiple states and channels. The Bank also undertook targeted awareness initiatives on emerging frauds such as "Digital Arrest" scams, particularly for senior citizens.
The Whistle Blower mechanism under the Protected Disclosure Scheme (PDS) continued to function effectively, with complaints examined in accordance with policy and reviewed periodically by the Audit Committee. Several instances of proactive intervention by branch staff during the year successfully prevented cyber frauds, reinforcing customer trust and the Banks vigilance culture.
Vigilance Guidance and Reporting Mechanisms
The Vigilance function provides advisory guidance through periodic circulars, preventive vigilance workshops, training programmes and awareness sessions, equipping employees with knowledge on emerging fraud risks, ethical standards and implementation of control measures. Employees are advised through these communications to seek guidance and report concerns through established channels, including the whistleblower mechanism, thereby facilitating timely reporting of unethical practices and adherence to responsible business conduct.
The Bank has established structured mechanisms for employees and stakeholders to raise concerns regarding the organisations business conduct through the Protected Disclosure Scheme, a comprehensive whistleblower mechanism. The mechanism provides for responsible and secure reporting by all stakeholders and is aligned with applicable regulatory guidelines of RBI and provisions of Companies Act 2013.
The framework provides designated channels for reporting concerns, ensuring confidentiality, protection of identity and safeguards against retaliation. The Vigilance Department functions as the nodal authority for examining such complaints through a structured and transparent process, covering timely investigation, appropriate escalation and corrective action wherever required. Awareness and accessibility of these mechanisms are promoted through periodic vigilance awareness programmes, training sessions, e-learning modules, circulars and disclosures on the Banks intranet and website.
Way forward/ outlook and opportunities for the future:
The fraud risk environment is expected to become increasingly complex, driven by rapid digitalisation, evolving cyber-enablec fraud typologies and greater reliance on remote and technology-led banking channels. Traditional rule-based and reactive approaches are increasingly inadequate to address the scale, speed and sophistication of emerging fraud risks. In this context, the Banks Vigilance and Fraud Risk Management function will continue to focus on future-proofing its framework through technology-enabled, intelligence-led preventive vigilance mechanisms, moving further upstream from detection to prevention.
The Bank will strengthen the use of advanced analytics, artificia intelligence and system-driven surveillance to identify anomalous patterns, behavioural risks and emerging fraud trends at an early stage. Enhanced integration of early warning indicators across credit and non-credit portfolios will support timely intervention and mitigation. Insights from investigations and global best practices will be leveraged to continuously refine controls processes and governance frameworks.
Preventive vigilance will continue to remain a core priority through expanded employee training, targeted thematic reviews and deeper engagement with frontline staff to address emerging risks at an early stage. The Bank will also sustain its focus on large-scale customer awareness initiatives, in close collaboration with regulators and law-enforcement agencies, to build resilience against cyber and financial frauds. By leveraging preventive vigilance, employee sensitisation and customer outreach as key risk-mitigation levers, the Vigilance function seeks to reduce fraud risk at the source. This balanced and integrated approach— combining people, processes and technology—aims to strengthen institutional resilience, safeguard customer interests and supporl sustainable growth in an increasingly digital banking environment
g Strategic Planning
^ The Corporate Planning Department plays a central role in t shaping the Banks long-term vision, guiding the organization
s along its strategic trajectory while upholding the principles
y embodied in CARES. By continuously monitoring the financial, , economic and regulatory landscape and undertaking periodic e peer benchmarking exercises, the Department ensures that the
s Bank remains Alert, Agile and Astute in its pursuit of excellence.
Insights derived from these structured analytical exercises are leveraged to inform and shape the Banks medium- to long-term strategy. In addition to strategy formulation, the Department ensures its effective implementation by establishing clear goals, y targets and budgets, providing relevant management information
^ for performance evaluation and facilitating continuous monitoring
^ and tracking of the strategic objectives. d
s For FY 2025-26, your Bank made significant progress across its
i 12 breakthrough themes which were - 1. NIM Improvement, 2.
t Expanding Product Portfolio, 3. Fee Enhancement; 4. Branch
< Strategy for Scalable Growth, 5. Branch Transformation, 6. Brand
5 Transformation, 7. Digital at the Fore, Human at the Core, 8.
i Renewed Digital Distribution Strategy, 9. People & Culture, 10.
Cost Optimization, 11. Strengthening Assurance Functions and
12. Journey towards a Universal Bank. In line with its strategy !l of expanding its footprint to support scalable growth, the Bank
s opened 51 new outlets across select geographies during FY 2025-
y 26. As of March 31, 2026, the Banks network comprised 1,640
s banking outlets and 2,112 ATMs/Cash Recyclers. The Bank also
1 achieved new milestones in business growth and profitability,
t surpassing ^1 Lakh Crore in CASA for the first time, recording its
^ highest-ever fee income of ^3,559 Crore, while maintaining asset quality at its best level in over a decade.
Cautionary Statement
g The Management Discussion and Analysis Report contain forward looking statements that reflect the current views, expectations and assumptions of the management of Your Bank regarding future events and business performance. These statements are e subject to various risks and uncertainties, including changes in economic conditions, interest rates, regulatory developments, market dynamics, competitive factors and other developments affecting the banking and financial services industry, which may cause actual results to differ materially from those expressed or implied. The financial and operational information presented herein is based on information available as of the date of this
Report and while believed to be reliable, may be subject to change. Your Bank undertakes no obligation to publicly update or revise any forward-looking statements except as required by applicable laws and regulations.
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