ESAF Small Finance Bank demonstrated robust deposit mobilisation in Q4FY26, with total deposits increasing 11.05% year-on-year to ₹25,850 crore as of March 31, 2026. According to reports from The Hindu BusinessLine and HomeStocksNews, this growth reflects continued customer accretion and improved deposit mobilisation across various segments. The bank's CASA deposits grew at a relatively moderate pace of 6.88% year-on-year, reaching ₹6,181 crore, though the CASA ratio declined to 23.91% compared to 24.84% in the year-ago period, indicating relatively faster growth in term deposits during the quarter.
The bank's advances portfolio showed strong momentum, rising 19.42% year-on-year to ₹22,426 crore as of March 31, 2026. As reported by The Hindu BusinessLine and HomeStocksNews, this growth was driven by a sharp 37.88% increase in secured lending to ₹13,680 crore. The share of secured advances improved significantly to 61% from 52.84% a year ago, reflecting a strategic shift towards lower-risk assets. The bank also undertook NPA sales worth ₹1,019 crore during the year, without which loan growth would have been higher at 24.85%.
Disbursements demonstrated exceptional growth, more than doubling to surge 103% year-on-year to ₹42,529 crore in FY26. According to The Hindu BusinessLine and HomeStocksNews, the credit-deposit ratio rose to 86.75% from 80.68%, indicating improved asset utilisation. The bank's customer base expanded significantly, with addition of 8.01 lakh new customers, bringing the total customer base to 1.02 crore. The distribution network stood at 804 branches, 720 ATMs and 1,049 customer service centres across 24 states and 2 union territories.
The bank's strategic focus on secured lending reflects a deliberate shift towards lower-risk assets, with the 37.88% increase in secured advances reaching ₹13,680 crore demonstrating this commitment. As reported by HomeStocksNews, this expansion in deposits and advances signals robust business growth, enhancing the bank's ability to attract funds and deploy them through lending, a primary driver of profitability. The growing customer base and branch network point to improved market penetration, vital for a small finance bank aiming for financial inclusion, while the increased focus on secured lending could help de-risk the loan portfolio.
Looking ahead, investors will closely monitor several factors including trends in Gross and Net NPAs, the bank's ability to achieve sustained profitability after recent losses, and the growth and proportion of low-cost CASA deposits. As reported by HomeStocksNews, asset quality remains a key concern given the bank's historical high NPAs and recent losses, while the slower growth in CASA deposits compared to overall advances needs monitoring for its impact on funding costs. The bank faces competitive pressures from established players like AU Small Finance Bank, Equitas Small Finance Bank, and Ujjivan Small Finance Bank, with AU SFB notably pursuing a universal bank license.
