Near-to-medium-term outlook on growth, asset quality and earnings remains Stable

• Asset quality to remain comfortable despite uptick in slippages: Slippages were witnessed on an uptick with an annualised fresh NPA generation rate of 1.38% in Q1 FY2026 from 1.31% in Q4 FY2025 and 1.34% in Q1 FY2025 on account of stress in the unsecured segment. Though in comparison to FY2024 (1.50%), the fresh NPA generation rate had trended lower in FY2025 (1.33%).
• Pace of credit expansion to remain healthy in FY2026: Credit growth was reported at 11.4% in FY2025 and 9.3% (YoY) in Q1 FY2026 after the highest ever credit expansion in the banking industry of Rs. 22.3 trillion (16.3% YoY) in FY2024. While the pace of incremental bank credit growth in the current year was tepid in the beginning, it picked up pace by the end of Q2 FY2026.