Capital Small Finance Bank Ltd (NSE: CAPITALSFB) Q1 2026 Earnings Call dated Jul. 25, 2025
Corporate Participants:
Unidentified Speaker
Sarvjit Samra
Munish Jain — Director
Aseem Mahajan — CFO
Raghav Aggarwal — Chief Risk Officer
Sahil Vijay — Head for Treasury and Investor Relations
Bharti Babutta — IR Advisers, SGA
Analysts:
Unidentified Participant
Rehan Saiyyed — Analyst
Sugandhi — Analyst
Shubham Silvadia — Analyst
Sonal Minhas — Analyst
Nirvana Laha — Analyst
Anant Mundra — Analyst
Divyansh Gupta — Analyst
Pritesh — Analyst
Ashish Shah — Analyst
Shahzad Shroff — Analyst
Shubham Selvadia — Analyst
Sarvjit Samra — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Capital Small Finance Bank Limited Q1FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sarvjit Samra from Capital Small Finance Bank. Thank you. And over to you, Mr. Samra.
Sarvjit Samra
Thank you. Hamsha. Good afternoon everyone. I am Sarabjit Samra, Managing Director and CEO of Capital Small Finance Bank. Welcome to Capital Small Finance Bank’s earning call for the quarter ended June 2025. Thank you all for joining the call. You probably would have seen the financial results and the investor presentation that we have uploaded on the stock exchanges. Joining me today are Mr. Munish Jain, our executive director, Aseem Ahajan, CFO Raghav Agarwal, chief Risk Officer, Sahil Vijay, Head for Treasury and Investor Relations, Bharti Babuta from the Investor Relations team and our IER Advisors sga. Let me begin with a quick look at the operating environment.
India’s economic trajectory remains firmly on track with financial year 26 GDP growth estimates at 6.5% reinforcing its position as one of the fastest growing major economies globally. This momentum is underpinned by several favorable macro factors, most notably a steady decline in inflation above normal monsoon outlook and a policy pivot by the Reserve bank of India towards more accommodative stance. Q1 remained seasonally soft marked by subdued macroeconomic conditions and weak underlying demand on ground operating environment remain mixed. However, we witnessed signals of gradual improvement as the quarter progressed, particularly in May and June. On positive notes, the Reserve bank of India’s recent policy rate cuts, liquidity sport measures and the announced ER reduction have provided a flip to deposit mobilization and system liquidity.
During the quarter we witnessed strong momentum. On the deposit front. Our total deposits grew to 9110 crores reflecting 17.1% year on year and 9.5 sequential growth supported by favorable monetary policy queues and sustained customer trust. Our retail focused franchise continue to deliver stable low cost deposit growth with CAFA levels remaining healthy at 35.9%. A testament to our deep rooted presence across semi urban, rural and urban markets. On credit side, our lending book expanded steadily maintaining its cured and diversified nature. Gross Advances stood at 7437 crores up 16.4% year on year and 3.5% quarter on quarter. We continue to stay true to our conservative credit philosophy with nearly the entire book secured and no direct exposure to high risk MFI segments.
Disbursement activity picked up pace during the quarter in line with improving ground level sentiment and our calibrated approach to sectoral lending. Despite a decline declining interest rate environment, we maintained a healthy NIM of 4.1% supported by robust liquidity management and prudent asset deployment. Operating profit grew by 24% supported by a 38% increase in non interest income and improvement in cost efficiency with cost income ratio improving to 60.5% from 62 to 6% in the previous quarter. Profit rose to 32 crores. Profit after tax rose to 32 crores marking a 7% year on year growth. Return on assets stood at 1.2% as of June 30, 2025.
From asset quality perspective it remains stable with gross NPAs at 2.7% as of 6-30-25, unchanged on a year on year basis and marginally higher than 2.6 in Q4 of financial year 25. The net NPs for the quarter ended June 30 at 1.4%. Overall asset quality remains strong as of 6-30-25. Our SMA1 and SMA2 counts calculated as percentage of advances stood at 5.47%, showing a notable improvement from 6.42% a year ago, reflecting better portfolio quality and early delinquency control. The credit cost increased to 0.37 out of which 0.19% attributes to slippage from MBSE MFI School year Bank has less than 1% exposure to NBSE MFI.
It’s worth mentioning that no other nbsp including MFIs is showing any sign of stress. We strongly believe this acceleration in credit cost is temporary for the Q1 financial year 26. Overall asset quality strong and stable. In summary, the first quarter financial year 26 reaffirms the soundness of our strategy built on financial prudence, customer centric electricity and disciplined execution. As we move ahead, we remain optimistic about the emerging economic tailwinds and we are well positioned to harness opportunities in both lending and deposit growth while safeguarding portfolio quality and enhancing shareholder value. Looking ahead, we anticipate a gradual recovery in the broader economic environment during the second half of the fiscal year, driving by improving rural sentiment, a rebound in urban consumption, a pickup in investment activity and government’s continued focus on capital expenditures.
Building on this positive macro trend, I now hand over to Mr. Munish Jain to walk you through our other quarterly performance details.
Munish Jain — Director
Thank you Mr. Sambra and warm welcome. To all of you. Mr. Shamra has shared the financial performance highlights. I’d just like to add few further points. Gross advances of the bank stood at 7437 crore as on June 30, 2025 reflecting YoY growth of 16.4 and Q&Q growth of 3.5. The growth driver for the quarter remained MSME portfolio which grew 25.6% on year on year basis and 9% on quarter on quarter basis followed by a lap within the mortgage which grew by 23.6% year on year basis and 5.4% on quarter on quarter basis. Mortgage book grew by 16% year on year basis and 3.9% on quarter on quarter basis.
The portfolio remained granular with the average ticket size of 16.6 lakhs as on June 30, 2025. The loan book remained well diversified with 99.8% being secured with zero direct MFIE exposure and with exposure to MFI NBSC MFI the bank is having less than 1% as on June 30, 2025. Further 89% plus of the portfolio excluding the corporate loan is secured by immovable property bank ftrs over loan book remain well diversified across various sectors that have demonstrated resilience across multiple credit cycles. As of June 30, 2025, agriculture accounted for 30% of the portfolio compared to 32% in Q4 FY25 mortgage being 27 at both the period end MSME and trading book increased to 22% against 21% in Q4FY25 and corporate loan book has increased to 14% from 13% in Q4FY25.
Fresh disbursement for the quarter ended June 30 stood at 865 crores registering a year on year growth of 15% and sequential growth of 13%. The disbursement mix for the quarter reflect over continued focus on secure segment with 28% of the disbursement towards MSME, 23% towards large corporates, 21% towards mortgage and 20% towards the agriculture segment and the remaining 2 consumption and the other loans. This composition underscores Our commitment to maintain a well diversified any granular lending approach during the quarter deposit continued to be the primary source of the fund and constituting 93.6% of the total outside liability.
As on June 30, 2025, we have a stable cost of deposit and cost of funds that is 5.9% and 6% respectively. The average credit to deposit ratio improved to 80.9% in Q1FY26 compared to 79.6% in Q1FY25 indicating improved deployment of funds and balanced growth in both advances and deposits. To sum up, Q1 FY26 was a quarter of steady and disciplined execution amid the transiting macro environment. We remain confident in our strategic direction over customer centric operating model and our ability to deliver consistent and sustainable performance. Our endeavor will continue to organically grow over secure loan book of growth of 20% plus during the fiscal by targeting MSME and mortgage segment and we also intend to have PROTA expansion during the year.
With this I would like to request the operator to open the floor for question and answers. Thank you so much.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Rehan Syed from Trinetra Asset Managers. Please go ahead.
Rehan Saiyyed
Good afternoon everyone and thank you for giving me the opportunity. Are there any internal targets to expand your branch network beyond the current 195 prices? If you just clarify more of this.
Munish Jain
We are missing your voice. If you can please repeat again, there is some February in the voice. If you can please repeat your voice.
Rehan Saiyyed
So I’m asking are there any internal targets to expand your branch network beyond the current 195 branches this year? If you can just put some light on that.
Sarvjit Samra
Yeah, with regard to branch expansion already the process is going on for the expansion where in this financial year we intend to add 20 to 25 branches and by adding one more state as well. Because presently we are in five states and two union territories. We’ll be spending to one more. We’ll be adding one more state as well to our area of operation.
Rehan Saiyyed
Okay, okay. So my next question is around like are any. Are you exploring any digital landing or co lending partnership with Fintech field especially for MSME or Housing.
Munish Jain
As far as the we’ve always believed that we need to know our customer well before we underwrite. So presently co lending is not an opportunity available for the small finance banks that is not permissible under the regulatory guidelines. Yes, for the other partnership based lending we are flexible depending upon the opportunities for specifically for the lending product which falls in over DNA that is a secured landing product. We are open for a partnership based lending but we are not very aggressively looking forward for any fintech based partnership.
Rehan Saiyyed
Okay, and the last two more questions. First is what is your loan and deposit growth target for F26? We expect growth to be about 20% for this year. For upcoming years.
Munish Jain
For the FY26 we are targeting a credit growth or loan growth of 20% plus and we intend to improve our CD ratio. So diverse. So we will be calibrating our deposit growth to support over advanced growth. So we always have a deposit being over strong leg. So we are presently also calibrating and after the present interest rate cuts when we see the market price of the liability has optimized then we accelerate our deposit. So. So we are targeting 20% plus advanced growth and deposit will be as calibrated as needed to support this particular advanced growth.
Rehan Saiyyed
And so along with roas and roes. If you just clarify regarding on this also.
Munish Jain
So typically we are talking about the year which is characterized by sharp declining interest rate. We have a low down of 1.4% FY25. We intend to retain and slightly improve the rota in the current fiscal which we have done in FY25.
Rehan Saiyyed
Okay. Okay. Thank you and good luck.
Munish Jain
Thank you Rehan.
operator
Thank you. The next question is from the line of Subham from Tikri Investment. Please go ahead. We seem to have lost the connection with Mr. Shubham. The next question is on the line of Sugandi from Star Union Dai Life Insurance. Please go ahead. Hello sir. Mr. Sugandi, are you there?
Sugandhi
Hi, can you hear me?
Munish Jain
Yes. Yeah, now you are here.
Sugandhi
Okay. I think so. This is Sugandhi from FedEx Securities. I think there has been some mistakes. So just for looking at your you know MFI NBSP book and if you know your India presentation you’ve mentioned you’ve given the breakup of provisions also. So if I just you know take a rough number of your outstanding NBS business slippage 6% and you know how much of this is a one time event. Could you give us some more information? You know since you have mentioned before that and today also that MSI is just 1% so this is compared to whatever exposure we have.
This is sizable and you know how you know, you know where is it coming from and you know what can be expected in the Are you seeing some stress in your nbsp book as such.
Munish Jain
If you look into our book as far as the corporate loan book, we are only having less than 1% portfolio in the MFI segment out of it just this time we have a slippage. There is some slippage because of the present prevailing market scenario. So if I exclude the present stripped accounts or if I talk about my remaining present standard accounts. So out of my present standard accounts 57% of my MFI book is with a saving and we are having around 20% of the MFI book which is a rating of BBB plus or BBB minus or triple B equal and but out of that 20% book we have a 57% cash margin available.
So with that thing in sight so in the present existing MFI book which is standard book the book seems in a good shape and we are anticipating the present skippage which has come in the Q1 FY26 is typically temporarily and only limited to the Q1 FY26 and is not we are not anticipating any further as you can see the aspect or further any outcome from this particular book. Keep in view the present setup available with this and the present outstanding standard book in this particular book is typically 0.75% of the total portfolio and within I just shared with you the further BIC so which is giving us a further strength further confidence that this one event which has happened is temporarily and the slippage which has come is also because of the present aspect which is moving around the MFI industry, we being not MFI player so but just having a very limited exposure to those NBFCs so which has given respect to slippage within the print period.
Sugandhi
So you’re not seeing any stress in your MSME book.
Munish Jain
So we are yes we are not seeing any stress presently from NBFCs having the MSME book typically over NBFC book is typically primarily towards NBFCs who are more in the secured landing. We are not we are not primarily targeting NBFCs into unsecured lending segment. We are primarily targeting the NBFCs who are in a secured lending segment. So that thing in sight we are not anticipating much challenge. We are not seeing any challenge presently. Any challenge in this.
Sugandhi
Could you give us the provision coverage ratio for your four key segments msme, nbsc, Agri and Maltese.
Munish Jain
As far as the PCR as a practice we typically follow maintaining a PCR of 50% plus and even the current quarter despite there has been a increase. So we have created a 50 PCR.
Sugandhi
So within the 50% above all about.
Munish Jain
50% sectors will be between 40% to 55%. So that is a typical PCR you will find across all the sectors. It’s not that 15 each. It will be 40% plus in all the sectors. Maybe agree mortgage or msna book.
Sugandhi
And sir, I just wanted to understand on Haryana we’ve been in the market for many years now. Our presence has been small. But what gives us confidence that why were we holding back in terms of expansion in Haryana and even though we were expanding in Punjab, why were we holding back and what gives us confidence that you know, this time, you know growth will be, you know will happen at the same date as we grew in Punjab?
Sarvjit Samra
No, presently in Haryana we have. 20. Branches and in the current expansion which is going on we’ll be adding say from 12 months to 15 months. We have a plan to add about 13 branches more in Haryana. So Haryana there’s a lot of expansion which is in the pipeline in Haryana. So otherwise as a matter of policy now expansion going ahead, we are majority of the branches we are adding or we will be adding are going to be out of Punjab and Haryana is going to be our key focus area and going ahead. And like in Haryana we have even started going making in depth roads like we have.
We are opening a couple of unbanked rural branches. URC’s rural branch already we have opened. We are there in semi urban towns. So we are making in depth to in Haryana as well. Not only expanding but similarly as we have done in Punjab we are replicating now we call it making Haryana next Punjab which we internally call it and we are in the process of it.
Sugandhi
One final question. You have you know given some kind of target previously about bringing your NEC MPA down to 1% over you know, nine to 15 months. Is there any change to that target or is it something that still seems visible?
Munish Jain
Yeah, as far as the net NP target is concerned. Yes. We were anticipating our targeting to make it below 1% by when last time we talked about that is by this year that by this FA this current fiscal we intend to do it. So we are just keeping our eyes open for this. We are keeping our idea open. At this stage I will not be able to. There may be a scenario. We may be depending upon the macro factors how the factor look like we will be targeting because we want to keep an eye on the rota as well.
We want to ensure that we are continuing to have a rota expansion. So we’ll be trying to create a fine balance between the net NPA number and the rota.
operator
The next question is from the line of Shubham Salvadia from Tickri Investment. Please go ahead.
Shubham Selvadia
Congratulations on a good set of numbers, sir. Yeah, so thank you sir. First question is sir, our borrowing and deposits have grown by 16.4% by while advances have only grown by 14.2% at the same time. So at the same time cash and balances with RBI has risen sharply by 27.7%. So sir, could you please help us understand if the bank is facing any challenges in loan disbursement or a demand slowdown with this liquidity buildup?
Munish Jain
No, that’s not the case. Rather on the contrary, I will not on the contrary, rather I just want to clarify a few of the things we accelerated over deposit growth post the interest rate cuts. Before the interest cuts we were not accelerating over deposit or the borrowing acceleration. If you look into the number growth, the growth which we are talking is typically coming in the last one and a half to two months Whether we talk about the refinance increase or where or in the shape of borrowings or the value talk about the deposit growth in that particular period.
So after the interest rates have fallen down and we are anticipating that the cost of of deposit is sustainable after 100 basic 1 deduction I’m talking about not the first deduction after the 100 basic 1 reduction in the repo then we accelerated both our deposit and the borrowing book to support the what we need to contribute to our so we being intended, we were present in our 81 point plus 81% plus average CDV entity and the Q1 historically is characterized by a muted credit group because of that is the seasonality of the country as a whole.
In that background backdrop the Q1 we had a disbursement which is 15% growth on quarter on quarter year on year basis and 13% on sequential basis. And so that the demand for the advance is not the challenge rather we are we see the good momentum available in the middle income group segment. So that is the way we support we build up the light liability when the market has the liquidity available we picked up the liquidity or liabilities at the optimum pricing to support over deposit advance growth. So as a temporarily the money which we have raised till the time it is deployed in the advances it is being parked in that in the shape you are talking about but that is also yielding a return better than what on which what price we are paying to them.
So we are getting a positive outcome even during this interim period. If you look into the entire period, we are earning more than our cost of deposits or cost of borrowings in both this sense. So in that backdrop, so presently we are not finding anything. Rather we are going ahead with overall internal strategic objective of build the liability at the time when the right price is available and to continue to build advances at the pace depending upon the market opportunities.
Shubham Selvadia
Okay? Okay, got it sir. So my next question is super what measures are we taking up to grow CD ratio?
Sahil Vijay
So CD ratio is a function of the growth between deposits and advances. As I said, if you current quarter we accelerated over deposit since we need to be sufficient liquidity available to advance. So the only measure which is required is continue to accelerate over lending. So Q1 we accelerated both the sites, deposits and advances. Q2 it will be more heavier on the advanced side and bit softer on the deposit side. So this is what we anticipate which will be automatically resultant in an increase in the Chidi ratio in the Q2 and year to come.
Shubham Selvadia
Okay. Okay. Thank you sir. That.
Munish Jain
Thank you Subhan.
operator
Thank you. The next question is from the line of Sonal Minhas from present Cap Investment Advisors llp. Please go ahead.
Munish Jain
Yeah, Sonal, you’re fully audible. But your. Voice seems to be breaking. Could you go to a better reception area? Is it okay now this seems. Yeah, that’s fine.
Sonal Minhas
Sure. I’ll quickly ask my question. The loans have been kind of for the last year or so reducing and the NPS came to the wanted to understand what is happening on the ground on why are you not doing on the ground.
Munish Jain
So firstly you have the question as the two states what is the potentiality of agriculture versus secondly the asset quality agree. If I pick the second question first, that is the asset quality of the agree or just since you already mentioned that that there has been a decline in the outstanding of agree. So because of that decline the percentage looks a bit higher but there’s an absolute value. It is almost static or there is a big change of only hardly a crore or so. So there is no bigger skipping in the quarter in agree so the percent look higher just because of the baseline Effect point number two as we talk about the Q1 historically Q1 is always the period we being as a lander, agriculture based lander, we always lend for the staple crops or we can say MSP crops.
So quarter one is typically characterized by the cash flows which is coming in a big way for that particular crop. Say this is a harvesting period of the wheat. So wheat has. So wheat is one of our preferred crop for landing. So there is a good cash crop cash flow coming from the wheat harvesting and the procurement thereof which consequently will be accelerating over recovery in the agri. If I talk about agri, the current quarter we made a disbursement of around 175 odd crores rupees to the agree. Despite the fact we had a disbursement of around 175 crores of the agree, the agri portfolio has shrinked by around 90 odd crores.
So I mean to say we are able to. That is basically primarily because of the recovery efforts which we are doing and conqueror related to the cash flow seasonality of the agri. So that is the way how the agri portfolio work in the Q2 you will see the agri portfolio will be extremely will be seeing growing. Now if I talk about the.
Sonal Minhas
I had a question like if I were to track the help of agri in the volume of let’s say the volume of MSC produced in D is that going without asking you because is the market growing? Is it growing?
Munish Jain
If I talk about the wheat, yes, the wheat. This time the procurement value of the persons of my farmers, my farmer miss who are maintaining the account with us has improved, has increased. There is an increase we can see in the procurement value, the V procurement versus the last year and that’s a decent increase. So there is a good increase coming in the wheat procurement value basis. So I will not be able to tell you the per hectare. I can tell you the count value, so I have a count of the value. So value wise, yes, we are able to increase the procurement value in the current fiscal versus the last fiscal and we are continuously seeing from the last three consecutive years an increase in this value not only for the wheat and also for the other staple crop that is paddy.
So both the crops we are witnessing a growth momentum building them in each of the year. So agriculture sonal from particular perspective, from the quality perspective, if you look into the various indicators of the quality within the agreement. So during the quarter hardly any write offs or rather over the last three half year or two half year or five half year, we count the period, hardly any write off an agree value basis almost static. So we are getting a return which is typically 12.67% from the agree against 11.2% of the portfolio. Within this the GNP and NNP remain the range bound without any write offs.
And with the recovery of that is there is a slippage is better than the my total slippage. If I talk about FY25 may if I talk about the slippage with an agri portfolio which is my overall slippage I have a better slippage in the agri. I mean to say lower slippage in the agri means better means lower slippage in the agree. So from the quality perspective so agri portfolio is showing a decent outcome. Yes, last year we are not saying that we were very aggressive on the agree we were always telling on our call that we are support going forward for the MSME and mortgage so just we were not that aggressive on the agree because of some at that time some ground level superseded Kishan and Dolan were going on so even that is over.
So I’m seeing a good traction coming back in the agree in the period to come.
Sonal Minhas
Got it. I understand it. One more thing I wanted to understand. We’ve given a guidance of advanced loans which is higher for the subsequent quarter compared to this particular quarter and is that just building the seasonality Is that due to better credit being available as you see June, July and September or it is willing to deposit because we seem to be hovering around 15 18% mark and credit or deposit I’m not able to understand. We seem to be only in this range. So what is it that is the limitation here?
Munish Jain
If we talk about the growth momentum. Growth momentum. If you talk about seasonality perspective before FY25 we will be overbook was showing a higher season when the agriculture was 35% 37% more if we start looking from FY25 or current fiscal so the physicality is almost getting muted. So the growth in Q1 is. If we talk about the Q1 growth on percentage basis and if my I believe my team if it writes data so we have the third highest advanced growth in the service space on quarter on quarter basis if my data is correct. So we are having a good decent growth coming up and Q2 it is not that deposits are not limiting over group now if you look into our deposit and borrowing we raise the money and then look at the pricing cost of fund is also being published.
It is 6 cost of deposit is also being published 5.9 so we are not having any constraint on the liability side and the pricing of or rather we raise now as the interest rate it has been cut down so that we are not like to have a liabilities or the deposits which are very high priced. So that was intent so June, July, September rather I will say there is a just not the there will be a momentum build up plus one more addition since we have 30 to 32% of the portfolio in agree as we discussed despite we disbursed around 200 crores that the portfolio has shown a degrowth in Q2 the cash flow will not be coming from my stackle crops so the disbursement will comes into my increase in my outstanding so the my weighted average will work and my recovery rate versus my my repayment recovery period because recovery period in my Q2 will be reduced in agree and so my all disbursement that I’m doing will be adding to my outstanding whereas in Q1 my recovery rate is so high that my whole of the disbursement is eaten out by my recovery and rather I still have an active route.
Where else look into Q1 last year Q1 current year Q1 any year you will see agriculture always degrown. Now the degrown is very very muted since we have continued to disburse good amount to you in the Q1.
Sonal Minhas
Got it, got it. I can call back.
Munish Jain
I think let the moderator take the view on it.
Unidentified Speaker
So if you would call that in the queue that would be.
Sonal Minhas
Sure I’ll call that. Thank you.
operator
Thank you. The next question is from the line of Nirvana Laha from Badrinath Holdings. Please go ahead.
Nirvana Laha
Thank you sir for the opportunity. So my question is on business model related question. So you mentioned that about 90% plus liability remains in Punjab for you. Can you help explain to us what is the typical profile of your liability customer in Punjab like in terms of profession which districts do they come from?
Munish Jain
Rural. If you talk about over customer profiling I’m not talking just from the liability standpoint but also from the asset standpoint.
Nirvana Laha
I want to understand the liability part. Sorry to interrupt. I want to understand.
Munish Jain
That’S I’m trying to say Nirvan over both the sites or rather over target customer is middle income group customer for liabilities as well as assets. We are not having a separate asset customer segment for any of the segment and within this particular segment irrespective of the economic activity this particular customer segment is coming. We are typically intend to be the primary banker for our customer with primary banker inside that is that his cash flow account shall be with us. Rather than acting as a stand on term land depositor for our customer we intend to have a sharing accounts minister with us.
So with that thing in sight we are typically intend to provide him a very easy start point with a very very Limited minimum balance. But ultimately intent is to have a bigger chunk of his month savings. Statistically if you look into this particular number, our average ticket size in the saving bank account is presently 46,000 rupees per account which was 43,000 a quarterback and 42,000 a year back. So typically and if you look into the average ticket size of our term deposit this is 10 19,000 as on June 30th which was 9.39 lakhs a quarterback and 8.59 lakhs in quarter a year back.
So typically we continue to be a granular middle income group based depositor. The objective is to provide him the complete product range. And this is well spread over whole of the Punjab and other part of the geographies also. Yes, we have a higher concentration on the Suru for our deposit franchise. If we talk about the Suru Shuru typically which is presently constituting around 76% of our branches are contributing 74% of our deposit. Over 74% of our deposit is coming from Samiyabana rural area which is counting for 76% of our branches. So we are not raising very high priced deposit from the urban.
Rather over deposit is coming more from a semi urban and rural where we have a thicker brass presence. And that constituting again I’m retreating 74% of our deposit. So deposit profiling is purely retail centric, middle income group centric and with the intent to be their primary banking relationship.
Nirvana Laha
Thank you. The intent for my question sir is if you look at your liability customer as in the FD rate and the savings account rate that you’re providing. What I want to understand is how are you able to compete with public sector banks, private sector banks which have been there for many many decades and still win over liability customers with such low savings account and fix deposit rate and how will this scale? I understand you’ve been in Punjab CE here and therefore your brand is very strong there. But in other states. How do you think this liability.
Munish Jain
Lab? We always believe liability will follow the trust with that thing in sight. Over branch expansion philosophy is a contiguous branch expansion philosophy. That is we keep on adding to the the next geography. And within this we follow the process of combing and carpeting. That is you following opening a branch at economic headquarter then carpet all across. So the customer whenever move around he find one or another branch of us which bring in the trust. So with that thing inside we are able to get the customer. And that same philosophy we are following in the other geographies.
What we are Getting a response from the Punjab is the start small Haryana start giving us a similar type of of response. If we talk about the Haryana response is also the exactly the similar. And if we talk about the growth potentiality we are growing over deposit with 18% target. And that is consistently. That’s not the case that we are not growing. We are growing it able to 18% consistently. And that too with a longer period origin and pricing structure basis. If you look into our pricing philosophy you will find we are be paying around 30 to 40 basis points more than HDFCS of the world.
From HDFCS of the world my talking about top line public sector private sector banks. So there is a premium which we are providing to the customer. But we are not mapping over deposit pricing with all the other players on the street. Just we map it with the top three players. We are presently the fourth largest private sector bank in Punjab in term of the branch network. So and we are intending to make Haryana or the similar footprints. And we want to make Haryana our next work frontier. And the philosophy is similar carpeting and giving a premium on the top three banks.
So we are paying a premium over them also. And that’s the way and providing in a holistic product suit single customer service all products at a single window at a most efficient price local people. So lots of other small small actions we do and over deeper understanding of the liability market. We are a 24 year plus liability player which helps which help us understanding this market better and know how to do it. And I can validate this that the current quarter we increase over deposit by 9.5% and with the cost of deposit of 5.9.
Nirvana Laha
Can you share the CAGR growth rate of your ex of Punjab all the other states how the deposit rates have grown in the last 34 years. That is one question. The second question is pre IPO used to grow about 13 14% return on equity. In how many years do you think we will be able to get back to that ROE?
Munish Jain
If we talk about over deposit growth momentum on we grow out of Punjab with a growth rate to Kagar from 2021 to 2025 out of Punjab at 35.69%. So that is the Kagar we are having out of Punjab for the deposit franchise. So point number one. Point number two when we talk about the ROE when we hit the capital market over exit ROE was 16 plus for annual basis and 17 plus on a quarter end basis. So that ROE is the outcome of the leverage versus the roe. We are continuously improving a ROE since we listed and before even that and we intend to improve our ROA with each passenger.
Now we are consuming over capital and we are now in the right spot of consuming over capital with the. With the capital consumption over leverage will keep on improving which will be hitting us helping us in moving towards the ROE which you have mentioned. Rather we intend to have a better ROE than the numbers we are talking about. So since the rotax pension is consistently opening and now we raise the capital and because of the macro factors the advanced growth which we intend to have but which we that caution in the last year not to get overboarded on that growth to ensure the asset quality standpoint.
Now with the macro factors on certain the area which we are geography we are operating the segment we are operating we are seeing a good traction and intend to grow 20% plus in the current fiscal for the advances. So we believe just we are on the right track to move towards that ROE guidance. ROE numbers which towards the pre IPO levels.
Nirvana Laha
It’s a pre IP on leverage of eight times like you used to be leveled eight, eight and half times I think. Do you think you will be comfortable pushing up the level to eight times?
Munish Jain
At that time our rota was low and leverage were high. Now we are talking about a higher rota with the optimum leverage and that.
Nirvana Laha
Is at the current level that time.
Munish Jain
Our Rota was also 1 is and we are 1.4 already last year and we continually improving router.
Nirvana Laha
Okay, sure sir. Thank you so much for the answers.
operator
Thank you. The next question is from the line of Anant Mundra from my Temple Capital. Please go ahead.
Anant Mundra
Hello. Thank you for the opportunity, sir. So the MFI pain has not fully been absorbed because there is still a 14 net NPA which is there in that account. So why did we not take the pain completely this quarter? Or are you expecting this to you know, upgrade and become a normal asset?
Sarvjit Samra
Actually discussions are going on with regard to recovery and we hope that we’ll be able to recover out of that. That is. That is the reason why we have not taken the whole of the base provision for whole of the above.
Anant Mundra
Yeah. Okay. Okay. So one more thing was that the RAM engine that we have done mainly the agri and mortgage portfolio is not firing as we would expect. Because a lot of the growth is also coming from you know, the NBFP non MFI that has grown 60 year on year. Because when we think of a bank. We think of a bank which is. Serving the MIB segment and we really expect the RAM segment to be firing in that case. But the growth is coming a lot from NBSCs non MFI. So when can we expect, you know these three segments tram segment to grow more than 20% while the NBFCs take a take a back seat.
Munish Jain
If I anant if we look into the mortgage mortgage we have two subsets Housing loan and a LAP housing loan. Given EBL linked we were a bit cautioned in the last year to accelerate the housing loan book because we were anticipating a sharper rate cuts. So if we look into the mortgage within the mortgage, if you look into the nap Overlap has grown 22.6% in June 0 year 5.4 and quarter on quarter MSME 25.6 on year on year 9% on quarter on quarter. So so that show the RAM engine is not properly firing. So both the product just housing we were consciously slow given at that time.
I am landing at the rate with the cut of interest rate so sharply. So my P and L would have been taken ahead. So we typically intended intentionally that within the mortgage over agreeable housing which are around 50 to 51% now is sitting at 44.5% or 55%. So we continuously in that direction. Now we are still anticipating one more rate cut but that will be a bit muted cut. That will not be that sharper rate cut. That is what our internal anticipation is. So accordingly we are start evaluating to accelerate the housing loan. And that too depending upon the pricing, the type of the pricing which this model developed.
My housing is coming so there has to be limited time pain when we were accelerating overlap within that. Now that development has done and LAB is Now majority of it 55% pass. So and LAB is complete now complete firing the current quarter. We have a quarter on quarter sequence of 5.4 within the lap within the mortgage. So for all the three of hiring just corporate loan bookers optically looking more because we were having a lower ads after the capital raise. So there is not making a prudent sense that since we were blending it a very lower value per customer.
So we were just optimizing that particular value per customer Rather than keep on adding more and more NBFCs. We are not adding more and more NBFCs. We Are keeping our portfolio synced to 45 to 60 or 65 MFI or NBFCs only. So we have a total NBFC pool of 45 to 65 and we intend to maintain within that pool which is over targeted NBFCs. So within that NBFC we are just going just because of the kaplan Fusion we feel there is a good opportunity to improve the ATS and which is further seconded because of the PSL guidance.
It cut it from 75 to 60 which is give us an additional legroom to opportunity to grow this particular book. But still we are very conscient on our corporate loan book growth and we have not grown it left, right and center. We grow it typically in a muted environment. And if you look into our disbursement, our Highest disbursement is MSME. Second highest 23 is corporate and that too if I mean mortgage is 20%. So we are typically very creeping a very fine balance on our outside disbursement number that my disbursement should be ram heavy.
Anant Mundra
Got it. Got so and any color on the agri loan portfolio because that I mean can we expect that also to grow more than 15 20%?
Munish Jain
I believe my our first target is to grow our agri portfolio in double digit agri portfolio. We as I said we are typically earlier last year we were growing it but in a caution environment. Now the ground and everything is now completely cleared. So now we want to grow grow the agri portfolio in a double digit environment. Over the period to come you will start seeing agri portfolio growth in a double digit in the period to come after now you will always see it at lower single digit. In the last four to five half years.
Since agri growth has to be monitored on a halfway line on a quarterly basis. In last three to four half years we were seeing our agri portfolio growing in a single lower digit. Now we want to take it to the double digit growth in the period to come. And necessary the guidance is internal alignment has been done to ensure that we do it as a period to come.
Anant Mundra
And so the lever for this growth will mainly be Punjab only. Right. Because Haryana we are focusing mainly on MSME and mortgage. Is that understanding correct?
Munish Jain
We will be doing some portion of agri in Haryana also but not in a larger way but just Haryana in good agri belts we are open for the agriculture landing.
Anant Mundra
And then my final question was on the other income which appeared slightly muted this quarter. So both on a year on a year basis and a quarter on quarter basis it’s appeared slightly muted. So anything that you would want to call out over here.
Munish Jain
My request Anant, if we just look into this number again on a quarter on quarter basis. On year last quarter Q1 over other income was 16.6 crores and in Q1 FY26 it is 23.4 crores. This is a growth of 38% oh sorry sorry. I think I just request we’ll have a look into the number. There is a 38% growth in our other income on quarter one versus quarter one and it is widespread. It is not from a one of the segment that all the segments all over four subsets within our non other income which we are talking has town now starts showing the same sign.
Anant Mundra
Got it. Got it. Thank you sir. That’s it. Thank you.
Munish Jain
Thank you.
operator
Thank you. The next question is from the line of Divyansh Gupta from Latent PMS. Please go ahead.
Divyansh Gupta
Hi Manish and hi Mr. Samra. Couple of questions regarding the MFI NPA. So was it a surprise for us anything that was giving us earlier signals and second is and while we had mentioned that it’s temporary and we are hoping that we’ll have some recovery any progress that has happened in let’s say the month that has gone by?
Sarvjit Samra
No say otherwise since we are not into direct MFI and we have never been since even our local area bank days like we have never done a direct lending to MFIs. So even when we built our corporate NBFC book we were very very conscious though there were good proposals coming in but keeping aligned with our TNA and philosophy. You would have to appreciate that even in good times we didn’t build up this book aggressively very selectively but now every we all are aware the way the sector has behaved especially during last for some time. So it is so we have to live with it.
So as we see everyone has been hitted with the MFI exposure. So otherwise with regard to this our recovery teams and accrediting they are continuously in touch with the with the lenders from where this delinquency has come. So we are quite hopeful that we’ll have we’ll able to crash the recovery in these accounts in the time to come. But sorry you were saying no otherwise. If we see the main book for NBFCs which onward lend to which do skewed landing we have like have been very cautiously and regularly we are monitoring it. I think there are no signs of any concern in that book. And and even if a couple of the other MFIs also other than these two there are no signs of such any signs of caution.
Divyansh Gupta
Just one question on the mfi the second question so is there anything the DPD book for either the NBSE or the MFI basically means BPD90 but I am asking anything between 1 to 89.
Munish Jain
You mean to shame the corporate loan book? Yeah. So presently in the corporate loan book we are not having any SMS which has been turned into NPM we are not having any SMAs neither 0, 1 or 2.
Divyansh Gupta
The second question was that we mentioned that 99.8% of our loans are secured and 79 is by property holder FD so two questions regarding this so first is that what are the other assets and second is how do we secure loans when we are giving to nbsc because if they are giving equivalent every day then they don’t actually require loan so how do we secure loans when we give to corporates, corporate NBFCs or MFIs?
Munish Jain
When we talk about divyance about over security we are talkingly we are giving the two versus verticals two statements one is 99.8 being secured that is NBFC book is secured against the receivables and second number we skip about 79% which we are looking is collateralized so if you exclude the corporate book which is around 14% remaining book I have we have a collateral oblique bank FTR in with us available so that is the how we tell yes NBFC book We have a two type of securities one is the receivable and second FLDGs in certain customer segments that is what we do in for certain value of the loan it’s not 100% if it is 100% or no loan is required it is to some extent maybe 5 to 10% in every whatever case we feel there is a higher there may be which warranting us to take an FLDG from that particular gentleman so that is the how the corporate load is and if I talk about the other loan other loan which is presently constituting 7% of the book is typically consisting of the consumption loan to the company customer segment who are availing either agriculture mortgage or the MSNB farmers and they are looking for the other product needs maybe auto financing, gold loan, consumer durables, loan against deposits, loan against FDRs that is typically what is the other loan look like if not a other loan of 7% there will be around 2 and a half percent or 3% of the book which will be against our own FDR the government securities.
So that is a 7% of the book which will be look like for this so which will also have some component of appeal is and but no collateralized but you will find a collateralized in agriculture mortgage and msme.
Divyansh Gupta
Got it, Got it. And couple of questions regarding this PSL which has reduced right? So does it open PSLC as a line of business for us are we working on it or how should we understand this this relaxation that RBI has given.
Munish Jain
It’s a very welcoming relaxation I will say that is the arbitrage between SAB and UCB has further been reduced. So this is giving us a two side of benefits. One side of benefit that is product evaluation that is which we are talking earlier before we can be able to build over lab book within the mortgage in a more freely environment. So so that we can we are not restricted by the growth because earlier we need to ensure that my non PSL does not exceed 25% now which is increased to 40 which is giving me a further opportunity to grow and accelerate all the speed as we move forward.
So that is a bigger benefit I am seeing from this particular change from PHLCs. This to some extent, yes. But such PHLC if you look into the market pricing of the PHLC other than agriculture book so we’ll find that they are very very muted. So that typically is a very very lower values. So if we count it on a value basis you will not be able to make a bigger money out of that. The bigger money staying in small and marginal. So that is where the bigger money is there. But that money that is a portfolio which we are not intend to build.
And so PSLC basis just I will say not a bigger benefit I can sense but just from the growth opportunities and potentiality to grow and risk averse growth I feel it is giving us a better opportunity as we move forward.
Divyansh Gupta
Got it. And just the last question. So we have like we have made an ambition that Haryana is going to be our next Punjab. Right. So from a numbers perspective is there a defined target? Where are we in that journey? If you can give a sneak peek into that.
Munish Jain
If I just give you statistically presently in the lending book Punjab is constituting 77.4% of our loan book. The same number was 82.7 a year back that is 31st of March 2024. So we are improved this number from 82.7 from 31st of March 2024 firstly to 78.8 as on 31st of March 2025 and from 31st 1st of March 2025 78.8 has reduced to 77.4. So we are continuously making an improvement in out of Punjab loan book. So that is the target we are always maintaining. And so we continue to believe that we will be continue to diversify our book.
And the new states has transferring the early good signs so we are confident of taking it further. So is it only the loan Book which is the number that when we. Say Haryana is next Punjab or on liability.
Sarvjit Samra
Site. If I talk to Vyan we share earlier liability site at 21 to 25 over deposit has grown by 36% Gagar out of Punjab. But that can be also on a very small base. Not that many colors. Even the out of Punjab loan book is the deposit book is what not not that many plus yet presently out of Punjab loan book is the deposit book is around 9.15% which was if I talk about a year and a half back it was 6.11%. So the 6.11% was the outer Punjab deposit book which was 3-31-2024 which has improved to 9.15% as on 6-30-2025.
So we are able to accelerate this number in a big way. Good way.
Divyansh Gupta
Got it. And what will be a target number. For these.
Munish Jain
Target on this number. But we want to continue to improve this percentile that is moving reducing over dependency on Punjab. But yes Punjab is over home state and having a huge potential. And we know the state well. So we also want to explore the opportunities which is available in the state. Same we being a secure lender. So we are not having the challenges which may unsecure lender may have in his state. So yes we will intend it to continue to diversify. But intend to also to ensure over accelerated growth also from Punjab.
Sarvjit Samra
But I just want to add one more point here that when we converted in 2016 we were only in five districts of Punjab. So during the this after conversion during as FFB lot of expansion has itself happened. Natural expansion has happened in Punjab. So that that’s the reason why Punjab book also looks happy. So we were 40 only 47 branches in five districts of Punjab in 2016. And at present we are 164.
Divyansh Gupta
So and can I ask one more question.
Munish Jain
I think we have a more queue. If you can come in a queue team member.
operator
Thank you. The next question is from the line of Pritesh from Dam Capital. Please go ahead.
Pritesh
Hi sir. Good evening. Good afternoon. So above questions one is on this NPA what kind of a security we have on the account and till when that can be recoverable.
Munish Jain
Typically NBFC MFI book is typically being secured by the receivables. So the security we have is the receivables. And so I cannot be able to develop detail account wise because that will be my strategical out. But we do have some other in other right also available with us. So we are mindful of it and we are moving ahead. But if I talk about I don’t NBFC lending it doesn’t typically doesn’t have a collateral with the attached with the landing. So there is no collateral removable collateral attached with it. Just receivables are available with the promoter margin.
So that is the first right available as we do have a personal guarantees also available in these cases.
Pritesh
Got it. Just wanted to clarify on the 14 crores slippage we have been 50% provision right.
Munish Jain
On we total PCR is 50% on this slippage we made a 35% provision 35 right.
Pritesh
So. So if if I want to see that means the if I if I remove this number from the oral cohesion that means the Q1 number X this NBFC provision is slightly elevated right. So any reason for that? Because the PC has improved Typically if.
Munish Jain
We exclude this number and look into the credit cost perspective over credit card is 0.37 out of this 0.19 towards the sector. So overall credit cost will remain in the range which we always talking about 0.1 to 0.2. So that is what we are having. And if we talk about the PCR standpoint we intend to maintain a 50% plus PCR if we are iron it move it out of both the denominator and denominator over TCR will be higher than 50% slightly maybe 52 or 53 or percent so in both the senses since over stated objective is for this particular these two specific cases in the quarter one only we intend to take a 35% provision being a MFI based book so regulatory requirement being 15% but we operate voluntarily to go ahead with the 35% provision so that we can recover the we are confident of recovering the remaining amount.
Pritesh
On the deposit side if I look your retail deposit is now at 89.5 I think so that means the bulk deposit we have grown the bulk deposit higher. Just wanted a color on what rates we would have got those deposits and what is the typical tenure on that.
Munish Jain
We typically raised all deposits after the rate of interest has been cut. Always we are getting an opportunity for this money but we are resisting since the price offered at that time are significantly higher. And this money which we are typically raised we are not a significant bulk. We are just as a minimal bulk the retail being the bigger driver. This we typically raise the bulk for the one year term and but post the rate after the second rate cut. So we have not raised the deposit still it is a second rate cut has not come.
Pritesh
So the Typical rate which you will raised at about will be about six and a half. Is it?
Munish Jain
No bulk deposit even my prime presently term deposit, retail deposit is at 7.115. So I’m. So it’s not the market rate which you’re talking but it is a competitive one and which we can absorb and which is not giving us any challenges in over managing over cost of deposit.
Pritesh
Got it, Got it. So, and for large data tipping question last quarter or customer base was 7.8 lakhs. This quarter it shows 7.6. So we’ve lost about 20,000 customers, is that correct? Because we’ve not lost customers in long time and this is showing a decline.
Munish Jain
It is not the case. Actually it is the cleansing activity has been done during the current quarter that any customer which is there in the cast IDG is being created but not having any portfolio or is running in operating for a longer period. For a period of very long period. So we cleansed and cleaned out that particular thing. Otherwise our acquisition run rate continued to remain the stack the same which we were in the Q4 or the last years. So yes, this period we done a cleansing activity to cleansing those particular customer out of our.
We just flushed out so that the data remain polished. Given that we are not having any higher in operatives so we are not having that challenges that’s in zero balance or a lower balance accounts which is posing as a decent risk. So cleansing has been done in the current quarter. So which is maybe optically showing it but otherwise run rate acquisition is a similar.
Pritesh
Okay, got it. Thank you so much.
operator
Thank you. The next question is from the line of Ashisha from Business Match. Please go ahead.
Ashish Shah
Hello, good afternoon sir. Thank you for taking my questions. I have three of them. Can you guide on the credit cost for the full year taking now this provision that you’ve done in the first quarter.
Munish Jain
We strongly believe in the coming three quarters we will maintain our credit cost in the delta of 0.1 to 0.2.
Ashish Shah
So we don’t see any spike over there for the rest of the year.
Munish Jain
So that is what we anticipate.
Ashish Shah
Okay, and just secondly, can you guys give us some understanding on how do you see the margin in light of about the rate cuts, how the yields will behave and you know the costs are again going down this quarter. So how do you see the margins for the year?
Munish Jain
So if you look into the Q1 we have a 4.1% NIM against 4.1 last quarter, 4 last year. So despite a very strong sharper it cuts. So we Are able to maintain over net interest margin. So we intend to maintain it around the same level plus minus few basic points. So we have done a various working for the same. One such big working is over the last one and a half year we were continuously increasing over fixed rate advanced book over fixed rate advance book present is 47.4% as on June 30th with was 38.79 as on 31st of March 2024.
So we improve it by 8 and a half to 9 basic points percentage from over last 15 months. So with that is the one big driver which we are looking for the fixed rate book is growth and secondly over EBL book growth is around 11.25%. 11.25% is over EBL linked. So over impact of the rate cut is typically only 11.25% book which is coming straight way and other cut will be coming through the MCLR link with the MCLR link with cut. So that will be which will be coming along with it.
Ashish Shah
Okay, that’s very interesting.
Munish Jain
So we are confident and the third driver which is available in the CD ratio we are now at around 81% CD ratio. Over the next coming three quarters we intend to improve the average ratio which will be giving us a benefit of the name.
Ashish Shah
One last question is on Haryana. You know we’ve been there in that state for a few years now. So what drives, you know what what gives us, you know this confidence and conviction to meaningfully ramp this up over the next two, three years. Because we’ve been there for so many years now. It’s been maybe seven years, eight years. So what has changed in the last, let’s say now the next 12 months.
Munish Jain
So typically we when we started the Haryana and we started in the year 2006. So then Covid hits. So two years have washed out of the growth during the COVID period. So post the COVID period we have started building up back in the Haryana and over build up to post the COVID I.e. 2023, 2023 onwards has started giving us a good results and the branch expansion has been ramped up accordingly. So because optically you will say that our first march has been open at that time. But those branches are giving us a decent returns. But post Covid, given the COVID there has been some sort of muted period for two years or so for the Haryanas or that state.
And now post the COVID out and the new branches are start ramping up. So and being we now understand that geography and we are start looking we Are almost in everywhere now in Haryana. And now we are moving towards the carpeting. There’s no thing comping has been done and the carpeting is started. So with that thing inside which is giving us a higher confidence for the Hyalla.
Ashish Shah
Thank you so much sir. And all the best.
Munish Jain
Yeah, thank you.
operator
Thank you. The next question is on the line of Shahzad Shroff from D Meter Advisors. Please go ahead.
Shahzad Shroff
Thank you for the opportunity. I had just one quick question. So earlier in the call you mentioned that in the previous years our philosophy was because of lower ROA we were maintaining higher leverage. And now ROA has improved and it is still on the improving part. So what do you think will be the optimum leverage that we would like to maintain going forward?
Munish Jain
If we talk about that particular question in the pretext of that particular question. First of all, we need to calculate the leverage of from the two perspectives. One is the balance sheet leverage. One is the advanced leverage. We were typically having a lower CD ratio company at those period. So the balance sheet lever was typically higher. Now going forward, now we raise the capital and consequently at that time delta between ROA and ROA was much sharper. If I talk about the return on my overall assets versus return on my average advantage, that is much sharper.
And as we are moving towards after the capital raise, we are in the intent to increase the CD ratio so that the gap between ROA and ROA continue to shrink. Even presently we are having a 1.5x delta between ROA and ROA. So as we move forward with the intent is to continue to improve the Rota by improving the average CD ratio. Angela. So by deviating in to the three levers, that is the minimum expansion, non interest income expansion and optimizing the cost per cost income ratio. So with these three drivers, our target is to continue to improve have the Rota expansion.
With the Rota just the regression ROTA is continually expanding since 2000, since last 5 year plus we are every year improving the Rota. So now with that thing in sight, so with that particular inside, with the Rota expansion, we will with the leverage, which is optimal leverage for a secured lender like us. Like it is a balance sheet leverage versus the advanced lever. So that if you talk about the balance sheet lever, say we are typically looking over 8 and a half to 9 and a half percent balance sheet lever or 9 to 10% balance sheet lever and the advanced lever of 6 and a half or 7 and a half or say maybe 7.
That is the lever you will look into the advanced side so you will find the best factor. RO is coming presently just this quarter despite the higher credit cost over ROAA is 1.8 and over ROAA FY25 was 2.1. So with that type of lever that is giving us a confidence of coming back to those roes as we move forward.
Shahzad Shroff
Understood sir. Thank you.
operator
Thank you. The next question is from the line of Shubham Silvadia from Tickri Investments. Please go ahead.
Shubham Selvadia
Sir. During this quarter like YOY There is a 38 increase in other income. So are you exploring any other product to boost other income or targeting any other segment?
Munish Jain
As far as Subam offer other income philosophy is concerned we other income we typically split ourselves into the three to four pillars. Three to four journeys. One is the advanced related other income the second is the over operations or the payment generated other income. Third is over banker other income and fourth thing over other forex income within the banker income. We continue. We are just opening over. We are continuously looking forward for the other product opportunities. We continue, we will, we are and we will continue to explore what are the opportunities available to in invest increase the bank earning that is a third party product salary.
In addition to this we continue to look forward for the other other income income expansion from all these four verticals Be it the advanced rated which we have increased from 4 crores in Q1FY25 to 7.2 crore in Q1FY26 related we increased from 4.8 crores to 5 crores banker we increased from 6.6 crores to 9.5 crores. And the forex plus treasury put together early it was 1.6 it is 1.7. So all the four limbs of the other income are contributing and moving in the direction. So we continue to look forward for the other opportunities which is available to ensure that we can’t.
That is our stated objective to improve our non interest income as we move forward.
Shubham Selvadia
Okay. Okay. Thank you.
operator
Thank you Ladies and gentlemen. In the interest of time this would be our last question. I would now like to hand the conference over to the management for closing comments.
Munish Jain
I would like to thank everyone for being part of this call. I hope we have answered all your questions. If you need any more information please be free to connect our investor relations team or sga our IR advisors. Thank you and have a nice day.
operator
Thank you on behalf of Capital Small Finance Bank Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines.