KOCHI: ESAF Bank slipped into the red in the June 2025 quarter, posting a net loss of Rs81.2 crore against a net profit of Rs62.7 crore in the same period last year, as asset quality deteriorated and interest income fell sharply.
Net Interest Income (NII) dropped 35.8 per cent year-on-year to Rs377.8 crore from Rs588.2 crore, underscoring the strain on core earnings. RSAF Bank Gross Non-Performing Assets (GNPA) ratio rose to 7.48 per cent from 6.87 per cent in the preceding quarter, while the Net NPA ratio climbed to 3.77% from 2.99% sequentially, reflecting heightened stress in the loan book.
The weak set of numbers rattled investors, with ESAF Bank shares having closed at Rs30.40 on NSE after losing 3.15 per cent in value on Friday. The stock has now lost over 30 per cent of its value since the start of the year.
Analysts said the worsening asset quality and steep fall in NII signal mounting challenges for the lender, which will have to navigate tighter margins and higher provisioning pressures in the near term. The bank has yet to disclose its strategy for arresting the slide in asset quality and returning to profitability.
ESAF SFB, which primarily serves the unbanked and underbanked segments, had been on a growth trajectory in previous years, but the past few quarters’ performance raises concerns over sustainability amid a more challenging credit environment.
