YES Bank Q1 Results FY26: Profit jumps 59% to ₹801 cr

Key takeaway from the June quarter

YES Bank reported a sharp improvement in profitability for Q1FY26, with net profit rising 59.4% year-on-year to ₹801 crore and 8.5% quarter-on-quarter. The bank attributed the performance to a combination of higher core income, stronger non-interest income and a reduction in cost of funds. Operating profit for the quarter rose 53.4% year-on-year to ₹1,358 crore, indicating that the improvement was not limited to one-off line items. The quarter also saw stronger reported treasury outcomes, which lifted other income materially compared with the year-ago period. At the same time, asset-quality monitoring remained in focus as the bank disclosed higher gross slippages versus the previous quarter. Multiple data points circulated in the period, including a provisional operational update and consolidated financial highlights, which show different headline loan and deposit numbers depending on the disclosure.

Profit, operating profit, and what drove the change

The bank’s Q1FY26 net profit came in at ₹801 crore, compared with ₹502 crore reported for Q1FY25. Operating profit stood at ₹1,358 crore in Q1FY26, up 53.4% year-on-year and 3.3% quarter-on-quarter, reflecting improved revenue traction and operating leverage. The bank also reported that provisions for the quarter more than doubled year-on-year to ₹360 crore, an important context point alongside the profit growth. In parallel commentary carried by PTI, the profit expansion was linked to strong gains from treasury operations and a sharp rise in non-core income. This mix matters because it shows the quarter benefited from both core banking metrics and market-linked income streams.

Net interest income and margin movement

Net interest income (NII) for Q1FY26 stood at ₹2,371 crore, up 5.7% year-on-year and 4.2% quarter-on-quarter, aided by a reduction in cost of funds. Net interest margin (NIM) for Q1FY26 was reported at 2.5%, described as trending upward year-on-year. The bank said NIM was supported by a reduction in deposits made in lieu of priority sector lending (PSL) shortfall and a savings account rate cut reduction, partially offset by repricing impact. Separately, an update noted NIM rose 10 basis points year-on-year to 2.5% during the quarter. For Q1FY25, the bank had reported NIM steady quarter-on-quarter at 2.4%, providing a clear reference point for the latest margin expansion.

Other income jumps as treasury swings to gains

Non-interest income in Q1FY26 was ₹1,752 crore, up 46.1% year-on-year and 0.7% quarter-on-quarter, aided by treasury income. PTI reported other income surged 46% to ₹1,752 crore and that treasury income swung to a gain of ₹484 crore from a loss of ₹32 crore in the year-ago period. This swing is significant because it explains a meaningful part of the year-on-year profit momentum in a quarter where NII growth was mid-single digit. The bank’s disclosures also framed the quarter as one where non-core income played a larger role than in Q1FY25, when non-interest income was reported at ₹1,199 crore.

Loan book growth: multiple reported figures and what they indicate

YES Bank’s reported loan growth varies across the different disclosures shared in the period. In its Q1FY26 results disclosure, the bank stated net advances at ₹2,41,024 crore, registering growth of 5.0% year-on-year. A provisional operational update ahead of results placed loans and advances at ₹2,41,355 crore as of June 30, 2025, down 2.0% quarter-on-quarter from ₹2,46,188 crore, and up 5.1% year-on-year from ₹2,29,565 crore.

In another set of consolidated financial highlights referenced in the same information pack, net advances were cited at ₹2,73,445 crore, up 11.1% year-on-year and 6.2% quarter-on-quarter, with growth described as driven by acceleration across business segments. That section also highlighted segment-level trends: Corporate and Institutional Banking advances up 19.7% year-on-year, Commercial Banking advances up 14.5% year-on-year, and Retail Banking advances up 4.7% year-on-year. Separately, another update on advances said they increased 5% year-on-year to ₹2.41 lakh crore, propelled by a 19% rise in commercial banking and an 11.2% increase in micro banking, while retail advances rose by 0.3%.

Deposits, CASA, and customer acquisition

Deposits, like advances, were presented through multiple numbers depending on the update. The bank’s Q1FY26 results disclosure said total deposits were ₹2,75,843 crore, up 4.1% year-on-year, with continued focus on granular, low-cost deposits. The provisional update showed deposits at ₹2,75,921 crore as of June 30, 2025, down 3.0% quarter-on-quarter from ₹2,84,525 crore, and up 4.1% year-on-year from ₹2,65,072 crore.

The provisional update also stated CASA deposits were ₹90,347 crore, down 7.3% quarter-on-quarter but up 10.8% year-on-year, with a CASA ratio of 32.7%. In another consolidated snapshot, total deposits were cited at ₹3,18,969 crore, up 12.1% year-on-year and 9.0% quarter-on-quarter, with CASA deposits at ₹1,11,959 crore, up 14.9% year-on-year, and CASA average quarterly balance (AQB) growth of 11.2% year-on-year. The bank also said it added approximately 251,000 new retail CASA accounts during the quarter. It further disclosed that retail and small business deposits (as per Gross LCR definition) rose 9% year-on-year, and that CASA and retail term deposits together accounted for 65.5% of deposits, compared with 64.4% in Q4 FY25 and 57.6% in Q1 FY25.

Asset quality watch: slippages and provisions

On the asset-quality front, PTI reported gross slippages rose to ₹1,458 crore during the quarter from ₹1,223 crore in the preceding three months. Management commentary in the same report indicated that two business accounts that slipped are likely to return to performing status soon. Alongside this, the bank reported provisions for the quarter more than doubled year-on-year to ₹360 crore. These two metrics, taken together, provide context on credit costs even as the bank reported stronger profitability.

Liquidity and balance-sheet ratios from the provisional update

The provisional operational update also disclosed select ratios. Credit-to-deposit ratio increased to 87.5%, up from 86.5% quarter-on-quarter and 86.6% year-on-year. Liquidity coverage ratio (LCR) improved to 135.7% from 125.0% last quarter, though it was slightly lower than 137.8% a year earlier. The bank noted the figures were provisional and subject to final audit, which is important when comparing them with the final financial results.

Snapshot table: headline metrics reported for Q1FY26

Provisional operating metrics table (June 30, 2025)

Why the quarter matters for investors tracking YES Bank

The June-quarter print combines three threads investors typically watch in a bank result: margins, fee and treasury income, and early signals on credit costs. YES Bank’s NIM at 2.5% and NII at ₹2,371 crore point to a more supportive funding environment, with the bank explicitly linking performance to lower cost of funds. At the same time, the 46% year-on-year rise in other income and the treasury swing reported by PTI show that non-core income made an outsized contribution in Q1FY26.

But the rise in gross slippages to ₹1,458 crore and higher provisions of ₹360 crore underline that asset-quality metrics still need close tracking. The provisional operational update also showed a quarter-on-quarter contraction in loans and deposits, even as year-on-year growth stayed positive, which can influence how markets interpret momentum beyond the headline profit number.

What to watch next

Investors will likely track whether the margin improvement sustains after repricing impacts and how the bank’s granular deposit strategy evolves, given the quarter-on-quarter dip in deposits in the provisional update. Another monitorable area is credit cost, in light of higher slippages and provisions in Q1FY26. The bank has also highlighted growth in retail CASA accounts and the rising share of CASA plus retail term deposits in the mix, which can be relevant for funding stability in subsequent quarters.