Bandhan Bank share price

Bandhan Bank Share Price Rises Amid Strong Q2FY25 Business Update

On Monday, October 7, 2024, Bandhan Bank’s shares saw an uptick, climbing 2.88% to hit an intraday high of ₹192.30 per share. This surge in the private lender’s stock comes on the heels of a robust business performance in the second quarter of financial year 2025 (Q2FY25), sparking renewed interest from investors.

Bandhan Bank’s Impressive Q2 Performance: A Growth Story

Bandhan Bank has been making headlines for all the right reasons. The bank’s loans and advances grew a solid 21.4%, reaching ₹1.31 lakh crore in Q2FY25, compared to ₹1.07 lakh crore in the same period a year earlier (Q2FY24). This growth underscores the bank’s strong lending momentum, driven by both microfinance and traditional banking operations.

Not only has lending grown, but Bandhan Bank’s deposits also saw a substantial boost. Total deposits surged over 27% to ₹1.42 lakh crore, as opposed to ₹1.12 lakh crore in the September quarter of FY24. Investors are taking note of this positive trend, signaling confidence in the bank’s ability to capture market share in the highly competitive banking sector.

Retail Deposits and CASA Ratio: Navigating Shifts in Consumer Behavior

While the bank’s retail deposits, including Current Account Savings Account (CASA), jumped 16.4% annually to ₹96,603 crore, there was a slight dip in the CASA ratio. The ratio declined to 33.2% in Q2FY25 from 38.5% in Q2FY24, reflecting changing consumer behavior and market dynamics. Despite this drop, the bank’s overall deposit growth remains solid, which will likely fuel its expansion efforts in the coming quarters.

Leadership Updates: Steering the Ship

In leadership news, Bandhan Bank’s Board of Directors approved a one-month extension of Ratan Kumar Kesh’s term as interim Managing Director (MD) and Chief Executive Officer (CEO), effective from October 10, 2024. Kesh has played a pivotal role in guiding the bank through its growth phase, and this extension ensures continuity in leadership as the bank navigates its next steps.

Bandhan Bank: A Journey from Microfinance to Full-Fledged Banking

Established in 2014, Bandhan Bank has always been focused on providing financial services to underbanked and underserved communities across India. The bank has come a long way since its humble beginnings as Bandhan Financial Services Pvt. Ltd. (BFSL) in 2006. Initially, it grew to become the largest non-banking financial company-microfinance institution (NBFC-MFI) in India.

In 2015, following the acquisition of a banking license from the Reserve Bank of India (RBI), Bandhan Bank officially began its operations by transferring BFSL’s entire microfinance portfolio into the newly formed bank. By 2017, BFSL ceased its microfinance operations and transitioned into a non-deposit-taking systemically important core investment company (NBFC-CIC-ND-SI), primarily focusing on investments.

Today, Bandhan Financial Holdings Limited (BFHL) operates as a wholly-owned subsidiary of BFSL, with the Group’s key entities including Bandhan Bank Ltd., Bandhan Mutual Fund, Bandhan Financial Services Ltd., and Bandhan Life. This diverse portfolio positions Bandhan as a formidable player in the financial sector.

Stock Performance: Bandhan Bank and BSE Sensex

As of 11:43 AM on Monday, Bandhan Bank’s shares were trading at ₹186.80 per share, slightly lower than their intraday high but still reflecting market confidence. Meanwhile, the BSE Sensex was also trading 0.10% lower at 81,610.47 levels, indicating a marginal overall dip in market sentiment.

Conclusion:

Bandhan Bank’s strong performance in Q2FY25 is a testament to its resilient business model and ability to scale operations effectively. Bandhan Bank share price, With a solid 21.4% growth in loans and a 27% increase in deposits, the bank is well-positioned for future growth. Although the CASA ratio saw a slight dip, the overall performance remains impressive, reflecting Bandhan Bank’s growing influence in India’s financial sector. The leadership continuity with Ratan Kumar Kesh further strengthens investor confidence, ensuring that the bank stays on course toward its long-term goals.

FAQs:

1.Why did Bandhan Bank’s share price rise?

A. The share price surged due to the bank’s strong Q2FY25 business updates, including a 21.4% growth in loans and a 27% increase in deposits.

2.How much did Bandhan Bank’s loans and advances grow?

A. Bandhan Bank’s loans and advances grew by 21.4% in Q2FY25, reaching ₹1.31 lakh crore.

3.What was the growth in Bandhan Bank’s total deposits?

A. Total deposits increased by over 27%, reaching ₹1.42 lakh crore in the September quarter of FY25.

4.What is CASA, and how did Bandhan Bank’s ratio perform?

A. CASA stands for Current Account Savings Account. The bank’s CASA ratio declined to 33.2% in Q2FY25, down from 38.5% in Q2FY24.

5.Who is currently serving as Bandhan Bank’s MD and CEO?

A. Ratan Kumar Kesh is the interim MD and CEO, with his term recently extended for another month, starting October 10, 2024.

6.What services does Bandhan Bank offer?

A. Bandhan Bank provides a wide range of banking services tailored for both microfinance and general banking needs, focusing on underbanked communities.

7.How did Bandhan Bank transition from a microfinance institution to a full-fledged bank?

A. Bandhan Bank originated as Bandhan Financial Services Pvt. Ltd. (BFSL) and became a commercial bank in 2015 after obtaining a banking license from the RBI.

8.What is Bandhan Financial Holdings Limited (BFHL)?

A. BFHL is a wholly-owned subsidiary of BFSL, overseeing investments and the Group’s financial services, including Bandhan Bank, Bandhan Mutual Fund, and Bandhan Life.