Banks Q1 loan growth remain strong, share of low cost deposits falls

Mid-sized and smaller private sector lenders reported robust loan growth in Q1 FY25, though low-cost deposits declined. Federal Bank saw a 20.1% year-on-year increase in gross advances to Rs 2.24 trillion, while Yes Bank reported a 14.8% growth to Rs 2.3 trillion. Sequentially, Federal Bank's advances grew 5.4% and Yes Bank's 0.9%. Both banks experienced a slight drop in their CASA ratios. Yes Bank's credit-to-deposit ratio rose to 86.8% by end-June from 85.5% in March.