RBL Bank will remain cautious on the unsecured lending segment “with a clear focus on quality over quantity” due to macro uncertainties and high household leverage, said CEO Subramaniakumar.
As a bank, we have consistently aimed to reduce our unsecured lending exposure over a three-to-five-year horizon, he said.
"The past 12 months presented challenges in managing this segment, but our profits and reserves from other business lines have allowed us to absorb these pressures and strengthen our provisions, paving the way for FY26 with a sharper focus on quality over quantity," he said.
We remain confident that unsecured lending will retain its relevance but at a significantly lower proportion compared to three years ago, particularly when looking three years ahead, he added.
On the other hand, he projected strong growth in secured retail lending at 25-30 percent for FY26, driven by improved execution and branch-led sourcing, particularly in mortgages and business banking group (BBG).
He also said, the bank anticipates wholesale lending growth of 10-12 percent, up from 6 percent in FY25, supported by ample headroom and a sharper go-to-market strategy.
The bank’s Microfinance (MFI) portfolio, he said, now at 6.2 percent, is expected to stabilise in FY26 with collection efficiency returning to pre-migration levels, reducing the need for significant additional provisions.
The bank will also focus on granular deposit growth (projected at 20-25 percent year-on-year), cross-selling through branches, and reducing its cost-to-income ratio, which dropped from 66 percent to 64 percent in FY25, targeting a 2-3 percent annual reduction.
RBL Bank on Friday reported an 81 percent decline in its net profit to Rs 69 crore for the fourth quarter of FY25.
The lender had earned a net profit of Rs 353 crore in the year-ago period.
During the quarter, the bank's total income increased to Rs 4,476 crore as against Rs 4,215 crore a year ago, RBL Bank said in a regulatory filing.
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