Bandhan Bank Share Price Slides 15% After Lender Lowers RoA Outlook

Bandhan Bank share price declined as much as 15% in early trade on Wednesday after the private sector lender revised its medium-term return on assets (RoA) guidance, despite reporting stronger quarterly earnings. Investors reacted to the bank’s expectation of softer net interest margins (NIMs) and higher operating costs over the coming quarters.

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At 10:20 am, the Bandhan Bank share price was trading at ₹177.50, down 15% from the previous close.

RoA Guidance Revised Lower

Speaking during the post-results analyst conference call, Managing Director and Chief Executive Officer Partha Pratim Sengupta said the bank now expects its RoA to average between 1.2% and 1.4% by the end of FY27. This is lower than its earlier target of 1.6% to 1.8%.

Sengupta attributed the revised guidance to external factors affecting the banking sector, including higher funding costs and increased technology-related expenditure. He added that the bank’s long-term strategic objective remains unchanged, although achieving the targeted RoA may now take longer than initially planned.

The management also indicated that NIMs are expected to remain under pressure over the next two quarters, contributing to the revised profitability outlook.

Quarterly Earnings Beat Estimates

Bandhan Bank reported a net profit of ₹502 crore for the April-June quarter of FY27, up 35% from ₹372 crore recorded in the corresponding period last year.

The net interest income (NII) rose by 5.9% in terms of yearly growth from ₹2,757 crore to ₹2,921 crore, while the net total income showed a rise of 1.2% in yearly terms from ₹3,483 crore to ₹3,524 crore.

Gross advances were recorded at ₹1,55,555 crore for the period ending June 2026. This is an increase of 16.4% from ₹1,33,625 crore the previous year. On an annual basis, the retail loan portfolio, except housing, has risen 45%, wholesale banking gross advances have risen 38%, and housing loans have grown 6%.

Asset Quality Improves

The bank reported an improvement in asset quality during the quarter. Gross non-performing assets (GNPA) declined to 3.1% from 3.3% in the previous quarter, while net NPA improved to 0.9% from 1%.

Compared with the same period last year, GNPA improved by 182 basis points and net NPA by 43 basis points.

The provision coverage ratio, including technical write-offs, stood at 85.9% as of June 30, 2026.

Provisions and contingencies, excluding tax, declined 40% year-on-year to ₹683 crore. The capital adequacy ratio stood at 18.2%, compared with 19.4% a year earlier. The bank reported a quarterly RoA of 1% and return on equity of 7.7%.

Board Approves Interim CFO Appointment

The bank’s board also approved the appointment of Vinay Jain as interim Chief Financial Officer from September 26, 2026, until March 31, 2027, following the resignation of Rajeev Mantri.

While the quarterly financial performance remained stronger than the previous year, the revised profitability outlook kept the Bandhan Bank share price under pressure as investors assessed the impact of lower NIMs and higher operating expenses on the lender’s earnings trajectory.