Federal Bank's net profit fell 14.6% in Q2 2025 due to higher provisions, despite improved asset quality.

Federal Bank, India's sixth-largest private lender, saw its net profit drop 14.6% to Rs 861.8 crore in the quarter ending June 2025, due to a significant rise in provisions, especially in agriculture and microfinance. Despite this, the bank's asset quality improved, with the gross NPA ratio falling to 1.91%. The loan book expanded by 9.2%, and the capital adequacy ratio increased to 16.03%.