Private sector lender YES Bank which is on the recovery path expects to close the ongoing financial year with a return on assets of 1 per cent, the bank’s Chief Financial Officer Niranjan Banodkar said.
Return on assets (ROA) is a profitability metric that measures how efficiently a bank uses its assets to generate profit. A higher ROA indicates better asset utilisation and an increase in the bottom line.
“The bank will exit the current fiscal year with an ROA of 1 per cent, and on an annual basis, the ROA will exceed 1 per cent in the next fiscal year,” he told PTI.
For the December quarter, the bank reported a net profit of ₹952 crore, registering a growth of 55 per cent on an annual basis and 45 per cent on a quarter-on-quarter basis.
The reported annualised return on assets (ROA) for the quarter further improved to 0.9 per cent against 0.6 per cent in the previous quarter as well as the corresponding quarter last year.
The annualised reported ROA for nine months has improved to 0.8 per cent against 0.5 per cent for 9 months of the last financial year.
Last year, Sumitomo Mitsui Banking Corporation (SMBC) of Japan acquired a 24.9 per cent stake in the bank for about ₹16,000 crore.
Following the acquisition, SMBC nominated Shinichiro Nishino and Rajeev V Kannan as Non-Executive Non-Independent Directors on the bank’s board.
“We want to be a bank that anchors around a 15 per cent growth rate. Clearly with SMBC coming in, there is an opportunity for an upside. Do we take growth higher or do we accelerate profitability… those are the nuances which we will try and balance in the next few months,” Banodkar said.
He also said that a critical component of the bank’s profitability improvement is the resolution of the legacy priority sector lending (PSL) shortfalls.
Since FY24, the bank has maintained a 100 per cent compliance across all PSL subcategories, ensuring that no incremental burden is added to the Rural Infrastructure Development Fund (RIDF) stock.
As a result, he said, the bank’s RIDF balances have continued their steady decline from a peak of about 11 per cent in FY24, to around 6.9 per cent in the third quarter, and the bank remains well on track to further reduce it to below 5 per cent of total assets by FY27.
As these low-yielding RIDF assets mature, he said, the bank would systematically retire higher-cost borrowings while redeploying funds into higher-yielding advances.
Published on February 22, 2026
