JA Bank aims to end FY26 with a ROA of 1%: CFO

Private lender YES Bank, which is on the recovery path, expects to end the current financial year with a return on assets of 1 percent, the bank’s Chief Financial Officer Niranjan Banodkar said.

Return on assets (ROA) is a profitability measure that measures how efficiently a bank uses its assets to generate profits. A higher ROA indicates better asset utilization and an increase in operating income.

“The bank will end the current fiscal year with an ROA of 1 percent and on an annualized basis, the ROA will cross 1 percent in the next fiscal year,” he told PTI.

For the December quarter, the bank reported a net profit of ₹952 crore, growing 55 percent year-on-year and 45 percent quarter-on-quarter.

The reported annualized return on assets (ROA) for the quarter improved further to 0.9 percent, from 0.6 percent in the previous quarter and the corresponding quarter last year.

The annualized reported ROA for nine months improved to 0.8 percent, compared to 0.5 percent for the nine months of the last financial year.

Last year, Japan’s Sumitomo Mitsui Banking Corporation (SMBC) acquired a 24.9 per cent stake in the bank for around ₹16,000 crore.

Following the acquisition, SMBC nominated Shinichiro Nishino and Rajeev V Kannan as non-executive non-independent directors to the bank’s board.

“We want to be a bank that can achieve a growth rate of around 15 per cent. With SMBC coming, there is clearly an opportunity for upside. Are we going to take growth to the next level or accelerate profitability… those are the nuances we will try to balance in the coming months,” Banodkar said.

He also said that a crucial part of improving the bank’s profitability is addressing the existing priority sector lending (PSL) shortages.

Since FY24, the bank has maintained 100 percent compliance across all PSL sub-categories, ensuring no additional burden is added to the Rural Infrastructure Development Fund (RIDF) shares.

As a result, he said, the bank’s RIDF balances have steadily declined from a peak of around 11 percent in FY24 to around 6.9 percent in the third quarter, and the bank remains on track to further reduce these to below 5 percent of total assets by FY27.

As these low-yielding RIDF assets mature, he says, the bank will systematically retire higher-cost loans while redeploying the funds into higher-yielding advances.

Published on February 22, 2026