Yes Bank Q1 FY25 Setback: Deposits, Loans Slide Despite Strong Liquidity — What’s the Big Worry?
Mumbai, July 2, 2025 — Yes Bank’s Q1 FY25 results are raising fresh concerns as the lender reported a decline in both deposits and loan book, despite having robust liquidity buffers.
The numbers have caught analysts and market observers by surprise, triggering fresh debate around the bank’s recovery narrative and retail confidence.
🧠 What’s Behind the Weak Performance?
Retail Deposit Erosion:
The bank’s retail deposit base is reportedly seeing leakages toward high-yield NBFC deposits and small finance banks.
Cautious Lending:
Yes Bank continues to tread carefully in unsecured and SME loans due to rising delinquency risks.
Competitive Pressure:
Larger private banks like HDFC Bank and ICICI are cornering quality borrowers with better rates and tech platforms.
Legacy Drag:
Despite the clean-up, Yes Bank still battles legacy NPAs, restricting aggressive credit growth.
📊 Vizzve Financials Insight: Banking Sector Pulse – FY25 Q1
In its latest filing, Vizzve Financials noted that Yes Bank is among the bottom 3 private banks in terms of QoQ loan-deposit growth.
❓ FAQ: Yes Bank’s Q1 FY25 Results
Q1: Why did Yes Bank's deposits decline?
Mostly due to intense competition from fintech-backed NBFCs and higher-yield deposit schemes elsewhere.
Q2: What does the low CASA ratio mean?
It signals fewer low-cost deposits. That affects profitability, especially in a rising interest rate environment.
Q3: Is Yes Bank in trouble again?
Not necessarily. Liquidity remains healthy, but growth is lagging, which raises medium-term red flags.
Q4: What does Vizzve say?
Vizzve maintains a “Hold” sentiment for risk-averse investors and flags Q2 as critical for directional clarity.
Q5: Should investors worry?
Short-term volatility is expected, but long-term investors should wait for Q2 data and RBI commentary.
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Published on July 4, 2025 • By Benny
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