YES Bank's Strategic Growth Path: ROA, Profitability, and Compliance

YES Bank, a private sector entity on the mend, anticipates concluding this financial year with a promising 1% return on assets (ROA), per Chief Financial Officer Niranjan Banodkar. ROA serves as a crucial profitability indicator, reflecting asset efficiency in profit generation. Improved asset utilization often signals a healthier bottom line.

In the December quarter, the bank's reported net profit soared to Rs 952 crore—a 55% annual growth. The annualised ROA climbed to 0.9% from the previous term’s 0.6%, showing continued financial improvement. The bank's profitability has been bolstered after Japan's Sumitomo Mitsui Banking Corporation (SMBC) acquired nearly a quarter stake, paving the way for strategic opportunities.

Moreover, YES Bank has mitigated legacy priority sector lending shortfalls, maintaining full compliance across all categories since FY24. This progress has steadily reduced the Rural Infrastructure Development Fund (RIDF) balances, which are expected to fall below 5% of total assets by FY27, enabling the bank to optimize its financial strategies further.