This followed a fresh calculation by the state-run lender that pegged the ECL impact at Rs 3,000-3,500 crore, lower than Rs 4,000-6,000 crore estimated previously, he said.
“We will not need to raise capital as the ECL impact would be in the range of Rs 3,000 to Rs 3,500 crore; out of this, we have already made a floating provision of Rs 1,000 crore,” Kumar told ET after the bank’s quarterly earnings.
“Going forward, I think we will be able to provide another Rs 1,000 crore. So, there is no need to go for QIP,” he said.
The bank has an enabling approval from its board to raise up to Rs 5,000 crore this fiscal year. It was planning a qualified institutional placement (QIP) of Rs 2,500 crore with an equal-sized greenshoe option.
Kumar said Indian Bank is comfortably placed in terms of growth capital, with the capital adequacy ratio at 17.58% at the end of June, though falling slightly from 17.93% in the three months prior.
The Chennai-headquartered lender posted a 10% year-on-year rise in fiscal first quarter net profit at Rs 3,273 crore compared to Rs 2,973 crore a year earlier, backed by a 17% increase in net interest income at Rs 7,435 crore. Net interest margin for the quarter improved to 3.29% from 3.23% a year earlier.Operating profit rose 16.5% at Rs 5,557 crore.
“We are very happy that about 51% of our branches this time met the business target despite the geopolitical headwinds,” said Kumar. “Typically, this ratio used to hover around 25-30%.”
He highlighted that several initiatives taken by the bank in the last few quarters have started yielding results. For instance, the bank’s virtual banking experience (VBX), a digital-first initiative unveiled in July 2025, generated Rs 98,000 crore of business.
“We have also started generating leads from the call centre and converting those into business,” he said. “The next generation call centre is no more merely a distress resolution centre.”
The bank’s gross advances expanded by 13.9% year-on-year to Rs 6.84 lakh crore at the end of June, while deposits grew 13.5% to Rs 8.45 lakh crore. Gross non-performing assets ratio improved to 1.86% from 3.01% a year prior.