Page 5 - Banking Finance February 2026

BANK UPDATE

statutory requirements. The deposited
amount earns interest during the in-
terim period, offering both regulatory
B B B B Baa aa ann nn nkk kk kii ii inn nn ngg gg g The bank said the product is aimed at
protection and financial returns.

helping customers avoid rushed rein-
vestment decisions while remaining
tax-compliant, providing a structured
News and secure mechanism for managing
capital gains until long-term invest-
ment plans are finalised.

Fino outlines secured
lending focus ahead of
Central Bank of India reports strong credit growth in
small finance bank transi-
Q3 FY26
tion
Central Bank of India posted a robust performance in the third quarter ended
December 31, 2025, with gross advances rising 19.57 per cent year-on-year Fino Payments Bank plans to expand
and total deposits growing 13.23 per cent, according to provisional regula- into secured lending through its exten-
tory filings. sive merchant network once it com-
pletes its transition into a small finance
As of December-end 2025, the bank's deposits stood at Rs. 4,50,536 crore, bank, according to Managing Director
while gross advances reached Rs. 3,23,773 crore. The strong credit expan- and CEO Rishi Gupta. The bank re-
sion outpaced deposit growth, leading to an improvement in the credit-de-
ceived in-principle approval from the
posit ratio to 72.06 per cent, compared with 68.25 per cent a year earlier.
Reserve Bank of India in early Decem-
However, the CASA ratio moderated to 47.12 per cent from 49.18 per cent ber 2025 for conversion into a small fi-
in December 2024, reflecting a shift in deposit mix amid competitive pricing nance bank, enabling it to undertake
conditions. Despite this, overall business momentum remained firm. lending activities after restructuring.
Total business, comprising deposits and advances, increased 15.80 per cent Gupta said Fino intends to hive off its
year-on-year to Rs. 7,74,309 crore as at December-end 2025, underlining business correspondent (BC) arm and
sustained lending demand and balance sheet expansion during the quarter. adopt a transaction-led, digital-first
banking model, distinguishing it from
most small finance banks that evolved
Karur Vysya Bank launches viduals and Hindu Undivided Families from microfinance institutions. With
(HUFs) who have realised capital gains
Capital Gains Account from the sale of assets such as prop- over 20 lakh merchants and 1.6 crore
Scheme erty, land or securities. Under the In- customers, including 60 lakh active UPI
users, the bank plans to layer deposit
Karur Vysya Bank (KVB) has launched come Tax Act, 1961, capital gains can and loan products onto existing pay-
its Capital Gains Account Scheme be exempt from tax if reinvested within ment relationships.
(CGAS) after receiving authorisation a prescribed period. However, practi-
from the Ministry of Finance, Govern- cal delays in identifying suitable invest- Fino currently holds deposits exceeding
ment of India. The facility is available ment avenues often extend beyond tax Rs. 3,000 crore at a cost of under 2
with immediate effect across KVB's filing deadlines. per cent. It expects to mobilise Rs.
branch network, excluding rural KVB's CGAS allows taxpayers to park 600-800 crore annually to build a
branches. their capital gains in a designated ac- stable CASA base, supporting lower
The Capital Gains Account is a count, thereby preserving eligibility for funding costs and scalable secured
specialised deposit product for indi- tax exemptions while complying with lending operations.

BANKING FINANCE | FEBRUARY | 2026 | 5