Bandhan Bank’s corporate loan book has overtaken its microfinance portfolio, marking a strategic shift by the private lender to reduce dependence on its unsecured lending segment.
The bank’s wholesale loans have grown to Rs 56,000 crore, surpassing its microfinance loans, which stood at Rs 55,000 crore. The shift comes as the lender accelerates its efforts to de-risk its loan portfolio following stress in the microfinance sector.
Bandhan Bank plans to increase the share of secured assets to 60% of its overall loan book, up from 56% as of March 31, 2026, with corporate lending emerging as a key growth driver.
“The wholesale book has overtaken our microfinance loans and we are going to continue with this growth trend. Our plan is to expand the secured lending book first to 58% in FY27 and then to 60% of the bank’s loan portfolio while bringing down the unsecured segment to 40%,” said a senior Bandhan Bank executive who did not wish to be named.
Corporate Banking Expansion
As part of the strategy, the Kolkata-based lender is expanding its specialised corporate banking network. After opening its first such branch at Mumbai’s Bandra Kurla Complex recently, the bank plans to launch similar branches in Delhi and southern states where it sees growth opportunities.
“These branches will cater to corporate and institutional clients and undertake loans of Rs 50 crore and above. They will also provide structured finance and sector-specific advisory services,” the executive added.
The bank’s wholesale banking segment now contributes nearly one-third of its total loan book. The largest corporate loan exposure stands at Rs 900 crore, while the average ticket size for corporate customers is around Rs 200 crore.
The lender is focusing on sectors such as iron and steel, roads and renewable energy, while avoiding segments such as aviation and telecom.
Margin Pressures
However, the shift towards secured lending could put pressure on net interest margins (NIMs), as unsecured loans typically generate higher yields. Bandhan Bank’s annualised NIM declined to 6.1% in FY26 from 7.1% a year earlier.
To support margins, the bank is looking to reduce its dependence on bulk deposits and improve its liability profile.
The lender had undertaken a balance sheet clean-up exercise last year after stress emerged in the microfinance portfolio. It sold non-performing assets worth Rs 3,212 crore and written-off loans worth Rs 3,719 crore to asset reconstruction companies.
The bank is also preparing to launch credit card and wealth management services as it looks to diversify its business lines.