Deposit growth and funding composition
YES Bank’s deposits grew 19.5% from a year earlier at September’s close, while the current and savings account share fell from 33.7% to 30%. The Indian private lender is expanding its balance sheet with a changing mix of customer funding. Total deposits reached 354,084 crore rupees and the two account categories totalled 106,255 crore rupees. A crore equals 10 million rupees. Volume growth is visible; the quality of that expansion depends on how the funding franchise changes alongside it.[1]
Loans increased 23.8% annually to 309,675 crore rupees. Quarterly growth was 8.6% for loans and 12.3% for deposits. The credit-to-deposit ratio fell from 90.4% at June’s close to 87.5%. Deposits growing faster than loans during the quarter expand the lender’s funding room when measured through total balances. Turning that ratio into a profit-margin assessment also requires deposit costs and loan yields in the model.[1]
The foreign-currency channel changes the growth rate
The bank separately excludes foreign-currency deposits raised through the Reserve Bank of India’s concessional dollar/rupee swap facility and the associated foreign-currency loans. After that adjustment, quarterly loan growth is 3.3% and deposit growth is 6.5%. The two sets of growth measures cover the same company and period but different balances. Part of the reported volume expansion comes through a specific foreign-currency funding channel; normalized growth describes expansion outside that channel.[1]
The adjusted credit-to-deposit ratio is 83.2%. Removing foreign-currency deposits together with related loans changes both the numerator and denominator. September and June balances are adjusted for the arrangement, while the previous September figures remain unchanged. Evaluating management’s growth narrative depends on comparing consistent definitions of loans and deposits. Treating the contribution from a specific channel as recurring customer acquisition assigns a different economic meaning to the same headline growth rate.[1]
Cost sensitivity sits in the account mix
Current and savings deposits rose from 103,233 crore rupees at June’s close to 106,255 crore rupees. Their share nevertheless fell from 32.7% to 30%. Excluding the specified foreign-currency effect, the share also declined, from 32.8% to 31.7%. Certificates of deposit increased from 6,604 crore rupees to 11,382 crore rupees. Attributing the entire mix shift to the foreign-currency channel therefore leaves out the movement in the adjusted customer-account measure, which points in the same direction.[1]
The relevant sensitivity is cost: if other deposit categories carry higher interest rates, a declining current and savings share may increase overall funding costs. An alternative explanation could be a strong deposit campaign temporarily expanding balances and lending capacity. The distribution of balances alone leaves the relative profit effect of those explanations unresolved. YES Bank’s funding mix changes even after the foreign-currency adjustment; the company-economics link is the relationship between that mix and the interest paid to obtain it.[1]