Slice Small Finance Bank (SSFB), established following the merger of fintech Slice and North East Small Finance Bank, has announced its first profitable outcome since the merger. The lender achieved a net profit of Rs 7 crore in the initial half of FY26, a significant recovery from a loss of Rs 217 crore in FY25 and Rs 153 crore in FY24, according to CRISIL’s most recent rating report. During the period from April to September 2025, the pre-ESOP profit for SSFB was recorded at Rs 43 crore, of which Rs 36.5 crore was allocated to the employee stock option reserve. CRISIL highlighted that the financial performance of the bank exceeded expectations, supported by an annualised net interest margin of 11.1% and credit costs of 2.4%, despite a slight increase in funding costs due to the inherited high-cost borrowings from Slice.
According to the report, the assets under management (AUM) of the bank surged to Rs 3,759 crore as of September 2025, up from Rs 2,954 crore in March 2025, indicating rapid expansion post-merger which became effective in October 2024. The portfolio continued to be dominated by digital unsecured personal loans, comprising around 76% of AUM, followed by MSME loans at 14% and other lending segments. Deposits also experienced significant growth, rising by 61% in H1 FY26 to Rs 3,896 crore, with a robust CASA ratio of 27.5%, an increase from Rs 2,418 crore at the end of FY25.
In line with the enhanced performance, CRISIL has updated its outlook on the bank’s Lower Tier-II bonds from ‘Stable’ to ‘Positive’ while maintaining a rating of BBB-. The agency stated that the outlook adjustment reflects SSFB’s strengthening market position, improved profitability, and sufficient capitalisation. As of September 2025, the capital adequacy ratio of the lender was at 18.1%, supported by a net worth of Rs 891 crore, compared to Rs 849 crore in March 2025.
Although asset quality remains at a reasonable level, its gross NPAs fell to 5.8% and net NPAs to 4.2%, a decrease from 6.3% and 4.7% in FY25. CRISIL has indicated that the bank’s capacity to maintain profitability and stable asset quality while expanding its operations will be crucial for future ratings.
