Indian banks' dividends to shrink 4% in FY26: S&P Global
Indian banks are set to shrink their dividend payouts by 4.2% to $5.98 billion for the financial year ending March 2026, according to S&P Global Market Intelligence.
This comes right after a big 15% jump last year and marks the first drop in a while, mainly thanks to slower loan growth and tighter profit margins.
HDFC Bank, Bank of Baroda likely to cut payouts
HDFC Bank's dividend per share is expected to dip from ₹11 in FY25 down to ₹8.25 in FY26, while Bank of Baroda could see its payout fall slightly from ₹8.35 to ₹7.90, according to S&P Global Market Intelligence.
Meanwhile, State Bank of India (SBI) looks set to keep its dividend steady at around ₹16 per share, and ICICI Bank stands out with a likely increase from ₹11 in FY25 up to ₹12 per share next year.
Repo rate cut by RBI in early 2025
A big reason is the Reserve Bank of India's repo rate cut by 100 basis points in early 2025, which squeezed bank profits—loan rates dropped but deposit costs stayed high—making it tougher for banks to earn more or hand out bigger dividends this time around.