Shares of Federal Bank Ltd. fell as much as 7% on Tuesday, January 28, post its December quarter results that were reported after market hours on Monday.

On a sequential basis, the lender’s business momentum was at the lowest level in 14 quarters. Deposits were down 1% from the previous quarter, while advances were flat.

Credit-Deposit ratio was the highest in 28 quarters at 86.5% from 85.6% in the September quarter.

However, asset quality for the private lender saw an improvement with gross NPA falling to the lowest level in nearly a decade at 1.95% from 2.09% in the September quarter.

Provisions more than tripled from last year to ₹292.3 crore, a number that was up 85% on a quarter-on-quarter basis.

In an interaction with CNBC-TV18, Federal Bank’s management said that provisions are elevated for certain portion of their book, which is the unsecured loans.

The lender also said that it will not grow its personal loans and microfinance loans over the next two quarters.

Brokerage firm UBS has maintained its “buy” rating on the stock but has cut its price target to ₹235.

UBS has cut its loan growth estimates for Federal Bank by 200 – 300 basis points, its Net Interest Margin (NIM) estimate by two basis points to eight basis points, while credit cost estimates are raised by five basis points.

Out of the 42 analysts that have coverage on Federal Bank, 35 of them have a “buy” rating on the stock, five of them say “hold”, while two of them have a “sell” rating on the stock.

Shares of Federal Bank are down 5.6% at ₹180.5. The stock is down 17% from its recent peak of ₹217.