New Delhi, July 26 -- Punjab-based Capital Small Finance Bank has moved closer to meeting the eligibility criteria for applying for a universal banking license. Its net non-performing assets (NPAs) dropped to 1.14% in the June quarter, narrowing the gap on what management called the single remaining pending requirement before seeking an upgrade. However, the bank's board will decide on submitting the formal application only by FY29.

"From a tickbox perspective, we were left with one tickbox, that is a net NPA," Sarvjit Singh Samra, managing director and chief executive of Capital Small Finance Bank, told Mint, referring to the RBI's threshold of 1% or lower for the previous two fiscal years. He added that the metric has steadily improved...