Federal Bank's 2QFY16 result was way below our and street estimates due to sharp increase in fresh slippages during the quarter along with substantial increase in C/I ratio. Total fresh slippages in 2QFY16 stood at Rs4.1bn (slippage ratio of 3.3%) v/s Rs3.2bn in 1QFY16 and Rs1.8bn in 2QFY15. Higher slippages were owing to the increased slippages from SME and corporate loan portfolio. C/I ratio also deteriorated to 57.4% v/s 54% in 1QFY16 and 48.9% in 2QFY15 due to considerably higher growth in opex as compared to operating income. Business growth remained subdued on YTD basis owing to decline in corporate and agri...