+91-22-48913909Best Banking Mutual Funds 2026
Since 2016 banking funds are catching the eye of investors. After underperforming in 2015, banking sector funds performed strongly in last two years. In the year 2017, banking, funds have given 31 percent returns. With such good performance, many investors are inclining towards Investing in these schemes.
Banking funds are those Mutual Funds that invest the majority of their funds in the Banking and Financial Services sector. It is basically a sector Equity Fund. But, one should know that sector funds can outperform the broader market by a big margin when the economic and market conditions are favourable for the sector. At the same time, sector funds can underperform considerably when the market conditions are unfavourable. It is always advised to the investors that they should avoid these funds unless the timing of entry is suitable.
Why Invest in Banking Mutual Funds?
Ideally, banking funds are considered as a good option over a long investment horizon, across different market conditions. Over the last five years, these funds gave average annualized returns of more than 17 percent. So, even though these funds shouldn't be the only fund on your Portfolio, you can add banking funds to your portfolio to get exposure to one of the fastest growing sectors of the Indian economy.
As banking and finance sector is considered to be the country’s one of the backbone, it may result in the development of the country, especially in the case where the government is also supporting the sector. So, it can be assumed that in the future this can be a win-win situation for investors if they get any opportunity to participate in this fund. However, a risk-averse investor should avoid investing in such high risk sectors or funds.
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Fund Selection Methodology used to find 4 funds
Best Banking Sector Mutual Funds FY 26 - 27
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 5 YR (%) 2024 (%) UTI Banking and Financial Services Fund Growth ₹190.161
↓ -1.03 ₹1,213 -2.6 -3.3 2.3 15 13.8 16.3 ICICI Prudential Banking and Financial Services Fund Growth ₹129.16
↓ -0.97 ₹9,367 -3.5 -5.9 -0.2 13.1 13.3 15.9 Nippon India Banking Fund Growth ₹632.531
↓ -5.54 ₹6,721 -1.7 -2.6 2.5 16.6 17.8 17.4 TATA Banking and Financial Services Fund Growth ₹43.1129
↓ -0.28 ₹2,743 -1.4 -3.4 1.9 15.5 13.8 17.5 Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 24 Apr 26 Research Highlights & Commentary of 4 Funds showcased
Commentary UTI Banking and Financial Services Fund ICICI Prudential Banking and Financial Services Fund Nippon India Banking Fund TATA Banking and Financial Services Fund Point 1 Bottom quartile AUM (₹1,213 Cr). Highest AUM (₹9,367 Cr). Upper mid AUM (₹6,721 Cr). Lower mid AUM (₹2,743 Cr). Point 2 Oldest track record among peers (22 yrs). Established history (17+ yrs). Established history (22+ yrs). Established history (10+ yrs). Point 3 Rating: 3★ (upper mid). Top rated. Rating: 3★ (lower mid). Not Rated. Point 4 Risk profile: High. Risk profile: High. Risk profile: High. Risk profile: High. Point 5 5Y return: 13.76% (lower mid). 5Y return: 13.30% (bottom quartile). 5Y return: 17.79% (top quartile). 5Y return: 13.84% (upper mid). Point 6 3Y return: 14.97% (lower mid). 3Y return: 13.12% (bottom quartile). 3Y return: 16.64% (top quartile). 3Y return: 15.49% (upper mid). Point 7 1Y return: 2.29% (upper mid). 1Y return: -0.23% (bottom quartile). 1Y return: 2.52% (top quartile). 1Y return: 1.91% (lower mid). Point 8 Alpha: 3.14 (lower mid). Alpha: -0.18 (bottom quartile). Alpha: 3.70 (upper mid). Alpha: 3.81 (top quartile). Point 9 Sharpe: -0.32 (lower mid). Sharpe: -0.49 (bottom quartile). Sharpe: -0.29 (upper mid). Sharpe: -0.29 (top quartile). Point 10 Information ratio: 0.39 (lower mid). Information ratio: 0.08 (bottom quartile). Information ratio: 0.73 (top quartile). Information ratio: 0.45 (upper mid). UTI Banking and Financial Services Fund
ICICI Prudential Banking and Financial Services Fund
Nippon India Banking Fund
TATA Banking and Financial Services Fund
*above is the list of top Banking & Financial Services mutual funds having AUM/Net Assets higher than 500 Crore.
(Erstwhile UTI Banking Sector Fund) Investment objective is "capital appreciation" through investments in the stocks of the companies/institutions engaged in the banking and financial services activities. Below is the key information for UTI Banking and Financial Services Fund Returns up to 1 year are on ICICI Prudential Banking and Financial Services Fund is an Open-ended equity scheme that seeks to generate long-term capital appreciation to unitholders from a portfolio that is invested predominantly in equity and equity related securities of companies engaged in banking and financial services. However, there can be no assurance that the investment objective of the Scheme will be realized. Research Highlights for ICICI Prudential Banking and Financial Services Fund Below is the key information for ICICI Prudential Banking and Financial Services Fund Returns up to 1 year are on The primary investment objective of the Scheme is to seek to generate continuous returns by actively investing in equity and equity related securities of
companies in the Banking Sector and companies engaged in allied activities related to Banking Sector. The AMC will have the discretion to completely or
partially invest in any of the type of securities stated above with a view to maximize the returns or on defensive considerations. However, there can be no
assurance that the investment objective of the Scheme will be realized, as actual market movements may be at variance with anticipated trends. Research Highlights for Nippon India Banking Fund Below is the key information for Nippon India Banking Fund Returns up to 1 year are on The investment objective of the scheme is to seek long term capital appreciation by investing atleast 80% of its net assets in equity/equity related instruments of the companies in the Banking and Financial Services sector in India. Research Highlights for TATA Banking and Financial Services Fund Below is the key information for TATA Banking and Financial Services Fund Returns up to 1 year are on 1. UTI Banking and Financial Services Fund
UTI Banking and Financial Services Fund
Growth Launch Date 7 Apr 04 NAV (24 Apr 26) ₹190.161 ↓ -1.03 (-0.54 %) Net Assets (Cr) ₹1,213 on 31 Mar 26 Category Equity - Sectoral AMC UTI Asset Management Company Ltd Rating ☆☆☆ Risk High Expense Ratio 2.2 Sharpe Ratio -0.32 Information Ratio 0.39 Alpha Ratio 3.14 Min Investment 5,000 Min SIP Investment 500 Exit Load 0-1 Years (1%),1 Years and above(NIL) Growth of 10,000 investment over the years.
Date Value 31 Mar 21 ₹10,000 31 Mar 22 ₹10,872 31 Mar 23 ₹11,714 31 Mar 24 ₹14,838 31 Mar 25 ₹17,023 31 Mar 26 ₹16,655 Returns for UTI Banking and Financial Services Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Apr 26 Duration Returns 1 Month 6.9% 3 Month -2.6% 6 Month -3.3% 1 Year 2.3% 3 Year 15% 5 Year 13.8% 10 Year 15 Year Since launch 14.3% Historical performance (Yearly) on absolute basis
Year Returns 2024 16.3% 2023 11.1% 2022 19.5% 2021 15.1% 2020 14.3% 2019 -5.3% 2018 11.6% 2017 -6.8% 2016 43.5% 2015 13% Fund Manager information for UTI Banking and Financial Services Fund
Name Since Tenure Amit Premchandani 16 Jun 25 0.79 Yr. Bhavesh Kanani 12 Jan 26 0.22 Yr. Data below for UTI Banking and Financial Services Fund as on 31 Mar 26
Equity Sector Allocation
Sector Value Financial Services 95.26% Technology 0.95% Asset Allocation
Asset Class Value Cash 3.79% Equity 96.21% Other 0% Top Securities Holdings / Portfolio
Name Holding Value Quantity ICICI Bank Ltd (Financial Services)
Equity, Since 30 Apr 04 | ICICIBANK14% ₹175 Cr 1,455,000
↑ 30,000 HDFC Bank Ltd (Financial Services)
Equity, Since 31 Mar 09 | HDFCBANK14% ₹165 Cr 2,250,000 Axis Bank Ltd (Financial Services)
Equity, Since 30 Jun 18 | 53221511% ₹129 Cr 1,110,000 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 30 Sep 18 | KOTAKBANK9% ₹115 Cr 3,250,000 Bajaj Finance Ltd (Financial Services)
Equity, Since 30 Nov 19 | 5000346% ₹72 Cr 895,000
↑ 85,000 State Bank of India (Financial Services)
Equity, Since 28 Feb 18 | SBIN5% ₹59 Cr 600,000
↓ -250,000 Shriram Finance Ltd (Financial Services)
Equity, Since 31 Jan 24 | SHRIRAMFIN5% ₹58 Cr 662,975
↑ 162,975 Bajaj Finserv Ltd (Financial Services)
Equity, Since 31 Aug 24 | 5329783% ₹40 Cr 246,000
↑ 162,000 Multi Commodity Exchange of India Ltd (Financial Services)
Equity, Since 31 Mar 24 | MCX3% ₹36 Cr 150,000 Ujjivan Small Finance Bank Ltd Ordinary Shares (Financial Services)
Equity, Since 30 Apr 25 | UJJIVANSFB3% ₹33 Cr 6,534,317 2. ICICI Prudential Banking and Financial Services Fund
ICICI Prudential Banking and Financial Services Fund
Growth Launch Date 22 Aug 08 NAV (24 Apr 26) ₹129.16 ↓ -0.97 (-0.75 %) Net Assets (Cr) ₹9,367 on 31 Mar 26 Category Equity - Sectoral AMC ICICI Prudential Asset Management Company Limited Rating ☆☆☆☆☆ Risk High Expense Ratio 1.83 Sharpe Ratio -0.49 Information Ratio 0.08 Alpha Ratio -0.18 Min Investment 5,000 Min SIP Investment 100 Exit Load 0-1 Years (1%),1 Years and above(NIL) Growth of 10,000 investment over the years.
Date Value 31 Mar 21 ₹10,000 31 Mar 22 ₹11,243 31 Mar 23 ₹11,980 31 Mar 24 ₹14,939 31 Mar 25 ₹17,064 31 Mar 26 ₹16,241 Returns for ICICI Prudential Banking and Financial Services Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Apr 26 Duration Returns 1 Month 6.9% 3 Month -3.5% 6 Month -5.9% 1 Year -0.2% 3 Year 13.1% 5 Year 13.3% 10 Year 15 Year Since launch 15.6% Historical performance (Yearly) on absolute basis
Year Returns 2024 15.9% 2023 11.6% 2022 17.9% 2021 11.9% 2020 23.5% 2019 -5.5% 2018 14.5% 2017 -0.4% 2016 45.1% 2015 21.1% Fund Manager information for ICICI Prudential Banking and Financial Services Fund
Name Since Tenure Roshan Chutkey 29 Jan 18 8.18 Yr. Sharmila D'Silva 30 Jun 22 3.76 Yr. Antariksha Banerjee 2 Mar 26 0.08 Yr. Data below for ICICI Prudential Banking and Financial Services Fund as on 31 Mar 26
Equity Sector Allocation
Sector Value Financial Services 95.9% Health Care 0.93% Industrials 0.29% Technology 0.26% Asset Allocation
Asset Class Value Cash 2.52% Equity 97.48% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 31 Oct 08 | HDFCBANK16% ₹1,477 Cr 20,194,031 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Oct 08 | ICICIBANK14% ₹1,338 Cr 11,094,643 Axis Bank Ltd (Financial Services)
Equity, Since 28 Feb 19 | 5322159% ₹873 Cr 7,518,679
↑ 985,000 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Jan 23 | KOTAKBANK6% ₹564 Cr 15,957,386
↑ 2,853,989 SBI Life Insurance Co Ltd (Financial Services)
Equity, Since 30 Sep 17 | SBILIFE5% ₹477 Cr 2,685,881
↓ -550,534 State Bank of India (Financial Services)
Equity, Since 31 Oct 08 | SBIN5% ₹429 Cr 4,384,950
↑ 450,000 LIC Housing Finance Ltd (Financial Services)
Equity, Since 30 Nov 24 | LICHSGFIN4% ₹337 Cr 6,799,870 HDFC Life Insurance Co Ltd (Financial Services)
Equity, Since 30 Sep 23 | HDFCLIFE3% ₹310 Cr 5,241,538 SBI Cards and Payment Services Ltd Ordinary Shares (Financial Services)
Equity, Since 30 Nov 25 | SBICARD3% ₹305 Cr 4,799,326
↓ -209,984 ICICI Lombard General Insurance Co Ltd (Financial Services)
Equity, Since 30 Sep 19 | ICICIGI3% ₹305 Cr 1,782,062
↓ -18,266 3. Nippon India Banking Fund
Nippon India Banking Fund
Growth Launch Date 26 May 03 NAV (24 Apr 26) ₹632.531 ↓ -5.54 (-0.87 %) Net Assets (Cr) ₹6,721 on 31 Mar 26 Category Equity - Sectoral AMC Nippon Life Asset Management Ltd. Rating ☆☆☆ Risk High Expense Ratio 1.89 Sharpe Ratio -0.3 Information Ratio 0.73 Alpha Ratio 3.7 Min Investment 5,000 Min SIP Investment 100 Exit Load 0-1 Years (1%),1 Years and above(NIL) Growth of 10,000 investment over the years.
Date Value 31 Mar 21 ₹10,000 31 Mar 22 ₹12,185 31 Mar 23 ₹13,188 31 Mar 24 ₹17,650 31 Mar 25 ₹19,858 31 Mar 26 ₹19,458 Returns for Nippon India Banking Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Apr 26 Duration Returns 1 Month 7.9% 3 Month -1.7% 6 Month -2.6% 1 Year 2.5% 3 Year 16.6% 5 Year 17.8% 10 Year 15 Year Since launch 19.8% Historical performance (Yearly) on absolute basis
Year Returns 2024 17.4% 2023 10.3% 2022 24.2% 2021 20.7% 2020 29.7% 2019 -10.6% 2018 10.7% 2017 -1.2% 2016 44.1% 2015 11.5% Fund Manager information for Nippon India Banking Fund
Name Since Tenure Vinay Sharma 9 Apr 18 7.98 Yr. Kinjal Desai 25 May 18 7.86 Yr. Bhavik Dave 18 Jun 21 4.79 Yr. Amber Singhania 11 Mar 26 0.06 Yr. Data below for Nippon India Banking Fund as on 31 Mar 26
Equity Sector Allocation
Sector Value Financial Services 95.94% Technology 2.64% Asset Allocation
Asset Class Value Cash 1.42% Equity 98.58% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 31 Jul 08 | HDFCBANK14% ₹923 Cr 12,619,320 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Oct 09 | ICICIBANK14% ₹909 Cr 7,538,887
↑ 100,000 Axis Bank Ltd (Financial Services)
Equity, Since 30 Jun 17 | 53221510% ₹647 Cr 5,571,983 State Bank of India (Financial Services)
Equity, Since 31 Mar 14 | SBIN6% ₹408 Cr 4,165,352
↓ -100,000 SBI Cards and Payment Services Ltd Ordinary Shares (Financial Services)
Equity, Since 31 Jul 20 | SBICARD4% ₹247 Cr 3,893,792 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 Jul 23 | KOTAKBANK4% ₹243 Cr 6,872,870
↑ 1,000,000 SBI Life Insurance Co Ltd (Financial Services)
Equity, Since 30 Nov 20 | SBILIFE4% ₹240 Cr 1,350,199 Bajaj Finserv Ltd (Financial Services)
Equity, Since 31 Oct 23 | 5329783% ₹208 Cr 1,275,773 Cholamandalam Financial Holdings Ltd (Financial Services)
Equity, Since 30 Apr 19 | CHOLAHLDNG3% ₹186 Cr 1,362,903
↑ 169,754 ICICI Prudential Asset Management Co Ltd (Financial Services)
Equity, Since 31 Dec 25 | ICICIAMC3% ₹178 Cr 633,973 4. TATA Banking and Financial Services Fund
TATA Banking and Financial Services Fund
Growth Launch Date 28 Dec 15 NAV (24 Apr 26) ₹43.1129 ↓ -0.28 (-0.64 %) Net Assets (Cr) ₹2,743 on 31 Mar 26 Category Equity - Sectoral AMC Tata Asset Management Limited Rating Risk High Expense Ratio 1.98 Sharpe Ratio -0.29 Information Ratio 0.45 Alpha Ratio 3.81 Min Investment 5,000 Min SIP Investment 150 Exit Load 0-3 Months (0.25%),3 Months and above(NIL) Growth of 10,000 investment over the years.
Date Value 31 Mar 21 ₹10,000 31 Mar 22 ₹10,544 31 Mar 23 ₹11,678 31 Mar 24 ₹14,606 31 Mar 25 ₹17,042 31 Mar 26 ₹16,732 Returns for TATA Banking and Financial Services Fund
absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Apr 26 Duration Returns 1 Month 7.3% 3 Month -1.4% 6 Month -3.4% 1 Year 1.9% 3 Year 15.5% 5 Year 13.8% 10 Year 15 Year Since launch 15.2% Historical performance (Yearly) on absolute basis
Year Returns 2024 17.5% 2023 9% 2022 22% 2021 16.9% 2020 11.9% 2019 2.7% 2018 25.7% 2017 -0.1% 2016 45% 2015 17.8% Fund Manager information for TATA Banking and Financial Services Fund
Name Since Tenure Kapil Malhotra 31 Oct 25 0.42 Yr. Data below for TATA Banking and Financial Services Fund as on 31 Mar 26
Equity Sector Allocation
Sector Value Financial Services 97.47% Technology 2.35% Asset Allocation
Asset Class Value Cash 0.18% Equity 99.82% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 31 Jan 16 | HDFCBANK16% ₹439 Cr 6,000,000 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Oct 18 | ICICIBANK14% ₹393 Cr 3,255,000 State Bank of India (Financial Services)
Equity, Since 30 Nov 20 | SBIN10% ₹277 Cr 2,832,000 Axis Bank Ltd (Financial Services)
Equity, Since 30 Nov 18 | 5322159% ₹252 Cr 2,170,000 Shriram Finance Ltd (Financial Services)
Equity, Since 31 Jan 26 | SHRIRAMFIN4% ₹120 Cr 1,374,000
↑ 18,000 SBI Life Insurance Co Ltd (Financial Services)
Equity, Since 31 Jul 25 | SBILIFE4% ₹103 Cr 582,000 Bank of Baroda (Financial Services)
Equity, Since 30 Nov 25 | 5321343% ₹91 Cr 3,660,000 Bajaj Finserv Ltd (Financial Services)
Equity, Since 30 Apr 25 | 5329783% ₹83 Cr 510,000 Canara HSBC Life Insurance Co Ltd (Financial Services)
Equity, Since 31 Oct 25 | CANHLIFE3% ₹80 Cr 5,685,000 ICICI Prudential Asset Management Co Ltd (Financial Services)
Equity, Since 31 Dec 25 | ICICIAMC3% ₹70 Cr 249,000
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All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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Research Highlights for UTI Banking and Financial Services Fund