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Informist, Tuesday, May 19, 2026

By Vaishali Tyagi

NEW DELHI – Karnataka Bank's net profit surged in the March quarter after posting only a marginal rise in the previous quarter, supported by a sharp fall in total expenditure. This was the strongest quarterly bottom-line growth in 11 quarters. However, a modest fall in total income limited the bank's bottom-line growth. 

The bank's net profit rose 62% on year to INR 4.08 billion in Jan-Mar. Sequentially, it grew over 40%. The lender's total expenditure, excluding provisions and contingencies, fell nearly 12% on-year to INR 20.41 billion in the March quarter. Of these, interest expenses fell by over 4% on year to INR 14.14 billion. The bank's operating expenses fell by about 25% on-year to INR 6.27 billion during the quarter. 

The lender's total income marginally fell to INR 26.56 billion in the March quarter from INR 26.87 billion a year ago. Of the total income, interest income fell to INR 22.57 billion, down marginally from INR 22.58 billion a year ago. Other income of the bank fell nearly 7% on year to INR 3.99 billion in the March quarter.

The bank announced a final dividend of INR 5 per share. On Tuesday, its shares ended 2.0% higher at INR 247.75 on the National Stock Exchange. The company announced the March quarter earnings after market hours. 

The lender's provisions and contingencies rose almost threefold on year to INR 903.4 million in the March quarter.  

The bank's net non-performing assets ratio fell to 0.98% as of Mar. 31 from 1.31% a quarter ago and the gross non-performing assets ratio improved to 2.78% from 3.32% at the end of December. The lender recorded INR 1.15 billion in non-performing asset upgrades and INR 1.50 billion in cash recoveries in the reporting quarter. 

The private-sector bank's slippage ratio was 0.20%, down from 0.34% reported a year ago. The bank's provision coverage ratio was 83.54% as of Mar. 31, up from 81.42% a year ago. 

The bank's Basel-III capital adequacy ratio was 20.07% as on Mar. 31. For 2025-26 (Apr-Mar), Karnataka Bank reported a net profit of INR 13.11 billion, up 3% from a year ago. Total income during the year remained broadly flat at INR 103.21 billion. 

The lender's net interest income for the quarter was INR 8.43 billion, up nearly 8% on year. The lender's net interest margin rose to 3.07% in the March quarter from 2.92% in the trailing quarter. The bank's net interest margin was 2.98% a year ago.

On the business front, the bank's advances rose nearly 7% on year to INR 818.1 billion and total deposits increased nearly 4% on year to INR 1.09 trillion as of Mar. 31. The current account savings account ratio was 33.61% at the end of March, up from 31.53% at the end of December and 31.75% a year ago. Cost of deposits for the bank fell to 5.37% in Jan-Mar from 5.43% in the trailing quarter. The cost of funds declined to 5.38% from 5.46% in Oct-Dec and 5.83% a year ago.  End

Edited by Saji George Titus

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