Karnataka Bank Q4 Net Profit Jumps 40% QoQ

Total business reached ₹192,118 crore as of March 31, 2026, up 5.12% QoQ from ₹181,394 crore in December 2025
Gross advances stood at ₹83,340 crore as of March 31, 2026, reflecting 8% QoQ growth from ₹77,283 crore
RAM (Retail, Agri, MSME) portfolio grew from ₹49,152 crore in December 2025 to ₹51,197 crore in March 2026 (4% QoQ growth)
Mid-corporate advances grew by approximately 13% during Q4 FY26
Housing, Agri, Gold and Vehicle Loans contributed ₹1,547 crore of growth to Retail segment during the quarter
IBPC and Food Credit portfolio reduced from ₹4,057 crore (March 2025) to ₹1,707 crore (March 2026) - ₹2,350 crore replaced during FY26
Aggregate deposits reached ₹108,779 crore as of March 31, 2026, showing 4% QoQ growth from ₹104,112 crore
CASA ratio improved to 33.61% of aggregate deposits (31.53% in December 2025)
CASA deposits grew 11% QoQ from ₹32,829 crore to ₹36,560 crore
Bulk deposits reduced from 4.8% to 4.2% of total deposits; from 7.1% to 6.3% of term deposits
Retail term deposits grew 2% QoQ from ₹66,252 crore to ₹67,648 crore (5% YoY growth)
CD ratio for Q4 stood at 76.61% (74.23% in December 2025, 74.38% in March 2025)

Net Interest Income (NII) for Q4 FY26: ₹843 crore (6% QoQ growth from ₹792 crore; 8% YoY growth from ₹781 crore)
Net Interest Margin (NIM): 3.07% for Q4 FY26 (2.92% in Q3 FY26, 2.98% in Q4 FY25)
Yield on Advances: 8.78% for Q4 FY26 (8.71% in Q3 FY26)
Cost of Funds: 5.38% for Q4 FY26 (5.46% in Q3 FY26) - 8 bps improvement
Profit After Tax: Q4 FY26 ₹408.19 crore (40% increase from ₹290.79 crore in Q3 FY26; 62% increase from ₹252.37 crore in Q4 FY25)
Full Year FY26 PAT: ₹1,310.50 crore (3% YoY growth from ₹1,272.37 crore)

Gross NPA: 2.78% as of March 31, 2026 (3.32% in December 2025; 3.08% in March 2025) - 54 bps QoQ improvement
Net NPA: 0.98% as of March 31, 2026 (1.31% in December 2025; 1.31% in March 2025) - 33 bps QoQ improvement
Credit Cost: 0.10% in Q4 FY26 (0.11% in Q3 FY26)
Slippage: 0.20% for Q4 FY26 (0.47% in Q3 FY26)
Recoveries (excluding upgrades): ₹150.46 crore in Q4 FY26 (₹114.18 crore in Q3 FY26)
Standard Restructured Advances: ₹806.44 crore as of March 31, 2026 (₹867.95 crore in December 2025) - 7% QoQ reduction
Provision Coverage Ratio (excluding technically written off): 65.39% (61.23% in December 2025)
Provision Coverage Ratio (including technically written off): 83.54% (80.90% in December 2025)
Technical Write-off Portfolio: Approximately ₹2,500 crore outstanding

Cost-to-Income Ratio: Q4 FY26 50.47% (58.72% in Q3 FY26); Full Year FY26 56.34% (60.11% in FY25)
Return on Equity: Q4 FY26 12.69% (9.06% in Q3 FY26)
Return on Assets: Q4 FY26 1.27% (0.92% in Q3 FY26); Full Year FY26 1.05%

Liquidity Coverage Ratio: 165.34% as of March 31, 2026 (186.84% in December 2025; statutory target 100%)
CRAR: 20.07% as of March 31, 2026 (Tier 1: 18.68%, Tier 2: 1.39%) vs 19.94% in December 2025 (Tier 1: 18.44%, Tier 2: 1.50%)

Planned launches: Agri input loans for tobacco crops, Programmable CBDC, NFC-based QR payments, Surrogate-based lending for housing/mortgage, Dropline OD for MSME, LAP for MSME
Technology initiatives: Loan originating system revamp with collateral management, DevSecOps implementation, HRMS revamp, Treasury revamp, BHIM 3.0
Exploring AI tools for internal efficiencies and process improvements

Employee expenses declined due to optimal resource utilization and actuarial revaluation impacts
Other income increase driven by fee-based income and recovery from technical write-off portfolio (₹190 crore booked in Q4)
Loan book composition: 60-65% EBLR linked, with majority (55%) linked to T-bill rate
ECL implementation impact estimated at 1-1.5% overall, to be spread over 4-5 years
Branch expansion plans to continue despite geopolitical concerns, with Middle East deposit exposure not considered sizable
Recovery target: Ambitious goal to recover 50% of technical write-off book