The bank’s profit before tax (PBT) for Q1 FY26 stood at Rs 356.49 crore, marking a 31.2% decline from the same period last year.
Net interest income (NII) for the quarter was at Rs 755.60 crore, down 16.36% from Rs 903.36 crore posted in Q1 FY25. Net interest margin (NIM) reduced to 2.82% in Q1 FY26 compared with 3.54% reported in the corresponding quarter of the previous year.
The bank's provisions (other than tax) and contingencies surged 175.24% to Rs 110.80 crore in Q1 FY26 as against Rs 40.26 crore in Q1 FY25.
Operating profit was at Rs 467.29 crore in Q1 FY26, down 16.34% from Rs 558.59 crore in Q1 FY25.
As of 30 June 2025, the bank’s aggregate business (gross) stood at Rs 177,509.19 crore, a YoY growth of 1.12%. The aggregate deposits grew 3.16% YoY to Rs 103,242.17 crore, while gross advances declined 1.57% YoY to Rs 74,267.02 crore.
On the asset quality front, the bank's gross non-performing assets (NPAs) stood at Rs 2,571.09 crore as of 30 June 2025, as against Rs 2,668.45 crore as of 30 June 2024. Net NPAs stood at Rs 1,049.53 crore in Q1 FY26 as against Rs 1,228.25 crore posted in Q1 FY25.
The ratio of gross NPAs declined to 3.46% as of 30 June 2025 from 3.54% as of 30 June 2024. The ratio of net NPAs stood at 1.44% as of 30 June 2025 compared to 1.66% as of 30 June 2024.
Provision coverage ratio (PCR) increased by 314 bps to 81.11% as of 30 June 2025 from 77.97% as of 30 June 2024.
The Capital Adequacy Ratio of the bank improved to 20.46% in Q1 FY26 compared to 17.64% in Q1 FY25.
Raghavendra S Bhat, managing director & CEO of the Karnataka Bank, said, “During the period, the Bank has registered a moderate YoY growth in top-line numbers. The investments made by the bank during the last FY on the development of infrastructure and processes will start showing results in the coming quarters.
and resultantly NII. Further, the bank is also pursuing its efforts to create quality credit assets, and initiatives are there at all levels to restrict slippages and recover non-performing assets. Our path of growth is a continuous process, and we are committed to all the stakeholders.”
Karnataka Bank, a leading 'A' Class Scheduled Commercial Bank in India, was incorporated on 18th February 1924 at Mangaluru.
Shares of Karnataka Bank shed 0.78% to Rs 170.95 on the BSE.