News ArticleKarnataka Bank Hits Record Rs. 2.07 Lakh Crore Aggregate Business and Rs. 435.89 Crore Net Profit in Q2 FY27
Bank’s gross advances rose 25% YoY to Rs. 92,015.26 crores; net interest margin improved by 45 bps to 3.17% as of September 30, 2026
Karnataka Bank achieved an all-time high aggregate business of Rs. 2,07,132.41 crores and a net profit of Rs. 435.89 crores for the quarter ended September 30, 2026, reflecting significant year-on-year growth in deposits, advances, and improved asset quality along with enhanced net interest margin.
Karnataka Bank Ltd.
General / Other
Karnataka Bank reported a record aggregate business of Rs. 2,07,132.41 crores and net profit of Rs. 435.89 crores for the quarter ended September 30, 2026, marking significant growth across key financial metrics compared to the same period last year.
The bank's aggregate deposits rose to Rs. 1,15,117.15 crores with a 12% year-on-year increase, supported by a 10% growth in retail term deposits to Rs. 72,197.32 crores.
Gross advances grew by 25% year-on-year to Rs. 92,015.26 crores, highlighting robust lending activities.
Net interest margin improved by 45 basis points from 2.72% in Q2 FY26 to 3.17% in Q2 FY27, driven by higher net interest income totaling Rs. 982.44 crores.
Asset quality improved considerably, with gross non-performing assets (GNPA) ratio reducing by 106 basis points to 2.27% and net NPA ratio dropping by 61 basis points to 0.74%.
The provision cover ratio (PCR) excluding technical write-offs rose sharply from 60.22% to 68.05%, reflecting strengthened credit risk management.
Highlights
- Aggregate business reached Rs. 2,07,132.41 crores, a 17.38% increase year-on-year.
- Net profit for Q2 FY27 stood at Rs. 435.89 crores, a 36.59% increase year-on-year.
- Gross advances increased 24.95% to Rs. 92,015.26 crores year-on-year.
- Deposit base rose to Rs. 1,15,117.15 crores, up 11.96% year-on-year.
- Net interest margin improved by 45 basis points to 3.17%.
- Gross NPA ratio reduced to 2.27%, down 106 basis points year-on-year; net NPA ratio fell to 0.74%.
Key Data Snapshot
What happened
- Karnataka Bank achieved an all-time high aggregate business of Rs. 2,07,132.41 crores for Q2 FY27 ending September 30, 2026.
- The bank reported a net profit of Rs. 435.89 crores for Q2 FY27, a 36.59% increase from Q2 FY26.
- Gross advances rose by nearly 25% year-on-year to Rs. 92,015.26 crores.
- Total deposits increased by 12% year-on-year to Rs. 1,15,117.15 crores.
Key details
- Net interest margin improved to 3.17% in Q2 FY27 from 2.72% in Q2 FY26, an increase of 45 basis points.
- Retail term deposits grew 10% year-on-year to Rs. 72,197.32 crores.
- Gross NPA ratio improved by 106 basis points to 2.27%, indicating better asset quality.
- Net NPA ratio improved by 61 basis points to 0.74%.
- Provision cover ratio excluding technical write-offs rose to 68.05% from 60.22% year-on-year.
Financial performance
- Net interest income increased to Rs. 982.44 crores for Q2 FY27, a 34.93% increase compared to the previous year’s quarter.
- Operating profit for the quarter stood at Rs. 602.22 crores, up 36.86% year-on-year.
- Return on assets improved to 1.26% in Q2 FY27 from 1.03% in Q2 FY26.
- Cost to income ratio decreased, reflecting improved operational efficiency.
Management commentary
- The Managing Director & CEO highlighted the milestone achievement of record aggregate business and net profit, attributing it to steady growth, sound financial management, and customer focus.
- The bank's RAM (Retail, Agriculture, and MSME) segment grew 19% year-on-year, driven by customer trust and employee dedication.
- The CEO noted significant improvement in asset quality supported by disciplined underwriting and recovery efforts.
- The bank is accelerating digital transformation for enhanced customer experience and operational efficiency.
- The Executive Director emphasized disciplined implementation, technology adoption, and employee capacity building as keys to steady progress and improving service quality.
Highlights
- Aggregate business reached Rs. 2,07,132.41 crores, a 17.38% increase year-on-year.
- Net profit for Q2 FY27 stood at Rs. 435.89 crores, a 36.59% increase year-on-year.
- Gross advances increased 24.95% to Rs. 92,015.26 crores year-on-year.
- Deposit base rose to Rs. 1,15,117.15 crores, up 11.96% year-on-year.
- Net interest margin improved by 45 basis points to 3.17%.
- Gross NPA ratio reduced to 2.27%, down 106 basis points year-on-year; net NPA ratio fell to 0.74%.
Disclosures
- SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
Source Information
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