Karnataka Bank has submitted its investor presentation detailing the unaudited, reviewed Standalone & Consolidated financial results for the quarter and nine months ended December 31, 2025. Key highlights show Gross Advances growing 5% QoQ to ₹77,283 cr, while NIM improved to 2.92%. Asset quality showed marginal improvement, with GNPA at 3.32%. The bank is focusing on digital transformation and strategic growth in Retail, Agriculture, and MSME sectors.
Karnataka Bank Q3 FY26 Financial Highlights Submission
Karnataka Bank Ltd. has officially disclosed its financial performance for the third quarter of FY26 (ending December 31, 2025) via a submission to the stock exchanges. This forms part of the compliance with regulatory disclosure requirements following the scheduled Earnings Conference Call.
Key Performance Metrics Snapshot (Q3 FY26 vs Q2 FY26)
The quarter demonstrated positive momentum in certain areas despite mixed results in profitability:
- Gross Advances: Increased by 5% QoQ, reaching ₹77,283 cr. Retail Advances grew 3% QoQ to ₹40,453 cr.
- Deposits: Total Deposits grew 1% QoQ to ₹1,04,112 cr. CASA deposits rose by 3% QoQ to ₹32,829 cr.
- Net Interest Margin (NIM): Improved significantly by 20 bps QoQ to 2.92%, driven by Net Interest Income (NII) rising 8.78% QoQ.
- Profitability: PAT stood at ₹290.79 Cr, marking a QoQ decline of 8.88%. ROA stood at 0.92%, and ROE at 9.06%.
- Asset Quality: GNPA slightly improved by 1 bps QoQ to 3.32%. NNPA improved by 4 bps QoQ to 1.31%.
- Credit Cost: Increased to 0.11% (an 8 bps QoQ rise).
Operational and Structural Enhancements
Driving Excellence in Proven Core Competencies (Strategy A)
The bank emphasized leveraging its 100+ Year Legacy, noting 14 Million happy customers. Key focus areas include:
- MSME & Rural Focus: Share of MSME & Agri-Loans stands at 33.7%, with 46.56% of branches in Rural & Semi-Urban Areas.
- Retail Focus: Retail Advances saw an increase to 52.3% of total advances (up from 45.5% in FY20).
- Geographical Reach: The bank has a pan-India presence across 22 States, with 612 branches in Karnataka. Total branch network stands at 960.
Creating a Performance-Driven Culture (Strategy B)
Efforts focus on rebuilding outward-facing, business-centric teams:
- Sales Force Deployment: 229 Sales Officers and 115 Feet on Ground cover key markets.
- Decentralization: 15 Regional Offices decentralized into 42 Clusters.
- Partnerships: Onboarded 201 Business Correspondents (BCs).
Digitalisation and Partnership for Growth (Strategy C)
The bank is advancing its digital strategy through infrastructure upgrades and partnerships:
- A dedicated ‘Technology, Digital & Product Hub’ of 40,000 sq. ft. has been established in Bengaluru, employing 300+ skilled employees.
- The infrastructure now includes a developer portal featuring over 570+ APIs and integration with CRM for better customer engagement.
- Digital touchpoints show strong growth: 40,10,294 Mobile App Installations (1.92% QoQ) and 6,91,519 Net Banking Users (1.84% QoQ).
- The bank received 5 prestigious IBA Awards, including Winner for Best Fintech & DPI Adoption.
Targeted Performance Improvement
The bank aims to consolidate its financial position to boost returns with specific targets:
- CASA %: Target range of 30.0% – 32.0%.
- Cost of Funds: Target range of 5.3% – 5.6%.
- NIM %: Target range of 3% – 3.3%.
- NNPA: Target range of 1% – 1.2%.
- Cost to Income %: Target range of 53.0% – 56.0%.
- ROA %: Target range of 1.1% – 1.2%.
Shareholder Value
The shareholding pattern shows Indian Public holding at 61.9%. Market Capitalization stood at approximately ₹7,771 Cr as of December 2025, with Basic EPS at ₹30.5 per share.
Source: BSE
