Karnataka Bank shares surged 7.20% to ₹265.60 on May 20, 2026, compared to the previous close of ₹247.75, following the lender's strong quarterly results for Q4FY26. The stock opened higher at ₹255.40 and traded in the range of ₹252.10 to ₹271.40 during the session. Around 155.47 lakh shares were traded with a total traded value of ₹407.27 crore, taking the bank's market capitalization to approximately ₹10,000 crore. The stock has significantly outperformed broader markets, delivering gains of 27% in 2026 compared to the benchmark Nifty 50's decline of 9.7% during the same period.
For the financial year ended March 31, 2026, Karnataka Bank achieved an all-time high annual net profit of ₹1,310.50 crore, marking a significant milestone in the bank's financial performance. The lender's Q4 FY26 net profit surged by a staggering 61.74% year-on-year to ₹408.19 crore, climbing from ₹252.37 crore reported in the corresponding March quarter of the previous fiscal year (Q4 FY25). The bank demonstrated robust growth in profitability and operational efficiency during the quarter, with Net Interest Income (NII) for Q4 FY26 expanding by 7.98% YoY to ₹842.95 crore, up from ₹780.68 crore in Q4 FY25. Total income for the final quarter reached ₹1,241.81 crore, reflecting a steady 2.72% annual progression compared to ₹1,208.91 crore posted in the year-ago period.
The bank's operational efficiency showed remarkable improvement with Cost to Income ratio improving significantly to 50.47% in Q4 FY26 from 68.98% in the previous year's corresponding quarter. Karnataka Bank's aggregate deposits stood at ₹1,08,778.75 crore as on March 31, 2026, registering 4% Q-o-Q growth from ₹1,04,111.52 crore. The lender's CASA deposits grew to ₹36,559.66 crore in the March quarter, up from ₹32,828.70 crore in the preceding quarter. The CASA ratio stood at 33.61% as on March 31, 2026, marking a 186 basis points improvement over the 31.75% reported in the previous cycle, reflecting heightened execution of retail client retention strategies. The bank achieved an all-time high aggregate business of ₹1,92,118.67 crore during FY2026.
The bank successfully minimized toxic exposures across corporate and retail frameworks with significant improvements in asset quality metrics. The Gross Non-Performing Assets (GNPA) ratio declined to 2.78% in Q4 FY26, marking a 54 basis points reduction against the 3.32% logged in the immediate sequential quarter, and a clear step down from the 3.08% posted a year ago. Similarly, the Net Non-Performing Assets (NNPA) ratio improved to a microscopic 0.98%, plunging beneath the 1.31% registered in the same period last year. The Provision Coverage Ratio (PCR), excluding technical write-offs, enhanced to 65.39%, indicating tighter internal cushioning models against macroeconomic volatility. The bank's gross advances grew by 8% quarter-on-quarter to ₹83,339.92 crore, while total deposits increased to ₹1,08,778.75 crore.
The board has recommended a final dividend of ₹5 per equity share (i.e., 50% of the face value of ₹10 each per equity share) for the financial year ended March 31, 2026, subject to approval of the shareholders at the ensuing Annual General Meeting. The date of the AGM, the record date for determining eligible members, and the dividend payout date will be intimated in due course. Alongside the financial results, the board announced the strategic appointment of Mrs. Biji Sreekrishnavilas Sankaranarayanan as an Additional Director and Executive Director for a three-year tenure, following official approval from the Reserve Bank of India (RBI) on May 13, 2026. This proposed dividend is subject to the formal sign-off from the bank's members at the upcoming Annual General Meeting.
