Shares of Karnataka Bank jumped over 5% on Wednesday morning following the release of strong Q4FY26 earnings. According to reports from Upstox, the shares traded at ₹254 apiece on the NSE, up 2.5% at the time of writing. The private sector bank's stock has delivered impressive returns in 2026, rallying over 26% year-to-date and outperforming the benchmark NIFTY50 index, which is trading 6% lower in the same period.
The bank posted a remarkable 61% year-on-year jump in net profit for Q4FY26, as reported by Upstox. Net-interest income grew 7.8% to ₹843 crore for the quarter ending March 2026, compared to ₹780 crore in the same period last year. The operating profit showed even stronger growth, improving 64% YoY to ₹615 crore versus ₹343 crore in the previous year. This exceptional performance was largely attributed to a sharp drop in employee expenses during the quarter.
According to Upstox reports, the bank demonstrated significant improvement in asset quality metrics. The gross non-performing assets (GNPA) ratio improved from 3.08% in Q3FY25 to 2.78% in Q4FY26. Similarly, the net non-performing assets (NNPA) ratio also strengthened from 1.3% to 0.98% during the same period. The net-interest margins for the quarter also expanded from 2.98% to 3.07%.
As reported by Upstox, the bank's balance sheet showed healthy growth across key metrics. Total advances improved 6.8% YoY to ₹81,809 crore as compared to ₹76,541 crore in the previous year. Deposits grew more modestly by 3.70% to ₹1,08,778 crore compared to ₹1,04,807 crore in FY25. The gross interest income remained relatively stable at ₹2,257 crore versus ₹2,258 crore in the previous year's same quarter.
Commenting on the results, Shri Raghavendra S. Bhat, Managing Director & CEO, stated that the bank has achieved an all-time high annual net profit of ₹1,310.50 crore, reflecting the strength of its resilient business model, focused growth strategy, and continued emphasis on operational efficiency. According to Upstox, the employee benefit expenses dropped over 46% to ₹279 crore compared to ₹346 crore in the same period last year, contributing significantly to the improved profitability.
