Karnataka Bank Ltd — Q4 FY26 earnings call
Summary generated by AI from the official transcript Karnataka Bank Ltd filed with BSE on 27 May 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
Karnataka Bank reported Q4 FY26 PAT of INR408.19 crores, up 40% quarter-on-quarter, with full-year FY26 PAT at INR1,310.50 crores, a 3% year-on-year increase. Net interest margin improved to 3.07% in Q4 FY26 from 2.92% in Q3, while gross NPA fell to 2.78% and net NPA to 0.98% as of March 31, 2026. Management said gross advances reached INR83,339.92 crores and CASA ratio stood at 33.61%, and detailed cost-to-income improvement to 50.47% for the quarter.
Numbers mentioned
Total business: INR1,92,118 crores (FY26)
p. 3
“Total business as against the guidance of INR1,92,000 crores of business, the figure was INR1,92,118 crores.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
Gross advances: INR83,339.92 crores (FY26)
p. 3
“Gross advances against a guidance of INR84,000 crores to INR85,000 crores, it was INR83,339.92 crores.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
Deposits: INR1,08,778.75 crores (FY26)
p. 3
“Deposits, against the guidance of INR1,08,000 crores it was INR1,08,778.75 crores.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
CASA: INR36,559 crores (FY26)
p. 3
“CASA, around INR34,500 crores to INR35,000 crores, the figure was INR36,559 crores.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
CASA percentage: 33.61% (FY26)
p. 3
“CASA percentage, we have mentioned as a guidance of 32% to 32.5% against which it was 33.61%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
GNPA: 2.78% (FY26)
p. 3
“GNPA whatever guidance was given less than 3%, it was 2.78%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
NNPA: 0.98% (FY26)
p. 3
“NNPA guidance was less than 1%, it was 0.98%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
NIM: 2.88% Y-o-Y, 3.07% Q4 (FY26 / Q4 FY26)
p. 3
“NIM, we have mentioned at 3% plus, Y-o-Y, it was 2.88%, but Q4 it was 3.07%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
Cost to income ratio: 56.34% FY26, 50.47% Q4 (FY26 / Q4 FY26)
p. 3
“Cost to income, what the guidance was given was 55% to 56%, against which it was 56.34% FY '26, and for Q4 it was 50.47%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
ROA: 1.05% (FY26)
p. 3
“ROA, we have given the guidance of 1% plus, against which it was 1.05%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
ROE: 12.69% Q4, 10.36% FY26 (Q4 FY26 / FY26)
p. 3
“ROE, around 15% we have mentioned, Q4 it was 12.69%, Y-o-Y it was 10.36% for FY '26.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
Yield on Advances: 8.94% (FY26)
p. 3
“Yield on Advances, around 9% was the guidance, against which it was 8.94%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
CD ratio: 76.61% (FY26)
p. 3
“CD ratio, guidance was 75% plus, it was 76. 61%.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
Standard restructured advances: INR806.44 crores (as of March 31, 2026)
p. 3
“Standard restructured, guidance was INR750 crores, it was INR806.44 crores.”
Raghavendra Bhat, page 3 of the filed PDF · View the filing
Net Interest Income (NII): INR843 crores (Q4 FY26)
p. 5
“Net interest income; NII for Q4 FY '26 stood at INR843 crores, as compared to INR792 crores in Q3 FY '26, registering a quarter-on quarter- growth of 6%.”
Raghavendra Bhat, page 5 of the filed PDF · View the filing
PAT: INR408.19 crores (Q4 FY26)
p. 5
“Regarding Profit After Tax, Q4 FY '26 PAT was INR408.19 crores, as against INR290.79 crores in Q3 FY '26, an increase of 40%.”
Raghavendra Bhat, page 5 of the filed PDF · View the filing
PAT: INR1,310.50 crores (FY26)
p. 5
“The Bank has achieved its highest-ever PAT at INR1,310.50 crores as against INR1,272.37 crores, with a Y-o-Y growth of 3%.”
Raghavendra Bhat, page 5 of the filed PDF · View the filing
Gross NPA: 2.78% (as of March 31, 2026)
p. 5
“Stressed Assets - Gross NPA percent as on 31st March '26 stood at 2.78%, as against 3.32% in December '25, thereby showing an improvement of 54 basis points.”
Raghavendra Bhat, page 5 of the filed PDF · View the filing
Net NPA: 0.98% (as of March 31, 2026)
p. 5
“Net NPA percent as on 31st March '26 stood at 0.98%, as against 1.31% in December '25, demonstrating a 33 basis points Q-on-Q improvement.”
Raghavendra Bhat, page 5 of the filed PDF · View the filing
Credit cost: 0.1% (Q4 FY26)
p. 5
“Credit cost stood at 0.1% in Q4 FY '26, against 0.11% in Q3 FY '26.”
Raghavendra Bhat, page 5 of the filed PDF · View the filing
CRAR: 20.07% (as of March 31, 2026)
p. 6
“CRAR stood at 20.07% as on 31st March '26, of which Tier 1- 18.68% and Tier 2- 1.39%, in comparison to 19.94% as on 31st December '25, of which Tier 1 was at 18.44% and Tier 2 was 1.50%.”
Raghavendra Bhat, page 6 of the filed PDF · View the filing
LCR: 165.34% (as of March 31, 2026)
p. 6
“Liquidity Coverage Ratio (LCR) As on 31st March '26, LCR stood at 165.34%, as against 186.84% as on 31st December '25 and as against the statutory target of 100%.”
Raghavendra Bhat, page 6 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
Total business growth — around 15% · FY27
stated firmly by Raghavendra Bhat
p. 8
“The overall position I have given, I will stand firm on it with the overall business growth of around 15% and maintaining we want to have the deposit growth between 10% to 15% and advanced growth of 15% to 20%.”
Raghavendra Bhat, page 8 of the filed PDF · View the filing
CASA percentage — 33%-plus · FY27
stated firmly by Raghavendra Bhat
p. 8
“While focusing on CASA, we have assured that 33% plus, we want to maintain 33%-plus of CASA percentage.”
Raghavendra Bhat, page 8 of the filed PDF · View the filing
ROA — 1% plus · FY27
stated firmly by Raghavendra Bhat
p. 8
“That 1% plus will be definitely towards improvement only.”
Raghavendra Bhat, page 8 of the filed PDF · View the filing
Cost-to-income ratio — between 52% and 53% · FY27
stated as an aspiration by Raghavendra Bhat
p. 8
“It will be between 52% and 53%. Once the costs are under control and the business is running smoothly, we will certainly work on further improvements.”
Raghavendra Bhat, page 8 of the filed PDF · View the filing
PCR — increase 1% every quarter
stated as an aspiration by Raghavendra Bhat
p. 11
“We want to increase 1% every quarter. That number still I'm holding on.”
Raghavendra Bhat, page 11 of the filed PDF · View the filing
Recovery from technically written-off book — 50% of the book
stated as an aspiration by Raghavendra Bhat
p. 13
“What quantum, what number, our aim is always to recover 50% of the book of NPA, 50% of the technical written-off.”
Raghavendra Bhat, page 13 of the filed PDF · View the filing
NIM — 3% plus
stated as an aspiration by Raghavendra Bhat
p. 14
“As I was telling in the beginning, if you have seen, I am working on that 3% plus NIM. I will be working on it.”
Raghavendra Bhat, page 14 of the filed PDF · View the filing
ECL impact on capital — around 1% to 1.5% overall, spread over 25-30 basis points · next 4 to 5 years
stated conditionally by Raghavendra Bhat
p. 10
“I believe the guidelines which has now come, which is available to spread over to the next 5 years and we have studied the impact also maybe around 1% to 1.5% overall will be there.”
Raghavendra Bhat, page 10 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
Management said CRAR was healthy, allowing them to prioritize advances growth, funded through available resources and some short-term borrowings.
Answered by Raghavendra Bhat
Asked by Anshul Patel: Why did advances increase significantly during the quarter and how does it align with funding and liquidity strategy?
p. 7
“There was no shortage of funds. We could meet that funding requirement with the available resources and to some extent in between some short-term funds, we have also met it through borrowings.”
Raghavendra Bhat, page 7 of the filed PDF · View the filing
Management reiterated business growth guidance of around 15%, deposit growth of 10-15%, advance growth of 15-20%, and cost-to-income target of 52-53%.
Answered by Raghavendra Bhat
Asked by Chirag Singhal: What is the guidance on advance growth, ROA, credit cost, cost-to-income for the current fiscal?
p. 8
“For the entire year, cost-to-income ratio has been brought down from 60% plus to 56%, which I was by and large telling 55% plus.”
Raghavendra Bhat, page 8 of the filed PDF · View the filing
Management attributed the rise to fee-based income and recovery from technical write-offs, and said EBLR appears to have bottomed out.
Answered by Vijayakumar P H
Asked by Anand Dama: What drove the sharp rise in other income and is there yield pressure risk for FY27 margins?
p. 9
“The other income increase is on account of fee-based income and also recovery from the technical write-off portfolio.”
Vijayakumar P H, page 9 of the filed PDF · View the filing
Management estimated the ECL impact at around 1-1.5% overall, spread over several years.
Answered by Raghavendra Bhat
Asked by Parth Gutka: What is the impact of ECL guidelines on net worth and credit cost run rate?
p. 10
“We have got adequate capital adequacy ratio, number one. I believe the guidelines which has now come, which is available to spread over to the next 5 years and we have studied the impact also maybe around 1% to 1.5% overall will be there.”
Raghavendra Bhat, page 10 of the filed PDF · View the filing
Management said PCR increases are decided quarter to quarter and reiterated an approximate 1% per quarter target.
Answered by Raghavendra Bhat
Asked by Yash Dantewadia: Where is the bank aiming to take PCR in the next four quarters?
p. 11
“We want to increase 1% every quarter. That number still I'm holding on. But last quarter, we have done more.”
Raghavendra Bhat, page 11 of the filed PDF · View the filing
Management attributed the decline to focused efforts on controlling SMA/CMA accounts, recovery, and stricter borrower selection.
Answered by Raghavendra Bhat
Asked by Priyank Chheda: Why did gross slippages fall sharply in Q4 and what should be considered the normal run rate?
p. 11
“With regard to slippage coming down, I was mentioning earlier also and our focus on the day of taking over charge, I was telling, I want to control the stress.”
Raghavendra Bhat, page 11 of the filed PDF · View the filing
Management said the aim is to recover 50% of the technical write-off book, describing it as an ambitious target.
Answered by Raghavendra Bhat
Asked by Priyank Chheda: What is the target for recovery from the technically written-off book and provisioning impact for FY27?
p. 13
“Therefore we have kept the ambitious target. Whether it is possible, yes, I was telling earlier also, you are not believing, you are not believing me now also, I know that.”
Raghavendra Bhat, page 13 of the filed PDF · View the filing
Management gave a breakdown of the book by base rate, MCLR, and EBLR linked to G-Sec and T-bill rates.
Answered by Raghavendra Bhat
Asked by Sarvesh Gupta: What is the composition of the loan book by rate benchmark (EBLR/G-Sec/MCLR) and outlook for NIM?
p. 14
“To be very frank with you, base rate is 0.31%, MCLR 5.59% at the end of March '26. Then EBLR linked to G-Sec 2.31%, EBLR linked to T-bill rate 55%.”
Raghavendra Bhat, page 14 of the filed PDF · View the filing
Management said internal talent is being developed and branch expansion plans would be adjusted as needed based on market conditions.
Answered by Raghavendra Bhat
Asked by Yaswanth Thippeswamy: Has internal talent been considered for the Executive Director role, and are branch expansion plans affected by the West Asia conflict?
p. 15
“This is like business plans; this is also a plan. And in between if such things arise, we will make course correction and depending upon the market requirements, our growth and requirement, all these things will be planned at an appropriate time.”
Raghavendra Bhat, page 15 of the filed PDF · View the filing
Management said Middle East deposits form only a small portion of the deposit base, mostly domestic.
Answered by Raghavendra Bhat
Asked by Umesh Kantilal Shah: Is the bank dependent on Middle East deposits and how would it be insulated from regional instability?
p. 17
“But we have a little portfolio, not sizable portfolio. Majority is local domestic deposits only.”
Raghavendra Bhat, page 17 of the filed PDF · View the filing
Risks flagged
War in West Asia and rising input costs could weigh on growth
p. 4
“However, the war in West Asia, along with the rising input costs driven by higher energy prices and supply chain disruptions, could weigh on the growth.”
Raghavendra Bhat, page 4 of the filed PDF · View the filing
Geopolitical tensions and global trade frictions pose risk to inflation and economic expansion
p. 4
“The intensity and duration of such conflicts pose risks to both inflation and economic expansion.”
Raghavendra Bhat, page 4 of the filed PDF · View the filing
Global headwinds from geopolitical tensions, volatile commodity prices and supply chain disruptions
p. 7
“Despite global headwinds arising from geopolitical tensions, volatile commodity prices and supply chain disruptions, the Bank continues to differentiate itself through its prudence, resilience, agility and strong customer-centric approach”
Raghavendra Bhat, page 7 of the filed PDF · View the filing
External situation affecting internal operations is outside the bank's control
p. 18
“External situation do affects the internal situation also. That is not in our control.”
Raghavendra Bhat, page 18 of the filed PDF · View the filing
Generated by claude-sonnet-5. Source: the transcript as filed with BSE. We link to the exchange's copy; we do not host transcripts. Parakho is a data and screening tool, not an investment adviser — nothing here is a recommendation to buy, sell or hold.