Karur Vysya Bank Ltd — Q4 FY26 earnings call
Summary generated by AI from the official transcript Karur Vysya Bank Ltd filed with BSE on 12 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
Karur Vysya Bank reported record quarterly and full-year net profit for Q4 and FY26, with net interest margin for the full year at 3.97% and gross NPA at 0.75%. Management said advances grew 17% and deposits grew 13% year-on-year, while total business rose 15% to Rs 2,14,420 crores. For FY27, management guided to net interest margins of 3.75% to 3.8%, credit growth of 1% to 2% over industry, and return on assets of 1.7% to 1.8%, citing rising deposit costs and competitive pressure on yields.
1 statement from this call is not shown because its supporting quote could not be reproduced within our quoting limits. Nothing shown here is affected: every statement on this page carries its verified quote.
Numbers mentioned
Total business: INR2,14,420 crores (FY26)
p. 3
“The bank's total business stands at INR2,14,420 crores as on 31st March 2026 as compared to previous year INR1,86,569 crores, registering a growth of 15%.”
B. Ramesh Babu, page 3 of the filed PDF · View the filing
Advances: INR98,754 crores (FY26)
p. 3
“The advances stand at INR98,754 crores and deposits grew to INR1,15,666 crores with a growth of 17% and 13%, respectively.”
B. Ramesh Babu, page 3 of the filed PDF · View the filing
Net interest margin: 3.97% (FY26)
p. 5
“I'm happy to say that we were able to maintain a NIM for the full year at 3.97%.”
B. Ramesh Babu, page 5 of the filed PDF · View the filing
Net interest margin: 4.25% (Q4 FY26)
p. 5
“NIM for the fourth quarter was 4.25%, excluding 7 basis points interest income from tax refund -- income tax refund.”
B. Ramesh Babu, page 5 of the filed PDF · View the filing
Operating profit: INR4,075 crores (FY26)
p. 6
“We have achieved operating profit of INR1,247 crores for the quarter and INR4,075 crores for the full year, a growth of 27% over previous year.”
B. Ramesh Babu, page 6 of the filed PDF · View the filing
Net profit: INR2,500 crores (FY26)
p. 6
“Our net profit touched a high of INR725 crores for the quarter and INR2,500 crores for the full year, a growth of 29%.”
B. Ramesh Babu, page 6 of the filed PDF · View the filing
Gross slippages: INR744 crores (FY26)
p. 6
“And for the full year, it was INR744 crores, which is 0.75% of our loan book.”
B. Ramesh Babu, page 6 of the filed PDF · View the filing
Gross NPA: 0.75% (FY26)
p. 6
“Our gross NPA has come down marginally to 0.75% as against 0.76% of last year.”
B. Ramesh Babu, page 6 of the filed PDF · View the filing
Net NPA: 0.19% (FY26)
p. 6
“Our net NPA remains at the level of 0.19%, and we would continue to maintain net NPA at less than 1% of our loan book.”
B. Ramesh Babu, page 6 of the filed PDF · View the filing
Cost-to-income ratio: 42% (FY26)
p. 6
“Our cost-to-income ratio for the quarter is 37%, supported by higher recoveries, interest on income tax refund and lower establishment costs. And this is for the quarter and 42% for the full year, which is within the guidance of below 50%.”
B. Ramesh Babu, page 6 of the filed PDF · View the filing
CRAR: 18.76% (as of 31 March 2026)
p. 7
“Our CRAR continues to be healthy and is at 18.76%, providing us comfortable headroom for growth.”
B. Ramesh Babu, page 7 of the filed PDF · View the filing
Return on assets: 1.93% (FY26)
p. 7
“We have achieved an ROA of 2.1% in this quarter and 1.93% for the full year.”
B. Ramesh Babu, page 7 of the filed PDF · View the filing
Prudential provisions: INR163 crores (Q4 FY26)
p. 6
“We have provided prudentially INR163 crores, I repeat INR163 crores is a onetime towards sectors identified that may get affected due to ongoing geopolitical tensions.”
B. Ramesh Babu, page 6 of the filed PDF · View the filing
Dividend: 130% (FY26)
p. 7
“I'm happy to share that we have declared a dividend of 130% as declared last year, and this is subject to shareholders' approval.”
B. Ramesh Babu, page 7 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.
Net interest margin — 3.75% to 3.8% · FY27
stated firmly by B. Ramesh Babu
p. 8
“With respect to margins, we expect that NIMs to be in the range of 3.75% to 3.8% for the full year, though we are at 4% plus at the exit quarter of this year.”
B. Ramesh Babu, page 8 of the filed PDF · View the filing
Credit growth — 1% to 2% over industry growth · FY27
stated firmly by B. Ramesh Babu
p. 7
“We expect our credit growth to be 1% or 2% over the industry growth.”
B. Ramesh Babu, page 7 of the filed PDF · View the filing
Return on assets — 1.7% to 1.8% · FY27
stated firmly by B. Ramesh Babu
p. 9
“Given the current macroeconomic environment and the anticipated effects on the net interest margins discussed earlier, we expect the ROA for the full year to be between 1.7% to 1.8%.”
B. Ramesh Babu, page 9 of the filed PDF · View the filing
Cost-to-income ratio — below 50% · FY27
stated firmly by B. Ramesh Babu
p. 9
“Our cost-to-income ratio would be below 50% as we have been continuously planning, and we'll endeavor to retain that way.”
B. Ramesh Babu, page 9 of the filed PDF · View the filing
Gross NPA — less than 1.5% · FY27
stated firmly by B. Ramesh Babu
p. 9
“GNPA is expected to be less than 1.5% and net NPA to be less than 1% for the full year.”
B. Ramesh Babu, page 9 of the filed PDF · View the filing
Slippages — below 1% of the asset book · FY27
stated firmly by B. Ramesh Babu
p. 9
“Slippages would be expected to be below 1% of the asset book.”
B. Ramesh Babu, page 9 of the filed PDF · View the filing
LCR — 115% to 120% · FY27
stated firmly by B. Ramesh Babu
p. 9
“LCR would be maintained around 115% to 120%.”
B. Ramesh Babu, page 9 of the filed PDF · View the filing
Branch expansion — 50 branches · FY27
stated firmly by B. Ramesh Babu
p. 9
“With respect to branch expansion, we are planning to open 50 branches.”
B. Ramesh Babu, page 9 of the filed PDF · View the filing
Investment portfolio yield — 15 to 20 basis points · FY27
stated as an aspiration by B. Ramesh Babu
p. 8
“We expect 15 to 20 basis points investment portfolio yield, yield enhancement through strategic rebalancing of the HTM portfolio during '26-'27.”
B. Ramesh Babu, page 8 of the filed PDF · View the filing
Credit cost — less than 1% · FY27
stated as an aspiration by B. Ramesh Babu
p. 16
“Credit cost, I can think around less than 1% we can think of.”
B. Ramesh Babu, page 16 of the filed PDF · View the filing
Gold loan portfolio share — 32% to 33%
stated conditionally by B. Ramesh Babu
p. 19
“So it can go up to 32%, 33% because depending upon the opportunity, what all is there, bring it down or if we find any other product which is worth giving and it is supporting our riskreward, we may go that -- there also.”
B. Ramesh Babu, page 19 of the filed PDF · View the filing
Capital raise — no external capital raise needed · FY27
stated conditionally by B. Ramesh Babu
p. 7
“There may not be any need to raise money in financial year '26-'27 for the growth plan as our plough-back of net profits will take care of our growth plan.”
B. Ramesh Babu, page 7 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 explained that rising deposit costs and the need to reduce rate concessions to retain relationships would compress margins toward 3.75%-3.8%.
Answered by B. Ramesh Babu
Asked by Jai Mundhra: What is the NIM guidance for FY27 given last year's guidance was beaten?
p. 10
“That is the reason we need to take a conscious call, having such a strong NIM is good to have, but not at the cost of continuously losing the top line.”
B. Ramesh Babu, page 10 of the filed PDF · View the filing
Management said growth would be 1-2% above industry, and deposit growth would be derived from LCR requirements rather than CD ratio.
Answered by B. Ramesh Babu
Asked by Jai Mundhra: What is the overall credit growth guidance for the bank?
p. 10
“So let us confine to 18% and maintain the margins. This year also what the guidance I gave is, particularly in respect to the credit, so it will be 1% or 2% over the market or industry.”
B. Ramesh Babu, page 10 of the filed PDF · View the filing
Management described softness in textiles due to tariff and logistics issues, and lower working capital utilization of 2-3% across many sectors, while saying the situation remains dynamic.
Answered by B. Ramesh Babu
Asked by Rohan Mandora: What is the on-ground business momentum in sectors where prudential provisions were created?
p. 15
“As I was mentioning in my guidance, we started seeing the lower level of utilization in the working capital. 2% to 3%, it is down across the sectors, many sectors, it is there.”
B. Ramesh Babu, page 15 of the filed PDF · View the filing
Management named textile, ceramics, fertilizers, chemicals and granite/quartz sectors as those covered by the provisioning exercise.
Answered by B. Ramesh Babu
Asked by Pritesh Bumb: What sectors received the prudential provisions of about INR160 crores?
p. 12
“there are a few sectors which actually have a risk when we saw it can be, let us say, to some extent, textile also we have taken, okay? Like ceramics, we have taken, fertilizers, we have taken, chemicals, we have taken that way.”
B. Ramesh Babu, page 12 of the filed PDF · View the filing
Management said despite geopolitical uncertainty, customers on the ground remain confident and none have sought support, though the bank is monitoring the situation.
Answered by B. Ramesh Babu
Asked by M.B. Mahesh: Is there a different default risk on the BBB portfolio compared to A-rated exposures?
p. 18
“Surprisingly, even today, last 15 days when I'm talking, not even a single customer has given any pessimistic view saying that it is going to crash, I have a problem, nothing.”
B. Ramesh Babu, page 18 of the filed PDF · View the filing
Management said the internal cap is 35% and the bank is currently at 28-30%, with room to increase to 32-33% depending on opportunities, while maintaining margin buffers against gold price fluctuations.
Answered by B. Ramesh Babu
Asked by Akshay Badlani: What is the outlook and comfort level for gold loan portfolio growth?
p. 19
“We thought 35% can be ideal. But still conservatively, we have been maintaining between 28% to 30%, as you mentioned now.”
B. Ramesh Babu, page 19 of the filed PDF · View the filing
Management said this reflects a prudent approach in a benign environment to avoid additional credit cost offsetting any yield gains, not a capital constraint.
Answered by B. Ramesh Babu
Asked by Jayant K.: Why is the FY27 credit growth guidance lower at 1-2% over industry versus 2% last year?
p. 22
“Only thing what we thought is, as we said, it's a benign environment outside. When to grow, it's pretty easy to understand. When to lie low and take a careful call, that requires some sort of care.”
B. Ramesh Babu, page 22 of the filed PDF · View the filing
Risks flagged
Geopolitical tensions and conflict in West Asia affecting input costs and supply chains
p. 7
“However, conflict in West Asia could impede progress, increased input costs from energy prices, freight, insurance and supply chain disruptions are expected to limit expansion.”
B. Ramesh Babu, page 7 of the filed PDF · View the filing
Textile sector exposure facing tariff and logistics issues
p. 14
“So they had the problem of tariff issues. And when tariff issues have come out now and all, suddenly other issues have come out now like not getting the vessels, these things.”
B. Ramesh Babu, page 14 of the filed PDF · View the filing
Competitive pressure on pricing leading to loss of good accounts
p. 10
“Now the stage has come, getting back these connections will become pretty difficult over a period of time if we still hold these rates so strong. So we may have to concede and reduce the rates to existing customers”
B. Ramesh Babu, page 10 of the filed PDF · View the filing
Rising cost of deposits from retail deposit rate hikes taken in April 2026
p. 8
“So we envisage a drop in margins due to expected rate increase in the retail time deposits.”
B. Ramesh Babu, page 8 of the filed PDF · View the filing
Lower utilization of working capital limits across sectors
p. 15
“As I was mentioning in my guidance, we started seeing the lower level of utilization in the working capital. 2% to 3%, it is down across the sectors, many sectors, it is there.”
B. Ramesh Babu, page 15 of the filed PDF · View the filing
Gold price volatility affecting collateral value in jewel loan book
p. 19
“That can be a portfolio which can be having a problem if really gold prices crash by 40%.”
B. Ramesh Babu, page 19 of the filed PDF · View the filing
Uncertainty around final RBI ECL provisioning guidelines
p. 9
“RBI has issued final ECL provisioning guidelines, which we are reviewing.”
B. Ramesh Babu, page 9 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.