Q2 2026 Karnataka Bank Ltd Earnings Call Transcript
Key Points
- Karnataka Bank Ltd (BOM:532652) reported a 9.1% increase in profit after tax for Q2 FY26, reaching INR 319.12 crore compared to INR 292.40 crore in Q1 FY26.
- The bank's provision coverage ratio (PCR) improved to 60.22% from 59.18% in June 2025, indicating better risk management.
- Retail and MSME segments grew by 4% in Q2 FY26, aligning with the bank's strategic focus on these areas.
- The bank's cost of deposits decreased from 5.73% in Q1 FY26 to 5.54% in Q2 FY26, reflecting effective cost management.
- Karnataka Bank Ltd (BOM:532652) maintained a strong liquidity coverage ratio of 188.16%, well above the statutory target of 100%.
- The bank's net interest margin declined to 2.72% in Q2 FY26 from 2.82% in Q1 FY26, due to a reduction in external loan benchmark rates.
- Aggregate business slightly decreased by 0.6% quarter-on-quarter, reflecting a temporary slowdown.
- The cost to income ratio increased to 58.93% in Q2 FY26 from 58.05% in Q1 FY26, indicating rising operational expenses.
- Gross NPA percentage stood at 3.33% as of September 2025, showing only a marginal improvement from 3.46% in June 2025.
- The bank's CASA deposits showed only a marginal growth of 0.15% from June 2025, indicating challenges in increasing low-cost deposits.
Ladies and gentlemen, good day and welcome to Karnataka Bank Q2 F 5 2025-026 financial results conference call hosted by Karnataka Bank. We have with us today our top management team, Mr. Raghavendra S. Bhatt, managing director and CEO, Mr. Vijay Kumar PH, Chief Financial Officer, Mr. Raguram HS, Chief Risk Officer, Mr. Vinaya Bhatt PJ, Chief Compliance Officer. Mr. Jayanagar Raraja Raos, head of inspection and audit and internal audit HIE, Mr. Mirrenjan Kumar, R, Chief Human Resource Officer and head of branch banking department, Mr. Nagaraja Upadhya P, head of credit sanction department, Mr. Chandra Shekhara G, head of credit sanctions department, Mr. Sham Key, company secretary and head of operations department. Mr. Swar S, head of credit monitoring department, Mr. Raja BS, Chief Operating Officer, COO.
As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing then 0 on the touchstone phone. Please note
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