Net interest income (NII) increased 8% year-on-year to ₹843 crore from ₹780.7 crore.
The bank’s asset quality improved significantly during the quarter. Gross non-performing assets (GNPA) declined to 2.78% from 3.32% in the previous quarter, while net NPA fell to 0.98% from 1.31%.Ahead of the earnings announcement, shares of Karnataka Bank closed 2.2% higher at ₹248.20 on the NSE.
The board recommended a final dividend of ₹5 per share for FY26.Managing Director and CEO Raghavendra S. Bhat said the bank achieved its highest-ever annual net profit of ₹1,310.5 crore during FY26, reflecting resilient business growth, operational efficiency and stronger risk management.
The bank also reported an all-time high aggregate business turnover of ₹1.92 lakh crore for FY26, driven by healthy growth in both deposits and advances.
Aggregate deposits stood at ₹1.09 lakh crore as of March 31, 2026, registering 4% quarter-on-quarter growth. CASA deposits grew 11% sequentially to ₹36,559.66 crore, taking the CASA ratio to 33.61% from 31.53% in the previous quarter.
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Gross advances rose 8% quarter-on-quarter to ₹83,339.92 crore, while net interest margin improved by 15 basis points sequentially to 3.07%.
The bank said it remains focused on building a diversified credit portfolio, improving operational efficiency through technology and analytics-led initiatives, and strengthening digital capabilities to enhance customer experience.
