Karnataka Bank shares dropped over 3% following the announcement of its Q4FY25 results, as investors reacted to a dip in profitability. As of 9:19 AM, the shares were trading 3.58% lower at Rs 200.24.
The bank reported an 8% year-on-year (YoY) fall in net profit to ₹252.4 crore for the March 2025 quarter, compared to ₹274.2 crore in the same period last year.
For the full financial year FY25, Karnataka Bank reported a 2.6% decline in net profit, which fell to ₹1,272.37 crore from ₹1,306.28 crore in FY24. Net interest income (NII) also dipped 6.4% year-on-year, coming in at ₹780.7 crore compared to ₹834.1 crore the previous year.
On the asset quality front, the bank showed slight improvement. Gross non-performing assets (GNPA) reduced to 3.08%, down from 3.11% in the previous quarter, while net NPA declined to 1.31% from 1.39%. The provision coverage ratio improved significantly to 81.42%, up from 79.22% a year earlier.
Karnataka Bank’s strategic emphasis on retail lending yielded positive results, with retail advances growing 15.44% YoY to ₹39,273 crore. Total gross advances rose 6.79% YoY to ₹77,958.72 crore. Aggregate deposits increased by 6.96% to ₹1,04,807.49 crore, while CASA deposits saw a 6.35% uptick to ₹33,281 crore.
Retail deposits formed 93.4% of total deposits, slightly higher than 93.2% in FY24. The bank remains well-capitalised with a CRAR of 19.85%, ensuring strong financial stability despite the earnings pressure.
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