Karnataka Bank Q2 Result: Profit Jumps 37%, Asset Quality Improves

Karnataka Bank reported a 36.6% year-on-year increase in consolidated net profit to Rs 436 crore in the September quarter, supported by higher operating profit and lower provisions. The bank's total income also increased from a year earlier, while its asset quality improved sequentially.

Karnataka Bank's total income increased to Rs 2,793.96 crore in the September quarter from Rs 2,522.58 crore in the year-ago period. Interest earned rose to Rs 2,503.87 crore from Rs 2,179.18 crore, reflecting growth in income from advances, bills, and investments.

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Interest earned from advances and bills increased to Rs 1,957.48 crore from Rs 1,640.79 crore in the corresponding quarter last year. Income from investments also rose to Rs 442.08 crore from Rs 406.46 crore.

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Operating profit before provisions and contingencies increased 36.8% year-on-year to Rs 602.20 crore. Provisions and contingencies declined to Rs 14.74 crore from Rs 20 crore a year earlier and Rs 28.7 crore in the June quarter.

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Karnataka Bank Asset Quality Improves

Karnataka Bank's asset quality improved in the September quarter compared with the previous three months. Its gross non-performing asset (NPA) ratio, which measures the share of loans overdue or unlikely to be repaid, fell to 2.27% from 2.58% in June. The net NPA ratio declined to 0.74% from 0.87% over the same period.

Stock Movement

Karnataka Bank shares rose 4.25% to Rs 312.80 at around 2:51 p.m. on Wednesday, October 28, following the Q2 results announcement.

Investors will watch whether the bank can maintain its profit growth and continue to bring down bad loans in the coming quarters.

Also Read: Info Edge (India) Appoints Sanjeev Bikhchandani As Group CEO; Q2 Profit Rises 8% QoQ To Rs 480 Crore

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