Karnataka Bank Q2 Results: Profit dips 5% YoY; asset quality improves sequentially

Karnataka Bank on Saturday reported a 5.06% year-on-year decline in net profit at ₹319.22 crore for the quarter ended September 2025, compared to ₹336.24 crore in the same period last year. Net interest income (NII) fell 12.6% YoY to ₹728.13 crore, down from ₹833.56 crore a year earlier, reflecting pressure on core interest margins. However, the lender’s asset quality showed improvement on a sequential basis. Gross non-performing assets (NPAs) stood at 3.33%, compared with 3.46% in the previous quarter, while net NPAs declined to 1.35% from 1.44% in the June quarter, underscoring steady recoveries and prudent provisioning.