Transcript of Q1FY27 Earnings Audio Conference Call

Karnataka Bank Ltd. Your Family Bank, Across India Regd. & Head Office Phone : 0824-2228222 P. B. No.599, Mahaveera Circle E-Mail : comsec@ktk.bank.in Kankanady Website : www.karnatakabank.bank.in Mangaluru – 575 002 CIN : L85110KA1924PLC001128 SECRETARIAL DEPARTMENT HO:SEC: 116:2026-27 Date: 06.08.2026 The Manager The Manager Listing Department Corporate Relationship Department National Stock Exchange of India Limited BSE Limited Exchange Plaza, C-1, Block G Phiroze Jeejeebhoy Towers Bandra-Kurla Complex, Bandra (E) Dalal Street MUMBAI - 400051 MUMBAI - 400001 NSE Scrip Code: KTKBANK BSE Scrip Code: 532652 Madam / Dear Sir, Sub: Transcript of Q1FY27 Earnings’ Audio Conference Call Pursuant to Regulation 30 read with Clause 15 (b) of Para A of Part A of Schedule III and Regulation 46 (2) (oa) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we attach herewith the transcript of the post results analysts / institutional investors audio conference call held on Thursday, July 30, 2026, on the unaudited Standalone & Consolidated Financial Results of the Bank for the quarter ended June 30, 2026. The same is also made available on the Bank’s website under the following web link: https://karnatakabank.bank.in/investors/quarterly-results This is for your kind information and dissemination. Yours faithfully, Sham K Company Secretary & Compliance Officer “Karnataka Bank Limited Q1 FY27 Earnings Conference Call” July 30, 2026 MANAGEMENT: MR. RAGHAVENDRA S BHAT – MANAGING DIRECTOR & CEO MRS. BIJI S S – EXECUTIVE DIRECTOR Page 1 of 14 The Karnataka Bank Limited July 30, 2026 Moderator: Ladies and Gentlemen, good day and welcome to The Karnataka Bank Limited Q1 FY27 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Raghavendra Bhat, Managing Director & CEO and Mrs. Biji S S, Executive Director from The Karnataka Bank Limited, who are on the line along with the top management. Thank you and over to you, Mr. Raghavendra Bhat. Raghavendra Bhat: Yes. Good evening, ladies and gentlemen and thank you for joining Q1 FY27 Earnings Call of the Karnataka Bank, an institution that has stood the test of time for over 102 years. Rooted in its legacy from the coastal city of Dakshina Kannada, formerly South Canara, fondly known as the Cradle of Indian Banking, Karnataka Bank proudly stands as one of the only 2 surviving institutions from the region's historic five original banks. From its humble beginnings to now entering its second century of banking excellence, Karnataka Bank continues to grow stronger and is a trusted banking partner for millions across the globe. Ably guided by the Chairman and the Board, our Q1 FY27 results reflect a sustained quarter- over-quarter momentum driven by our stakeholders, customers and employees. We have delivered on our investor guidance and achieved meaningful improvements across all major financial ratios, proving the power of disciplined execution and operational efficiency. Having previously stressed the need for steady, well-directed strategic execution, we are glad to note our successful delivery. Our strong growth trajectory reflects substantial operational progress, which will become clear as we walk through the financial metrics. By now, I trust you have had the opportunity to examine our financial results and investor presentation, which were circulated after yesterday's Board meeting. Turning to the broader financial system, the Monetary Policy Committee maintained a neutral stance and kept the policy rate unchanged during its June, 2026 meeting. While the prolonged West Asia conflict escalates risk to growth and inflation, high frequency indicators show that domestic economic activity remains resilient. Private consumption is steady and fixed investment holds strong momentum despite cost pressures. Looking ahead, supply disruptions and elevated commodity prices could impact economic activity and a potentially deficient Southwest monsoon poses risk to agricultural demand. However, proactive mitigation measures like crop diversification and climate resilient practices alongside strong capacity utilization, healthy credit flows and government capex will continue to support investments. Given these heightened inflationary risks, the MPC is awaiting further clarity. Consequently, we maintain a measured cautious outlook, navigating these external dynamics with strict prudence while closely tracking inflation trajectories. Prior to discussing our business highlights, I am Page 2 of 14 The Karnataka Bank Limited July 30, 2026 pleased to formally introduce Mrs. Biji S S, who assumed charge as Executive Director of Karnataka Bank effective July 15, 2026. With a distinguished banking career spanning more than 30 years, her extensive experience will significantly strengthen the Bank's leadership team in the journey ahead. Let me now present the business highlights: Bank has achieved its highest ever aggregate business, which stood at INR1,97,007 crores as of June 30, 2026, up by 3% Q-o-Q from INR1,92,119 crores in March, 2026 and up by 11% Y-o-Y from INR1,77,509 crores in June, 2025. Gross Advances stood at INR86,610 crores as on 30th June, 2026, reflecting a Q-o-Q growth of 4% from INR83,340 crores as on 31st March, 2026 and a Y-o-Y growth of 17% from INR74,267 crores as on 30th June, 2025. Our overall strategy is to continue our focus on growing retail, Agri and MSME, which has grown from INR51,197 crores as on March, 2026 to INR53,172 crores as on 30th June, 2026. On a Q-o-Q basis, Retail, Agri and MSME segment during Q1 FY27 has grown by 4%, while mid-corporate advances have grown by around 5%, whereas on a Y-o-Y basis, RAM segment has grown by 12%, while mid-corporate advances have grown by around 15%. In absolute terms, MSME, housing, gold and vehicle loans have contributed around INR1,980 crores of growth to our retail segment during Q1 FY27. Going forward, our trajectory focuses on accelerating retail expansion and stabilizing the corporate portfolio by prioritizing high-quality, better-yielding assets. The Bank continues to reduce low-yield corporate exposure in accordance with our earlier stated strategy. We are systematically replacing the IBPC book with higher-yielding loans to drive margin expansion. IBPC portfolio, which was at INR1,618 crores as of March, 2026 has been brought down to INR1,375 crores as on June, 2026. Accordingly, around INR243 crores have been replaced during Q1 FY27. Aggregate deposits as on 30th June, 2026 was INR1,10,396 crores, reflecting a Q-o-Q growth of 1% over 31st March, 2026 at INR1,08,779 crores and a Y-o-Y growth of 7% over 30th June, 2025 at INR1,03,242 crores. CASA ratio as on June, 2026 was 32.42% and 33.61% as on March, 2026 as against 30.84% as on June, 2025. The percentage of bulk total deposits was 4.7% as on June, 2026 and 4.2% as on March, 2026 as against 5.4% as on June, 2025. The percentage of bulk to term deposits was 7% as on June, 2026 and 6.3% as on March, 2026 as against 7.9% as on June, 2025. Bank has continued to focus on shifting high-cost bulk deposits to granular retail deposits of less than INR3 crores. The retail term deposits that is less than INR3 crores has grown by 3% from INR67,648 crores as on March, 2026 to INR69,410 crores as on June, 2026. On a Y-o-Y basis, retail term deposits have grown by 6%. The Bank is working towards deliberately reducing its reliance on high-cost bulk deposits and ensure most renewals are executed at predefined card rates, thereby enabling tighter control over the overall cost of deposits. Page 3 of 14 The Karnataka Bank Limited July 30, 2026 CD ratio [Showing first 8,000 characters — download PDF for full document]