Tamilnad Mercantile Bank
NII growth improves as NIM rises: Interest income increased 16% to Rs 1550.38 crore, while interest expenses moved up 9% to Rs 845.93 crore in Q4FY2026. NII improved 24% to Rs 704.45 crore in Q4FY2026.
Margins improve: The bank has shown 20 bps YoY decline in cost of deposits to 5.71%, while yield on advances declined 29 bps YoY to 9.93% in Q4FY2026. NIM has improved 31 bps YoY to 4.18%, while rose 14 bps qoq to 4.18% in Q4FY2026.
Healthy growth in the non-interest income: The non-interest income of the bank increased 21% to Rs 241.76 crore in Q4FY2026.
Expense ratio improves: The operating expenses of the bank increased 16% to Rs 423.90 crore, as other expenses moved up 9% to Rs 203.22 crore, while employee expenses rose 24% to Rs 220.68 crore in Q4FY2026. Cost to income ratio improved to 44.8% in Q4FY2026 compared with 47.4% in Q4FY2025. Operating Profit moved up 29% to Rs 522.31 crore.
Provisions and contingencies increase: The bank has shown 9% increase in provisions to Rs 19 crore.
PBT increased 30% to Rs 503.52 crore in Q4FY2026. Effective tax rate increased to 25.8% in Q4FY2026 from 24.5% in Q4FY2025. Net Profit increased 28% YoY to Rs 373.65 crore in Q4FY2026.
Asset quality improves: The bank has improved asset quality in Q4FY2026.
The fresh slippages of loans stood at Rs 36.86 crore in Q4FY2026 compared with Rs 21.88 crore in previous quarter and Rs 54.45 crore in the corresponding quarter last year. The recoveries of NPAs stood at Rs 25.2 crore and upgrades were at Rs 2.61 crore, while the write-off of loans was at Rs 83.67 crore in Q4FY2026. The standard restructured loan book of the bank declined to Rs 218 crore end March 2026 compared to Rs 246 crore a quarter ago. Provision coverage ratio was strong at 96.14% at end March 2026 compared to 96.08% a quarter ago and 93.86% a year ago. The capital adequacy ratio of the bank stood at 33.7% with Tier I ratio at 32.3% at end March 2026.| Asset Quality Indicators: Tamilnad Mercantile Bank | |||||||
| ? | Mar-26 | Dec-25 | Sep-25 | Jun-25 | Mar-25 | Variation | |
| QoQ | YoY | ||||||
| Gross NPA (Rs Crore) | 388.21 | 462.83 | 474.45 | 549.12 | 556.13 | -16 | -30 |
| Net NPA (Rs Crore) | 97.41 | 100.08 | 121.52 | 147.37 | 160.45 | -3 | -39 |
| % Gross NPA | 0.73 | 0.91 | 1.01 | 1.22 | 1.25 | -18 | -52 |
| % Net NPA | 0.18 | 0.20 | 0.26 | 0.33 | 0.36 | -2 | -18 |
| % PCR | 96.14 | 96.08 | 95.30 | 94.32 | 93.86 | 6 | 228 |
| % CRAR - Basel III | 33.73 | 30.08 | 30.96 | 31.55 | 32.71 | 365 | 102 |
| % CRAR - Tier I - Basel III | 32.27 | 28.53 | 29.40 | 29.99 | 31.24 | 374 | 103 |
| Variation in basis points for figures given in percentages and in % for figures in Rs crore | |||||||
Business Highlights:
Business growth accelerates: The business of the bank has increased at an accelerated pace of 17% YoY to Rs 115091 crore end March 2026, as advances growth improved to 20% to Rs 53379 crore and deposits growth also moved up to 15% to Rs 61712 crore at end March 2026. With the faster growth in advances, the credit to deposit ratio rose to 86.5% at end March 2026 from 82.6% at end March 2025.
CASA deposits ratio improves: The CASA deposits of the bank increased 22% YoY to Rs 17365 crore at end March 2026. The current account deposits moved up 26% to Rs 5084 crore, while saving account deposits increased 21% to Rs 12281 crore end March 2026. The CASA ratio improved to 28.1% at end March 2026 compared to 26.4% at end March 2025, while increased from 27.9% at end December 2025. The term deposits have increased 12% to Rs 44347 crore end March 2026.
Strong loan growth: Within the loan book, the retail loans increased 62% YoY to Rs 14912 crore at end March 2026, while credit to agriculture increased 8% to Rs 20084 crore and MSME credit increased 15% to Rs 15532 crore. The corporate credit has declined 7% to Rs 2851 crore end March 2026. The share of retail, agriculture and MSME (RAM) improved to 94.7% at end March 2026 compared to 93.1% at end March 2025.
Investment book of the bank increased 4% YoY to Rs 15693 crore at end March 2026.
Branch expansion: The bank has added 8 branches in Q4FY2026, taking overall tally to 622 branches and 1151 ATM`s end March 2026.
Book value of the bank stood at Rs 638.5 per share at end March 2026, while the adjusted book value (net of NNPA and 10% of restructured advances) was Rs 630.9 per share at end March 2026.
Financial Performance FY2026:
Bank has posted 13% increase in net profit to Rs 1337.55 crore in the year ended March 2026 (FY2026). The net interest income increased 10% to Rs 2527.27 crore, while non-interest income moved up 3% to Rs 877.07 crore, leading net total income to increase 8% to Rs 3404.34 crore in FY2026. The operating expenses increased 10% to Rs 1549.11 crore, while provision and contingencies dipped 72% to Rs 48.63 crore. PBT increased 15% to Rs 1806.60 crore in FY2026. The cost-to-income ratio rose to 45.5% in FY2026 compared to 44.6% in FY2025. An effective tax rate rose to 26.0% in FY2026 compared to 24.9% in FY2025. The net profit has increased 13% to Rs 1337.55 crore in FY2026.| Tamilnad Mercantile Bank: Results | ||||||
| Particulars | 2603 (3) | 2503 (3) | Var % | 2603 (12) | 2503 (12) | Var % |
| Interest Earned | 1550.38 | 1341.68 | 16 | 5819.42 | 5291.26 | 10 |
| Interest Expended | 845.93 | 773.77 | 9 | 3292.15 | 2990.34 | 10 |
| Net Interest Income | 704.45 | 567.91 | 24 | 2527.27 | 2300.92 | 10 |
| Other Income | 241.76 | 200.38 | 21 | 877.07 | 850.49 | 3 |
| Net Total Income | 946.21 | 768.29 | 23 | 3404.34 | 3151.41 | 8 |
| Operating Expenses | 423.90 | 364.29 | 16 | 1549.11 | 1405.67 | 10 |
| Operating Profits | 522.31 | 404.00 | 29 | 1855.23 | 1745.74 | 6 |
| Provisions & Contingencies | 18.79 | 17.22 | 9 | 48.63 | 170.85 | -72 |
| Profit Before Tax | 503.52 | 386.78 | 30 | 1806.60 | 1574.89 | 15 |
| EO | 0.00 | 0.00 | - | 0.00 | 0.00 | - |
| PBT after EO | 503.52 | 386.78 | 30 | 1806.60 | 1574.89 | 15 |
| Provision for tax | 129.87 | 94.88 | 37 | 469.05 | 392.28 | 20 |
| PAT | 373.65 | 291.90 | 28 | 1337.55 | 1182.61 | 13 |
| EPS*(Rs) | 94.4 | 73.7 | ? | 84.5 | 74.7 | ? |
| Equity | 158.4 | 158.4 | ? | 158.4 | 158.4 | ? |
| Adj BV (Rs) | 630.9 | 556.7 | ? | 630.9 | 556.7 | ? |
| * EPS and Adj BV are calculated on diluted equity as given for each year. Face Value: Rs 10, Figures in Rs crore | ||||||
| Source: Capitaline Corporate Database | ||||||
