Karnataka Bank has appointed Parthasarathi Periaswamy as an Additional Director in the category of Non-Executive Independent Director, effective July 29, 2026. The Board of Directors approved the appointment during a meeting held on Wednesday, July 29, 2026, which commenced at 10:00 AM and concluded at 4:40 PM. This move strengthens the bank’s governance framework by adding a senior technology and cybersecurity leader to its board, addressing the growing importance of digital resilience in the financial sector.

The appointment is made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. As per regulatory requirements, the appointment is subject to the approval of the shareholders of the bank under the SEBI (LODR) Regulations, 2015 and applicable provisions of the Companies Act, 2013. The bank confirmed that Mr. Parthasarathi Periaswamy has not been debarred from holding the office of a director by any order passed by SEBI or any other authority, in compliance with BSE Circular No.: LIST/COMP/14/2018-19 dated June 20, 2018, and NSE Circular No.: NSE/CML/2018/24 dated June 20, 2018.

Profile and Expertise

Mr. Parthasarathi Periaswamy (DIN: 08507318) is appointed for a period of four years. He is described as a seasoned technology and cybersecurity leader with over three decades of experience at the highest levels of India's financial sector. His professional background includes serving as the former Chief Information Security Officer and Chief General Manager (IT) at the Reserve Bank of India (RBI). In this role, he played a pivotal part in shaping national cybersecurity frameworks, modernizing mission-critical infrastructure, and strengthening resilience across the banking ecosystem.

At the Institute for Development and Research in Banking Technology (IDRBT), Mr. Periaswamy served as Chief Technology Officer, where he directed IT infrastructure, trust services, and the national threat intelligence platform (IB CART). His leadership extended to convening the CISO Forum and organizing national cyber drills to foster collaboration and preparedness among banks. Beyond central banking, he has advised leading private sector banks on cybersecurity governance, policy reviews, and crisis management. He continues to contribute as a Consultant to the RBI Innovation Hub, guiding projects on cybersecurity in the financial sector, and serves as a Board Member of IFTAS, an RBI subsidiary, where he oversaw technology governance and sector-wide IT initiatives.

Governance Disclosures

In terms of SEBI Master Circular No.: SEBI/HO/49/14/14(7) 2025-CFD-POD2/I/3762/2026 dated January 30, 2026, the bank furnished details of the appointee in the annexure to the disclosure. The filing confirms that Mr. Parthasarathi Periaswamy is not related to any of the existing directors of the bank. The Company Secretary & Compliance Officer, Sham K Kanathila, signed the disclosure, which was submitted to both the National Stock Exchange of India Limited and BSE Limited on July 29, 2026.

Karnataka Bank reported a record-breaking start to the financial year, achieving its highest-ever quarterly net profit of ₹418.95 crore for Q1FY27, a 43% year-on-year increase. The lender also crossed the ₹2 lakh crore milestone with an all-time high aggregate business of ₹1,97,006.62 crore as of June 30, 2026. This performance underscores the bank's strengthening asset quality and margin expansion, driven by a 38 basis points improvement in Net Interest Margin (NIM) to 3.20%. The results signal robust operational efficiency and sustainable growth momentum for the financial institution.

The Board of Directors approved the unaudited standalone and consolidated financial results on July 29, 2026, at a meeting held in Mangaluru. The approval was made pursuant to Regulations 30, 33, 51, and 52 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were reviewed by the Audit Committee on July 28, 2026, and subjected to a limited review by the Joint Statutory Auditors, Ravi Rajan & Co. LLP and R.G.N. Price & Co., who issued an unmodified opinion.

Financial Performance

The bank's profitability was significantly bolstered by a sharp decline in provisioning costs and improved interest margins. Provisions (other than tax) and contingencies dropped to ₹28.70 crore in Q1FY27, compared to ₹110.80 crore in Q1FY26. This reduction contributed directly to the operating profit before provisions and contingencies, which stood at ₹580.34 crore, up 24.2% from ₹467.29 crore in the prior year period. Interest earned rose to ₹2,382.65 crore from ₹2,261.28 crore, while interest expended decreased slightly to ₹1,444.36 crore from ₹1,505.68 crore.

Asset quality metrics showed improvement on both a year-on-year and sequential basis. Gross Non-Performing Assets (GNPA) ratio declined to 2.58% from 3.46% in Q1FY26 (YoY) and from 2.78% in the previous quarter (QoQ). Net NPA (NNPA) ratio fell to 0.87% from 1.44% YoY and from 0.98% QoQ. The Provision Coverage Ratio (excluding Two-Opposite-View accounts) improved to 67.03% from 59.18%. The Capital Adequacy Ratio (CRAR) under Basel III norms stood at 21.10%, up from 20.46% in June 2025.

What the Numbers Show

The divergence between revenue growth and profit growth highlights the impact of lower credit costs on bottom-line performance. While total income grew by a modest 4.5%, net profit surged by over 43%, indicating that the primary driver of this quarter's results was the normalization of provisioning levels rather than top-line expansion. Additionally, the decline in interest expended despite higher interest earned suggests an improvement in NIM, which was reported at 3.20%. The sequential improvement in both GNPA and NNPA ratios further signals that stress in the loan book continues to resolve, reducing the need for aggressive provisioning. Return on Assets (ROA) improved to 1.29% from 0.97%, reflecting better capital efficiency.

Segmental Insights

Retail Banking remained the largest contributor to segment revenue at ₹1,265.74 crore, followed by Corporate Banking at ₹909.61 crore. Retail Banking's segment result improved significantly to ₹309.58 crore from ₹262.51 crore in Q1FY26. Treasury Operations contributed ₹73.99 crore to the segment result, down from ₹85.33 crore in the previous year. The bank transferred ₹127.00 crore from the Investment Fluctuation Reserve to Revenue Reserve during the quarter.

Aggregate Deposits stood at ₹1,10,396.41 crore, registering a 7% YoY growth. Retail Term Deposits (RTD) were ₹69,410.29 crore, a 6% YoY increase. Gross Advances stood at ₹86,610.21 crore, registering a 17% YoY growth. CASA balance grew 12.41% YoY to ₹35,787.30 crore, with the CASA ratio improving by 158 basis points to 32.42%.

Announcing the results, Managing Director & CEO Raghavendra S. Bhat highlighted the bank's commitment to sustainable growth and digital transformation. Executive Director Biji S. S. emphasized disciplined execution and prudent risk management as key drivers of the bank's progress.