Tamilnad Mercantile Bank reported its highest-ever quarterly net profit of Rs 451 crore for July–September 2026, up 42% from Rs 317 crore a year earlier. The Tamil Nadu-based private lender announced the Q2 FY27 results on October 26, with management attributing the improvement to higher net interest income and cost containment.

Tamilnad Mercantile Bank earnings gain from interest income

Interest income increased 29% to Rs 1,820 crore from Rs 1,413 crore in the corresponding quarter of FY26. Net interest income reached Rs 807 crore, which Managing Director and CEO Salee Sukumaran Nair identified as a driver of operating profit and net profit.

Net interest income measures interest earned after deducting interest paid on deposits and other funding. It is therefore distinct from the bank’s larger interest-income figure.

Nair said the bank recorded year-on-year business growth of 27.25%, its fastest in 18 years. The lender reported a capital adequacy ratio of 32.39% and return on equity of 16.92% at the end of September.

Bad-loan ratio falls as bank plans 60 branches

Gross non-performing assets declined to 0.61% of gross advances in the September quarter, compared with 1.01% a year earlier. The lower ratio indicates that bad loans represented a smaller share of the bank’s advances.

The Reserve Bank of India’s October 2021 asset-classification framework explains non-performing assets and the computation of NPA levels. It provides historical methodological context, rather than verification of the bank’s September 2026 figures.

Nair also outlined plans to open 60 branches, including 20 outside Tamil Nadu. The expansion remains planned; no opening timetable was specified.

Tamilnad Mercantile Bank shares closed at Rs 804.60 on the BSE on October 26, up 0.47%.

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