Tamilnad Mercantile Bank Reports Strong Q4 FY26 Performance, Boosts Deposits and Advances

Tamilnad Mercantile Bank Reports Strong Q4 FY26 Performance, Boosts Deposits and Advances​

Tamilnad Mercantile Bank Ltd. (TMB), an established private sector bank with a 104-year history, has announced its audited financial results for the quarter and financial year ended March 31, 2026. The Board of Directors approved the results during a meeting held in Thoothukudi on April 27, 2026.

Shri. Salee S Nair, Managing Director and CEO of TMB, highlighted the company’s robust operational model, noting that the Q4 FY26 performance marked a defining quarter and achieved the bank's highest-ever quarterly profitability. He attributed the outcome to consistent execution and a balanced growth strategy.

During the quarter, the bank noted the resilience of its MSME franchise. Shri. Nair stated that credit demand from MSMEs remained stable, supporting lending momentum despite external headwinds. Furthermore, the bank observed sustained improvements in asset quality, reflecting disciplined underwriting and robust recovery efforts. Looking ahead to FY27, the bank plans to focus on scaling its MSME and retail businesses, deepening customer engagement, and leveraging digital capabilities.

Financial Growth Overview​

TMB reported significant year-on-year (YoY) growth across key business segments. Total Business grew by 17.37% to ₹1,15,091 crore (up from ₹98,055 crore in the previous year). Deposits saw a 14.94% increase, reaching ₹61,712 crore (from ₹53,689 crore). The bank’s CASA reached ₹17,365 crore, marking a 22.35% growth rate. Total Advances increased by 20.32% to ₹53,379 crore.

The bank reported a net profit of ₹1,337.55 crore, a 13.10% surge from ₹1,182.61 crore in the previous year. Operating profit increased to ₹1,855.23 crore, up 6.27% YoY.

The financial performance highlights are detailed below:

Key Financial Improvements​

The bank showcased marked improvements in asset quality and capital metrics. Net NPA decreased to 0.18% from 0.36%, an improvement of 18 basis points (bps). Gross NPA dropped to 0.73% from 1.25%, improving by 52 bps.

Other significant operational metrics included:

• CRAR: Increased to 33.73% from 32.71%, up 102 bps.
• Networth: Rose to ₹10,110 crore, marking an absolute rise of ₹1,101 crore.
• Total SMA to Gross Advances: Reduced to 1.29% from 2.55%, down 126 bps.
• Net Interest Income: Increased to ₹2,527.27 crore from ₹2,300.93 crore, growing 9.84% YoY.
• Net Interest Margin (NIM): Increased to 4.18% (QoQ) and 3.98% (YoY).
• Return on Equity (ROE): Stood at 13.99%, compared to 13.97% the previous year.

Business Expansion and Digital Initiatives​

In terms of physical expansion, the bank opened 44 new branches during FY26.

The bank also announced numerous strategic and technology-driven developments aimed at enhancing efficiency and customer experience. Key initiatives include:

• Integrating the Oracle CX platform to streamline the customer lifecycle.
• Implementing a Vendor Management System (VMS) for expense and tax compliance (GST, corporate tax).
• Adopting Business Process Management (BPM) for end-to-end digital workflows.
• Establishing an AI-enabled Call Centre for enhanced customer support.
• Deploying LOS & LMS (Phase I) for improved loan processing.
• Expanding digital services by enabling UPI on RuPay Credit Cards and facilitating port-related payments via Internet Banking.

Dividend Recommendation​

The Board of Directors recommended the payment of a final dividend of ₹12.50 per equity share, against a face value of ₹10, for the financial year 2025-26, pending approval from shareholders at the ensuing Annual General Meeting (AGM).

TMB Stock Price Movement​

Today, Tamilnad Mercantile Bank Limited shares edged higher to close at ₹697.3, posting a 7.52% gain for the day. The stock hit its 52-week high of ₹725, underpinned by substantial trading volume reaching 7.00 million shares.