Tamilnad Mercantile Bank Q3 Results: Shares gain after profit, NII rise; NPAs ease

Tamilnad Mercantile Bank Ltd reported a healthy performance for the third quarter ended December 31, 2025, marked by steady earnings growth, improving asset quality and broad-based business expansion.

Net profit for the quarter rose 13.8% year-on-year to ₹341.5 crore, compared with ₹300.2 crore in the corresponding period last year. Net interest income (NII) increased 13.3% to ₹646 crore from ₹570.4 crore a year earlier, supported by growth in advances and deposits.

Asset quality indicators showed further improvement during the quarter. Gross non-performing assets (GNPA) declined sequentially to 0.91% from 1.01%, while net NPAs eased to 0.20% from 0.26% in the previous quarter.

Total business grew 14.28% year-on-year to ₹1.07 lakh crore, up from ₹94,042 crore in the year-ago quarter, and rose nearly 5% sequentially.

Deposits increased 12.53% to ₹56,707 crore, while advances climbed 16.30% to ₹50,763 crore. CASA deposits rose 14.93% year-on-year to ₹15,847 crore, reflecting stable granular funding.

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The provision coverage ratio strengthened to 96.08% with technical write-offs and 78.35% without write-offs, underscoring the bank’s conservative provisioning approach. The lender also continued to carry a COVID-related contingency provision of ₹250 crore on advances.

Shares of Tamilnad Mercantile Bank reacted positively post results, hitting an intraday high of ₹643.70 on the NSE before trading at ₹624.50, up 4.61%, as of 1:46 pm.