TMB Q3 results: Net profit up 14% at ₹342 crore, asset quality improves

Tamilnad Mercantile Bank posts record ₹342 crore Q3 FY26 profit, driven by strong business growth, improved asset quality and rising MSME and retail lending

Thoothukudi-based Tamilnad Mercantile Bank (TMB) has posted its highest-ever net profit of ₹342 crore during the third quarter of 2025-26, up 14 per cent from ₹300 crore during the same period last fiscal.

 

This was driven by a growth of 14.28 per cent in total business, and improved asset quality. The bank’s net interest income was at ₹646.14 crore for the quarter Q3FY26 as against ₹570.39 crore for Q3FY25, registering a growth rate of 13.28 per cent.

 

Its asset quality during the quarter improved, with the gross non-performing assets (NPA) seen at 0.91 per cent from 1.32 per cent, improving by 41 basis points (bps). Net NPA has decreased to 0.2 per cent from 0.41 per cent, improving by 21 bps.

 

 

The bank’s total business grew by 14.28 per cent on a year-on-year (Y-o-Y) basis to ₹1.07 trillion versus ₹94,042 crore last year. Deposits grew by 12.53 per cent to ₹56,707 crore in Q3FY26 compared to ₹50,392 crore in Q3FY25.

 

The bank’s current account and savings account (Casa) has increased to ₹15,847 crore against ₹13,788 crore last year, with a growth rate of 14.93 per cent. The advance level of the bank has increased to ₹50,763 crore with a growth rate of 16.3 per cent. “This growth translated into our highest-ever net profit. Our return on assets was at 1.97 per cent and return on equity at 14.22 per cent, against 1.89 per cent and 14.44 per cent respectively last year,” said Salee S Nair, managing director and chief executive officer, Tamilnad Mercantile Bank.

 

“Our Q3FY26 performance reinforces the progress we are making in a year focused on building long-term capability and scalable growth. The bank delivered healthy growth in advances and deposits, with resilience in profitability and continued strength in asset quality, reflecting disciplined execution across the organisation,” he added. 

 

Nair said that the bank is expecting a growth of over 15 per cent in total business during the current financial year, with deposit growth of around 13-13.5 per cent and advances growth of over 16 per cent.

 

Operating profit during the third quarter surged to ₹468 crore from ₹408 crore, up by 15 per cent. The retail, agriculture, and MSME (RAM) segment has increased to 93.98 per cent for Q3FY26 as against 92.39 per cent for Q3FY25. In the advances portfolio, RAM grew by 18.29 per cent. “We are focusing a lot on MSMEs through credit management centres. MSMEs grew by 8.43 per cent versus last year,” Nair added.

 

“MSME lending remains a core growth driver for us. During the quarter, we saw improving momentum in MSME credit, supported by stronger engagement in trade-linked and manufacturing clusters. Developments around the US-India trade engagement are constructive for export-oriented MSMEs, particularly in sectors such as textiles, engineering and electronics, where Tamil Nadu has a strong presence. We are seeing early signs of improved demand for working capital, trade finance and forex solutions from these enterprises,” he added.