City Union Bank Q4FY26: Profit +25%, 1:3 bonus, ₹2 dividend

Shares jump after results and corporate actions

City Union Bank shares gained sharply in trade after the lender reported a strong March-quarter performance and announced shareholder payouts. The stock climbed as much as 8% in Tuesday’s session following the Q4FY26 results. City Union Bank also recommended a dividend of ₹2 per equity share and proposed a bonus issue in the ratio of 1:3. Investors tracked the move closely because the corporate actions came alongside the bank’s highest-ever quarterly profit, as described by the lender. The record date for both the dividend and the bonus issue has not been announced yet. Both proposals are subject to shareholder approval at the upcoming annual general meeting (AGM).

City Union Bank share price: what the market did

On the National Stock Exchange (NSE), City Union Bank shares opened at ₹281.52 and hit an intraday high of ₹293.52 in early deals. By 9:25 AM, the stock was trading at ₹282.35, up about 4% on the day, with 3.5 million shares changing hands. Separately, another market update around the results showed the stock at ₹271.21, up 3.31%, after touching ₹274.50. Ahead of the results announcement, the stock had closed at ₹272.50 on the NSE, up 3.81% in that session. Over longer periods, the stock was reported to have returned 17.64% over six months and 52.65% over one year. The bank’s market capitalisation was reported at about ₹20,170 crore.

Q4FY26 profit rises 25% YoY to ₹360 crore

For Q4FY26, City Union Bank reported net profit of ₹360 crore, up 25% year on year. The bank had posted ₹288 crore in the same quarter last year. The lender said this was the highest profit it has achieved in a single quarter. Profit before tax in one report was ₹459.56 crore versus ₹362.96 crore a year ago. Operating profit before provisions and contingencies was reported at ₹579.56 crore for the quarter, compared with ₹440.96 crore in Q4FY25. Another quarterly snapshot reported revenue of ₹1,855 crore versus ₹1,533 crore in the year-ago quarter. Total income was also reported at ₹2,146.09 crore in Q4FY26 compared with ₹1,783.94 crore in Q4FY25.

Core income: NII up 31% YoY

The bank’s net interest income (NII) grew 31% year on year to ₹786 crore in Q4FY26. NII in the March quarter of FY25 stood at ₹600 crore. This metric is closely tracked because it reflects the spread between interest earned and interest paid and is a key driver for bank profitability. Alongside NII, the bank’s non-interest income in Q4FY26 came in at ₹290 crore, compared with ₹251 crore in the corresponding quarter of the previous fiscal. Operating expense for the quarter stood at ₹497 crore. Gross profit improved 31% year on year to ₹580 crore.

FY26 performance: profit and balance sheet growth

For the full year FY26, City Union Bank reported net profit of ₹1,326 crore, up 18% from ₹1,124 crore in FY25. Another detailed disclosure put the annual net profit at ₹1,326.23 crore versus ₹1,123.62 crore. Total income for FY26 was reported at ₹7,904.55 crore in one market note, while another data point showed ₹7,908.59 crore. Deposits increased 23% year on year to ₹78,308 crore. Advances were reported at ₹65,875 crore for FY26 versus ₹52,081 crore a year ago. Net worth was reported at ₹10,458 crore as of March 2026.

Asset quality improves; provisions rise

The bank reported improvement in asset quality metrics, including sequential gains in the March quarter. Gross NPA ratio declined to 1.91% from 2.17% in the previous quarter, while net NPA ratio fell to 0.68% from 0.78%. In absolute terms, gross NPAs were reported at ₹1,273.08 crore versus ₹1,320 crore in the prior quarter. Net NPAs were reported at ₹449.42 crore compared with ₹469.34 crore. Provisions and contingencies rose to ₹120 crore, compared with ₹96 crore in the December quarter and ₹78 crore in the year-ago period. A separate annual comparison also indicated gross NPA at 1.91% as of March 31, 2026 versus 3.09% in the previous year, and net NPA at 0.68% versus 1.24%.

Dividend and bonus issue: what the board announced

City Union Bank recommended a dividend of ₹2 per equity share for FY2025-26, which it described as 200% on the face value of ₹1 per share. The bank also proposed issuance of bonus shares in the ratio of 1:3, meaning one equity share for every three fully paid-up equity shares held as on the record date. The bank has not announced the record date for either action yet. It stated that both the dividend payment and the bonus issue are subject to shareholder approval at the ensuing AGM. In an exchange filing, the bank reiterated the dividend recommendation and the 1:3 bonus ratio. Another note on the corporate action said the bonus shares would be received within two months from the date of board approval.

Analyst view: JM Financial keeps ‘Buy’, raises target

After the Q4 results, JM Financial maintained a ‘Buy’ rating on City Union Bank shares. The brokerage raised its target price to ₹320. The target implied nearly 14% upside from the then current market price (CMP), as per the report. Such post-results target revisions are typically linked to updated assumptions on profitability, growth, and asset quality trends. The bank’s quarterly print included strong year-on-year growth in profit and NII, and reported improvement in headline NPA ratios. Investors will still track how provisioning trends and loan growth evolve after the March quarter.

Key numbers at a glance

Bonus history and what comes next

As per BSE data cited in the reports, this is City Union Bank’s third bonus issuance. The bank had earlier issued bonus shares in 2017 and again in 2018. For the current proposal, the key pending item is the record date, which determines shareholder eligibility for the dividend and bonus shares. Shareholders will also watch for AGM outcomes since both actions require approval. On the operating side, the bank’s reported Q4 performance combined profit growth with stronger NII and improved asset quality ratios. The next set of disclosures around timelines and implementation will be important for investors tracking the corporate actions.