Thoothukudi (Tamil Nadu)-headquartered Tamilnad Mercantile Bank (TMB) is anticipating a 15-18 per cent growth in advances for FY26, largely driven by expected performance in the RAM (Retail, Agriculture, and MSME) sector. The old private sector bank has also rolled out three major initiatives, among others, to boost its CASA (Current Account Savings Account) share.
For FY25, TMB reported an 11 per cent increase in gross advances at ₹44,366 crore. “We have been strategically moderating the corporate portfolio. The RAM sector grew by 13.19 per cent and accounted for 93 per cent of gross advances in FY25. This remains the primary driver of our growth,” Salee S. Nair, Managing Director and CEO of TMB, said during a discussion.
MSME and retail segments are expected to be the main contributors to growth in FY26. “We faced some challenges last quarter as we adjusted to these changes, and we expect some of that pain to carry over into the first quarter of FY26. However, we anticipate a noticeable improvement in our ability to onboard customers, especially with a sharp reduction in turnaround time,” he added.
The bank has already identified a list of customers to onboard, including many who had previously left due to delays or the bank’s inability to provide timely solutions. “We’re working to rebuild those relationships. In fact, we’ve significantly expanded our relationship management team to help us tap into the market more effectively across both retail and MSME segments,” Nair stated.
On the technology front, TMB’s automation systems are nearly ready. Unlike in the past, many sanctions will now be processed within the department center itself.
On the deposit side, after facing some challenges with CASA, TMB has implemented several initiatives including the setting up a Transaction Business Unit focused on current accounts, establishing a Global NRI Centre to drive NRI deposits, and launching a High Net-Worth Services Group to focus on relationships with HNIs.
Despite an overall deposit growth of 8.43 per cent in FY25, TMB acknowledges it is still trailing the market. “However, the trend is improving, and we are confident that we will be aligned with the market in FY26,” Nair added.
The bank also has plans for footprint expansion, with plans to open 50 new branches this fiscal year, half of which will be located outside of Tamil Nadu.