Canara Bank profit rises 11.9%
However, the state-owned bank’s gross non-performing assets rises 18.59% to Rs. 44,659.56 crore
Canara Bank’s net profit for the three months ended June rose 11.87% to Rs. 281.49 crore year-on-year (y-o-y) on revenue of Rs. 1319.46 crore backed by a net interest income growth at 43.13%, according to a company statement.
“The NII growth is primarily due to the 15.12% y-o-y growth in domestic credit backed by a whopping 36.22% growth in retail credit which in turn has contributed to the 14.87% y-o-y increase in interest income from advances,” according to the statement.
While the total business of the bank registered a 10. 96% growth to Rs. 9.2 lakh crore, its domestic business grew by a higher 13.06% y-o-y to reach Rs. 8.63 lakh crore. The global deposits of the bank rose by 9. 75% while its domestic deposits increased by 11.62%.
At the same time, the state-owned bank’s gross non-performing assets rose 18.59% to Rs. 44,659.56 crore compared to Rs. 37657.76 crore during the same period a year earlier. Net NPA rose 9.84% to Rs. 26,693 crore from 24,300.63 crore.
CASA deposits posted a 9.1% y-o-y growth with the savings bank deposits registering, an 11. 75% y-o-y growth. The CASA ratio stood at 32.43%.
On the asset quality side, “signs of recovery were visible” with recovery and upgradations, backed by a 56% quarter-on-quarter improvement in cash recovery.
“The stressed assets ratio is sequentially down to 12.1 % from 12. 7% highlighting the consistent efforts of the bank in improving the asset quality. Further, the provision coverage ratio has improved to 60.69% from 54.52%,” according to the statement.
Further, the bank has calibrated its growth in the corporate sector by limiting its exposure to sectors under stress and incrementally growing only in those corporations, which are highly rated.
The Bengaluru-headquartered bank is “highly optimistic” about sustaining this growth momentum with present capital and potential business growth. “Comfortable capital position of the bank gives further impetus for taking lending into the next trajectory. Further, with the various steps already initiated for transformation, the management is hopeful of much-improved performance during 2018-19.”
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