Canara Bank sees 17-18% growth in loan
Canara Bank, with higher provisioning and slippages in large and mid corporate portfolio, has posted 2.17 per cent higher profits to Rs 792.07 crore for the first-quarter of fiscal 2013-14 compared with Rs 775.24 crore same period of the previous year.
Its total income for the quarter up 14.64 per cent to Rs 10,507.88 crore compared with Rs 9,165.47 crore same period last year, while EPS stood at Rs 17.88 (Rs 17.50).
R.K. Dubey, Chairman and Managing Director, told reporters here “Bank’s profits are low due to higher provisioning and slippages in few large corporate and mid-portfolio.”
Its operating profit before provisions and contingencies increased by 36.19 per cent to Rs 1,898.26 crore compared with Rs 1,393.77 crore last year. As for the bank’s asset quality, Gross non-performing asset (NPA) stood at Rs 7,328.88 crore (same period last year Rs 4,496.55 crore) and net NPA stood at Rs 6,209.17 crore (Rs 3,755.61 crore).
Net interest margin has come down to 2.21 per cent as compared with 2.26 per cent recorded last year. Net Interest Income (NII) is up 8 per cent to Rs 1,991 crore as compared with Rs 1,844 crore in the same period last year. Provisions and contingencies increased to Rs 1,106 crore (Rs 619 crore).
Its CASA deposits to domestic deposits marginally increased to 24.2 per cent in Q1 from 24 per cent recorded same period last year. The Credit Deposit ratio of the bank stood at 13.4 per cent.
Dubey said bank has shed nearly Rs 1 lakh crore since June 2012. With this CD ratio has come down drastically to 13.4 per cent from a high of 46 per cent. Cost of deposits of the bank is around 7.5 per cent and yield on advances is around 10.5 per cent.
The total business has gone up 12.8 per cent to touch Rs 6.32 lakh crore as on June 30, 2013. The deposits increased by 14.2 per cent to reach Rs 3.82 lakh crore. The advances (net) of the bank increased by 10.8 per cent to Rs 2.50 lakh crore.
Commenting on the bank’s results, Vaibhav Agrawal VP-Research, Banking, Angel Broking said “The Canara Bank witnessed significant asset quality deterioration during the quarter, as Gross and Net NPA levels increased sequentially by around 17 per cent each. We believe that asset quality pressures for the banking sector are unlikely to abate as quickly as was expected earlier, as we take into consideration the recent macro developments in an overall weak macro environment.”
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