Canara Bank

20 Oct 2022 , 07:09 PM

Canara Bank has reported robust 90% surge in net profit at Rs 2525.47 crore for the quarter ended September 2022 (Q2FY2023). The bank has posted healthy 18% growth in net interest income (NII), while the core fee income of the bank also improved 18% in Q2FY2023. The Net Interest Margin (NIM) of the bank improved to 2.86% in Q2FY2023 compared to 2.77% in the corresponding quarter of previous year. On business front, the bank as has posted 14% growth in business with strong 20% surge in loan book. The asset quality of the bank has improved in Q2FY2023. Bank has sharply improved the credit to deposit ratio to 72.7% at end September 2022 from 66.5% at end September 2021. The CASA ratio of the bank has eased to 31.7% at end September 2022 from 32.4% at end September 2021. Asset quality improves: The bank has exhibited healthy improvement in the asset quality in Q2FY2023. The fresh slippages of loans stood at Rs 3948 crore in Q2FY2023 compared with 3949 crore in previous quarter and Rs 6896 crore in the corresponding quarter last year. The recoveries of NPAs stood at Rs 1876 crore, upgradations at Rs 1523 crore and the write-off of loans was at Rs 2798 crore in Q2FY2023. The recoveries of NPAs was higher at Rs 6197 crore than slippages of Rs 3498 crore in Q2FY2023. The segment GNPA ratio for retail loans stood at 1.77% (with housing at 0.77%, vehicle loans 1.63% and other personal loans 1.32%), agriculture 4.15%, MSME 10.35% and corporate at 8.02% end September 2022. Industry wise GNPA ratio for infrastructure stood at 6.79%, iron & steel at 5.26%, textiles at 7.37%, food processing at 9.62% engineering 7.66% end September 2022. The SMA 2 category loan book of the bank has declined to 0.1% end September 2022 from 0.19% end June 2022. Provision coverage ratio was steady at 85.36% at end September 2022 compared to 84.51% a quarter ago and 82.44% a year ago. The capital adequacy ratio of the bank stood at 16.5% with Tier I ratio at 13.4% at end September 2022.

Asset Quality Indicators: Canara Bank
?	Sep-22	Jun-22	Mar-22	Dec-21	Sep-21	Variation
QoQ	YTD	YoY
Gross NPA (Rs crore)	52485.14	54733.88	55651.58	56893.30	57853.09	-4	-6	-9
Net NPA (Rs crore)	17286.13	18504.93	18668.02	19819.28	20861.99	-7	-7	-17
% Gross NPA	6.37	6.98	7.51	7.80	8.42	-61	-114	-205
% Net NPA	2.19	2.48	2.65	2.86	3.21	-29	-46	-102
% PCR	85.36	84.51	84.17	83.26	82.44	85	119	292
% CRAR – Basel III	16.51	14.91	14.90	14.80	14.37	160	161	214
% CRAR – Tier I – Basel III	13.40	12.13	11.91	11.58	11.41	127	149	199
Variation in basis points for figures given in percentages and in % for figures in Rs crore

? Business Highlights: Healthy business growth: The business of the bank has increased 14% YoY to Rs 1958111 crore end September 2022, driven by 20% surge in advances to Rs 824147 crore. Deposits also increased 10% to Rs 1133964 crore at end September 2022. CASA deposits ratio eases: The CASA deposits of the bank rose 7% YoY to Rs 359460 crore at end September 2022. The CASA ratio declined to 31.7% at end September 2022 compared to 32.4% at end September 2021 and 32.3% end June 2022. Strong loan growth: Advances growth was driven by retail loans rising 13% YoY to Rs 134051 crore at end September 2022, while credit to agriculture increased 22% to Rs 196576 crore and MSME 13% to Rs 124295 crore at end September 2022. The corporate credit has zoomed 25% to Rs 369225 crore end September 2022. Investment book of the bank expanded 9% YoY to Rs 314245 crore at end September 2022. The AFS book dipped -25% to Rs 54301 crore, while HTM book jumped 21% to Rs 257226 crore at end September 2022. Margins improve: The bank has showed 8 bps YoY rise in cost of deposits to 3.75%, while yield on advances moved up 12 bps YoY to 7.24% in Q2FY2023. Thus, the NIM has improved 9 bps YoY to 2.86%. Branch expansion: The bank has reduced 10 branches and 43 ATMs in Q2FY2023, taking overall tally to 18631 branches and 10759 ATM`s end September 2022. Book value of the bank stood at Rs 341.9 per share at end September 2022, while the adjusted book value (net of NNPA and 25% of restructured advances) was Rs 218.5 per share at end September 2022. Quarterly Performance NII rises as NIM improves: Bank has recorded 18% increase in the interest earned at Rs 20106.93 crore, while interest expenses increased 17% to Rs 12673.10 crore in Q2FY2023. NII improved 18% to Rs 7433.83 crore in the quarter ended September 2022. Strong growth in the core fee income: Bank has posted strong 18% growth in core fee income to Rs 1726 crore, while the recoveries and other income jumped 164% to Rs 1231 crore. However, the forex income declined -57% to Rs 257 crore and treasury income also dipped -59% to Rs 467 crore. The overall non-interest income increased 13% to Rs 4825.27 crore in the quarter ended September 2022. Expenses ratio improves: The operating expenses of the bank increased 8% to Rs 5353.62 crore, as other expenses moved up 24% to Rs 2234.15 crore, while employee expenses fell -1% to Rs 3119.47 crore in Q2FY2023. Cost to income ratio improved to 43.7% in Q2FY2023 compared with 46.8% in Q2FY2022, helping the Operating Profit to increase 23% to Rs 6905.48 crore. Provisions and contingencies up: The bank has showed 8% rise in provisions to Rs 3636.81 crore. The loan loss provisions rose 3% to Rs 2745.00 crore, while investment provisions jumped 139% to Rs 526 crore and standard asset provisions rebounded to Rs 119 crore. Other provisions dipped -48% to Rs 247 crore. Effective tax rate declined to 22.7% in Q2FY2023 from 40.6% in Q2FY2022. Net Profit jumped by 90% YoY to Rs 2525.47 crore during quarter ended September 2022. Financial Performance H1FY2023: Bank has posted 81% increase in net profit to Rs 4547.50 crore in the year half year ended September 2022 (H1FY2023). The net interest income increased 14% to Rs 14218.55 crore, while non-interest income moved up 19% to Rs 10000.59 crore, pushing up net total income by 16% to Rs 24219.14 crore in H1FY2023. The operating expenses increased 10% to Rs 10707.43 crore, while provision and contingencies rose 7% to Rs 7326.86 crore, allowing profit before tax to increase 45% to Rs 6184.85 crore in H1FY2023. The cost-to-income ratio improved to 44.2% in H1FY2023 compared to 46.9% in H1FY2022. An effective tax rate declined to 26.5% in H1FY2023 compared to 41.2% in H1FY2022. The net profit has increased 81% to Rs 4547.50 crore in H1FY2023.

Canara Bank: Results
Particulars	2209 (3)	2109 (3)	Var %	2209 (6)	2109 (6)	Var %	2203 (12)	2103 (12)	Var %
Interest Earned	20106.93	17063.69	18	38283.56	33848.06	13	69410.25	69280.46	0
Interest Expended	12673.10	10789.88	17	24065.01	21414.92	12	43026.26	45177.62	-5
Net Interest Income	7433.83	6273.81	18	14218.55	12433.14	14	26383.99	24102.84	9
Other Income	4825.27	4267.80	13	10000.59	8423.71	19	16496.90	14924.32	11
Net Total Income	12259.10	10541.61	16	24219.14	20856.85	16	42880.89	39027.16	10
Operating Expenses	5353.62	4937.97	8	10707.43	9772.33	10	21146.81	19338.19	9
Operating Profits	6905.48	5603.64	23	13511.71	11084.52	22	21734.08	19688.97	10
Provisions & Contingencies	3636.81	3360.23	8	7326.86	6818.97	7	12772.49	15981.75	-20
Profit Before Tax	3268.67	2243.41	46	6184.85	4265.55	45	8961.59	3707.22	142
Provision for tax	743.20	910.80	-18	1637.35	1755.47	-7	3283.17	1149.64	186
PAT	2525.47	1332.61	90	4547.50	2510.08	81	5678.42	2557.58	122
EPS*(Rs)	55.7	29.4	?	50.1	27.7	?	31.3	14.1	?
Adj BV (Rs)	218.5	164.8	?	218.5	164.8	?	188.1	151.5	?
* Annualized on current equity of Rs 1814.13 crore. Face Value: Rs 10, Figures in Rs crore
Source: Capitaline Corporate Database

?Powered by Capital Market – Live News