Canara Bank Q2 net down 15.4% at Rs 852.22 crore
Canara Bank, on Monday, announced a 15.44 per cent decline in its net profit at Rs 852.22 crore for the second quarter ended September 30, 2011 (Q2).
The bank had posted a net profit of Rs 1,007.88 crore in the July-September period of 2010.
However, the bank’s total income rose 39 per cent in Q2 to Rs 8,442.73 crore from Rs 6,077.06 crore in the same quarter last year.
Likewise, during the first six months of the current fiscal, the net profit fell by 21.93 per cent to Rs 1,578.07 crore from Rs 2,021.25 in the April-September period of 2010.
The bank’s total income during the first half rose to Rs 16,150.32 crore from Rs 11,971.91 crore in the same period last fiscal.
Briefing reporters, Chairman & Managing Director S Raman attributed the decline in the bank’s net profit to the higher provisions made by the bank towards net non-performing assets which have risen to Rs 3,116.99 crore in Q2 as against Rs 1,859.67 crore in Q2 last year. The bank, during the quarter made provisions to the tune of Rs 553.11 crore as against Rs 157.89 crore for the same period in previous fiscal.
However, Raman said, the bank was confident it will not allow any slippages in its NPAs adding that the high NPAs was due to the system-based migration mandated by RBI irrespective of size or category. The bank’s gross NPA ratio increased to 1.73 per cent in Q2 compared to gross NPA ratio of 1.49 per cent.
The bank, he said, was, however, able to make a record cash recovery at Rs 800 crore. During the first half of fiscal 2012 the cash recovery, he said, aggregated to a record Rs 1,558 crore, higher than Rs 742 crore in the same period a year ago.
Canara Bank’s total income grew 39 per cent driven by a 42 per cent growth in income from loans and advances to Rs 5,826 crore. The bank’s non-interest income rose by 56 per cent to Rs 828 crore compared to Rs 531 crore in the same quarter a year ago.
While total expenditure increased by 47 per cent, Raman said, mainly due to uptrend in interest cost, though operating expenses was contained at 9 per cent.
According to Raman, the bank’s interest expenditure was up by 58 per cent to Rs 5,653 crore as against Rs 3,574 crore in the same quarter previous fiscal, due to the strong need felt by the bank to increase deposit rates aggressively as there was large scale bidding for deposits by offering concessions and discounts.
Canara Bank’s global business during the reporting quarter rose to Rs 5,30,515 crore registering a year-on-year growth of 24.8 per cent against Rs 4,24,258 crore recorded in the fiscal 2010 same period.
While the bank’s total deposits increased to Rs 3,12,577 crore (25.4 per cent growth) it’s net advances grew by 23.8 per cent to touch Rs 2,17,938 crore. The bank’s CD ratio stood at 69.7 per cent. The bank’s capital adequacy ratio stood at 12.78 per cent.
