Canara Bank Q2 net down 22.4%

 Hit by decline in net interest income, poor credit offtake, higher provisioning and slippages in large loans, Canara Bank on Tuesday announced a 22.4 per cent drop in net profit at Rs 660.97 crore for the second quarter ended September 30, 2012.

The bank had logged a net profit of Rs 852.22 crore during the corresponding period last year.   The bank’s profit also suffered due to higher operating expenses, which rose to Rs 1,282.78 crore during the quarter, up 7.66 per cent against Rs 1,184.62 crore incurred in the same period last year. Other income at Rs 608.07 crore (Rs 822.80 crore) represented a fall of 26.09 per cent.

The bank’s net interest income (NII) was Rs 1,957 crore in the current quarter as compared with Rs 1,962 crore a year ago, down 0.25 per cent. The net interest margin dipped to 2.35 per cent from 2.51 per cent in the second quarter of last fiscal. The bank’s total income for the quarter was however up 9 per cent to Rs 9,204 crore from Rs 8,437 crore in the same period last year.

Briefing reporters, Executive Directors A K Gupta & Archana S Bhargava cited general slowdown in the economy, sluggish credit offtake, decline in interest income and net interest income, slippages in large loans which constituted nearly Rs 1,245 crore out of the total Rs 1,921 crore, in the reporting quarter, as responsible for the decline in net profit.

Archana Bhargava said the slippages, especially of the five larger loan portofolios, which include Deccan Chronicle and Shakti Sugars, were beyond bank’s control, leading to higher provisionings. On restructured loans, Archana Bhargava said, “We have restructured accounts involving Rs 600 crore during the quarter.”

The net  NPA worsened to 2.12 per cent for the quarter ended September 30, 201 as against 1.66 per cent in first quarter and 1.42 per cent on a y-o-y basis. In absolute terms, net NPA during the current quarter stood at Rs 4,569 crore (Rs 3,100 crore). Gross NPA stood at 2.58 per cent compared to 1.98 per cent in the first quarter this fiscal and 1.75 per cent in the corresponding quarter last fiscal. In absolute terms, gross NPA stood at Rs 5,610 crore (Rs 3,828 crore). The bank made a cash recovery of Rs 885 crore during the current quarter.

Assembly elections 2019 | Get the latest news, views and analysis on elections in Haryana and Maharashtra on

For election-related news in Maharashtra, click here

For election-related news in Haryana, click here

DH Newsletter Privacy Policy Get top news in your inbox daily
Comments (+)