An increase in provisions by about a fourth has resulted in Canara Bank posting a flat growth in net profit for the September quarter this year. The Bangalore-headquartered public sector bank reported a net profit of ₹627 crore, an increase of 0.16 per cent over corresponding last quarter’s ₹626 crore.
Operating profit for the quarter was up 14.1 per cent at ₹1,626 crore, while total provision were higher by 25 per cent at ₹999 crore.
Net interest income, the difference between interest earned and expended grew 8.1 per cent at ₹2,368 crore. Income from advances rose 14.9 per cent to ₹8,005 crore.
During the quarter, net advances were up 10.6 per cent during the quarter to ₹3.11 lakh crore, with the bank witnessing continued robust growth in its retail businesses. The retail lending portfolio was up 28 per cent at ₹38,884 crore with housing loans, vehicle loans and other personal loans driving growth. Credit advances to micro, small and medium enterprises was up 26.6 per cent, while its agriculture portfolio expanded 24.6 per cent.
Non-performing assets The gross NPAs stood at ₹9164 crore and the bank suffered a fresh slippage of ₹3,178 crore. Net NPA stood at ₹7,170 crore. “The fresh slippages were mainly from companies in sectors such as telecom and textiles,” said VS Krishna Kumar, Executive Director, Canara Bank. He further stated that the bank contained the gross NPA ratio at less than 3 per cent, despite the continuing stressed scenario at the industry level.
Canara Bank has increased the provision coverage ratio to 58.68 per cent from 57.77 per cent last year. The bank registered a record cash recovery of ₹1,194 crore during the quarter.