Higher provisioning for non-performing assets has hit Canara Bank’s bottom line. The bank’s net profit fell 5.29 per cent to Rs 625.94 crore for the second quarter (Q2) of the current fiscal, compared with Rs 660.97 crore in the same period last year.
Total income of the bank grew 13.29 per cent, to Rs 10,427.48 crore compared with Rs 9,203.61 crore recorded in the same quarter last year. EPS stood at 14.13 as against 14.92 last year.
Announcing the bank’s results, R. K. Dubey, CMD, Canara Bank, said profits were hit due to low recovery in government securities (bonds) and higher provisioning for NPAs.
“The quarter also saw record cash recovery at Rs 1,923 crore while the low base rate was able to see good growth in credit off-take,” he added.
Provisions (other than tax) and contingencies increased to Rs 674.03 crore from Rs 421.12 crore in the corresponding quarter of the previous year.
Net interest income
Operating profit was up 11.15 per cent at Rs 1,425 crore as against Rs 1,282 crore recorded in the same period last year. Bank’s non-interest income grew by 54.57 per cent to Rs 2,011 crore compared to Rs 1,301 crore .
Net Interest Income (NII) for the quarter increased by 11.96 per cent to Rs 2,191 crore from Rs 1,957 crore . Net Interest Margin (NIM) was at 2.22 per cent compared to 2.35 per cent in the corresponding quarter of the previous year.
Gross NPA was Rs 7,475.07 crore (Rs 5,609.53 crore). Net NPA was at Rs 6,459.30 crore (Rs 4,568.57 crore). Total deposits touched Rs 391,613 crore, with 16.3 per cent year-on-year growth compared to Rs 336,762 crore as at September 2012. Canara Bank’s Board of Directors at its meeting today approved a proposal regarding raising of capital by way of preferential allotment of equity shares amounting to Rs 500 crore to the Government .