Canara Bank net down 26.5%

BS 200 SCORECARD

Canara Bank has reported a net profit of Rs 274 crore for the three months to December 2004, down 26.5 per cent year on year, "chiefly due to a provision of Rs 150 crore towards increased pay of the bank's employees," V P Shetty chairman and managing directors told reporters here on Monday. Total income increased 6.34 per cent year on year to reach 2,231 crore.

During the quarter, the bank also "took a hit of some Rs 176 crore in depreciation," after shifting some of the government securities it held from available-for-sale category to held-to-maturity, Shetty said.

"That exercise was repeated on January 7 also which meant a further marked-to-market hit of Rs 200 crore" for the current quarter, he said.

At the end of the quarter the bank's non-performing assets (NPA) ratio stood at 2.93 per cent, compared with 4.05 per cent at the end of December 2003.

"We aim to end the fiscal year with an NPA ratio of 2.5 per cent," Shetty said. NPA on December 31, 2004 were Rs 1,566 crore, compared with Rs 1,498 crore at the end of September 2004.

During the quarter total income grew 1.1 per cent sequentially, while net income fell 31 per cent on the September quarter's profits of Rs 396.79 crore. Yield on advances for the quarter was 8.30 per cent and cost of deposits, 4.77 per cent. Return on assets, at 1.25 per cent, was lower by 18 basis points than during the September quarter and by 8 basis points year on year.

The bank aimed to end the year with total business of Rs 1,55,000 crore and retail lending would get particular focus: during the December quarter, disbursements grew 49.13 per cent year on year to Rs 4,013 crore. Total retail disbursals stood at Rs 10,093, up 46.85 per cent year on year.