Canara Bank net stays flat at Rs 613 cr in Q4

The lender achieved a credit growth of 9.6% during 2014-15

Bengaluru-based public sector lender Canara Bank’s net profit remained flat at Rs 613 crore for the fourth quarter ended March compared to Rs 611 crore in the corresponding quarter last year.

Total income of the bank increased seven per cent to Rs 12,429 crore as against Rs 11,610 crore in the year-ago quarter. The operating profit declined 7.9 per cent to Rs 1,733 crore from Rs 1,882 crore a year ago.

Despite lower provisions, the bank’s net profit came down. It was due to a decline in net interest income during the quarter. It stood at Rs 2,486 crore as against Rs 2,536 crore, a decline of two per cent year-on-year. The net interest margin for the quarter came down two basis points to 2.25 per cent from 2.27 per cent a year ago.

The bank made 7.4 per cent lower of provisions at Rs 1,010 crore as against Rs 1,091 crore in March 2014. Of this, provisions towards non-performing assets  stood at Rs 782 crore against Rs 802 crore in the fourth quarter of 2013-14. 

The gross NPA ratio was at 3.89 per cent from 2.49 per cent at March 2014. The net NPA ratio at 2.65 per cent from 1.98 per cent at March 2014. Cash recovery aggregated to a record level of Rs 5,993 crore compared to Rs 5,494 crore last year. Upgradation was Rs 2,031 crore compared to Rs 2,853 crore last year.

"During the fourth quarter ended March 2015, the bank saw fresh slippage of 2,804 crore. The bank witnessed stress in the areas of power, roads, steel and textile sectors," P S Rawat, senior executive director and in-charge Managing Director and CEO said.

The return on assets has declined to 0.50 per cent from 0.54 per cent in March 2014.

The capital adequacy ratio as per Basel-III norms stood at 10.56 per cent. CET ratio at 7.37 per cent and Tier-I ratio of 8.02 per cent. “We have enough headroom available to raise capital to support business growth momentum. The Bank is in need of raising around Rs 3,000 crore to achieve a credit growth rate of 15 per cent during the current financial year. However, we have not taken a decision as to when to raise the capital,” Rawat said.

The Bank’s stock closed 3.71 per cent lower at Rs 340.20 per share on the close of trading on BSE.