Canara Bank Q4FY results: Net profit rises 33% to Rs 5,004 crore

Canara Bank posted a 33 per cent YoY rise in Q4 net profit to Rs 5,004 crore as other income rose 22 per cent while margins came under pressure amid rate cut transmission

State-owned Canara Bank reported a 33 per cent year-on-year (YoY) growth in net profit at Rs 5,004 crore for the January–March quarter (Q4FY25), aided by a rise in other income amid pressure on the net interest margin.

 

In FY25, the bank posted a net profit of Rs 17,027 crore, up 17 per cent YoY. The lender’s shares closed 2 per cent higher at Rs 95.38 per share on the BSE.

 

Net interest income (NII) in Q4FY25 fell marginally by 1.44 per cent YoY to Rs 9,442 crore. The net interest margin (NIM) from domestic operations in Q4FY25 declined to 2.73 per cent from 3.07 per cent in the same period last year.

 

The bank’s other income—including fees, commissions and treasury earnings—expanded by 22 per cent YoY to Rs 6,351 crore. Fee-based income and treasury income rose by 20 per cent and 15 per cent, respectively. The board recommended a dividend of Rs 4 per share for FY25.

 

“Fee-based income and recoveries contributed to the higher bottom line. NII fell due to a cut in interest rates and, as per regulatory requirements, last year penal interest was reclassified under commission and other income, impacting the NII,” said K Satyanarayana Raju, managing director and chief executive officer, Canara Bank.

 

“We are looking at treasury income from a positive point of view. We expect it to boost our trading profit. And as interest rates fall, it will open room for arbitrage income also,” the bank's top management added.

 

The bank’s asset quality profile improved, with gross non-performing assets (NPAs) declining to 2.94 per cent as of 31 March 2025, from 4.23 per cent a year ago. Net NPAs declined to 0.70 per cent from 1.27 per cent in March 2024. The provision coverage ratio (PCR), including write-offs, stood at 92.70 per cent in March 2025.

 

Sequentially, slippages rose to Rs 2,655 crore from Rs 2,363 crore.

 

For FY26, the bank expects NIM to remain around 2.75–2.80 per cent, said Raju.

 

NIMs will continue to be under pressure owing to expectations of further rate cuts. The benefit of rate cuts has already been passed on to the external benchmark-linked loan book, while transmission to deposits will take at least six months, he added.

 

Canara Bank’s global advances increased by 11.74 per cent YoY. Domestic credit grew 11.06 per cent YoY to Rs 10 trillion. Retail advances and corporate loans registered YoY growth of 13.23 per cent and 9.83 per cent, respectively.

 

Global deposits rose by 11.01 per cent to Rs 14.06 trillion. Domestic deposits expanded by 9.56 per cent YoY to Rs 13.31 trillion. The share of low-cost deposits—Current Account and Savings Account (CASA)—stood at 31.17 per cent in March 2025.

 

Looking ahead, the bank expects deposits to grow around 9 per cent and credit by 10–11 per cent in FY26, the management said.