Business Standard

Canara Bank plans to transfer credit card portfolio to its subsidiary

At the end of October, Canara Bank's credit card in force was 820,672. CCSL reported a net profit of Rs 7.86 crore during the second quarter of the current financial year

Deposit-heavy banks will gain most from SBI's savings rate cut

Canbank Factors reported a net profit of Rs 3.60 crore in the second quarter of the current financial year

BS Reporter

Listen to This Article

State-run lender Canara Bank is planning to transfer its credit card business and other digital product portfolio to its unlisted subsidiary, Canbank Computer Services Ltd (CCSL), the bank informed the stock exchanges on Tuesday.

Canara Bank has a 69.14 per cent stake in CCSL, while the remaining is held by Bank of Baroda and DBS India. Canara Bank has said it plans to buy out the shares of the other two stakeholders in CCSL.

“Canara Bank is holding 69.14 per cent shares in its unlisted subsidiary, Canbank Computer Services Ltd (CCSL), and proposes to buy out shares of other shareholders, i.e., Bank of Baroda (BOB) and DBS Bank India Ltd (DBIL). Canara Bank is also exploring transferring the credit card and other digital product portfolio of the Bank to CCSL,” Canara Bank said in a notification to the stock exchanges.

The move comes after the Reserve Bank of India (RBI) decided to increase risk weight earlier this month on unsecured loans like credit cards and personal loans. The regulator has been cautioning lenders on the high growth of unsecured loans.

At the end of October, Canara Bank's credit card in force was 820,672. CCSL reported a net profit of Rs 7.86 crore during the second quarter of the current financial year.

The Bengaluru-based lender also said that it has received Reserve Bank of India’s approval for divesting its stake in Canbank Factors Ltd. The bank has a 70 per cent stake in Canbank Factors.

“This is to inform the stock exchanges that RBI has accorded approval to the bank for divesting its shareholding (70 per cent) in its unlisted subsidiary, Canbank Factors Ltd. The bank is exploring/evaluating the procedures with regard to the same,” it said.

Canbank Factors reported a net profit of Rs 3.60 crore in the second quarter of the current financial year.

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Nov 28 2023 | 8:11 PM IST

Explore News