A Canara Bank branch.
Credit: DH File Photo
Bengaluru: Bengaluru-based public sector lender Canara Bank’s net profit rose 11.3 per cent to Rs 4,014 crore for the July-September quarter (Q2FY25), compared to the same period last year, on the back of higher interest income and reduced toxic assets (NPAs).
This is also up by 2.79 per cent from its net profit of Rs 3,905 crore in the April-June quarter.
The bank’s total income rose 10.3 per cent to Rs 34,721 crore in the quarter year-on-year, and up 2.06 per cent sequentially. However, net interest margins (NIM) reduced to 2.88 per cent at the end of Q2, down from 3.02 per cent in Q2FY24 and 2.9 per cent the previous quarter.
The bank’s managing director and CEO, Satyanarayana Raju, attributed this to market conditions. At a media briefing, he said that unless the market improves, the improvement in NIM may not be that easy.
Total interest income came in at Rs 29,740 in Q2, up 10.81 per cent YoY.
The bank saw improvement in the asset quality front with gross Non-Performing Assets (NPAs) reaching 3.73 per cent in Q2, down from 4.76 per cent in the same period last year. Net NPAs also showed improvement, decreasing from 1.41 per cent as of September 2023 to 0.99 per cent as of September 2024.
Provision coverage ratio stood at 90.89 per cent, up from 88.73 per cent in the previous year as well as 89.22 per cent sequentially.
While the bank has been permitted to open 250 more branches, only 40-45 branches have been opened by September. By the end of the December quarter, they may open up to 200 branches, Raju said.