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Canara Bank has announced a strong performance in the September quarter of FY25, reporting an 11.31% year-on-year increase in net profit, reaching ₹4,014 crore. This marks a significant improvement compared to the ₹3,606 crore earned in the corresponding quarter of the previous fiscal year. The bank's robust performance can be attributed to a positive trend in its net interest income, which rose to ₹9,315 crore, exceeding the ₹8,903 crore recorded in the same period last year.
A notable factor contributing to Canara Bank's strong financial position is the successful recovery of a portion of its non-performing assets (NPAs). The bank managed to recover ₹500 crore during the quarter, representing a part of the total ₹11,777 crore it has under the National Company Law Tribunal (NCLT). These recoveries were achieved through liquidation activities and various settlements, highlighting the bank's proactive approach in addressing its asset quality challenges. The bank's focus on managing NPAs is evident in the significant reduction of NPAs in the MSME sector, which has nearly halved from 14% two years ago to 7.1% in the current quarter. Canara Bank's management expressed confidence in further stabilizing the MSME NPA ratio to 5% or below in the next one to two years.
Canara Bank has also taken measures to reduce its risk exposure in the microfinancing sector. The bank's outstanding in this sector has been significantly reduced from ₹600 crore to ₹300 crore, representing a 50% decrease. This strategic move reflects the bank's commitment to managing its risk profile effectively. In addition to its strong financial performance, Canara Bank is also expanding its operations. The bank plans to add 250 new branches to its existing network of 9,658 branches in the current fiscal year. This expansion strategy aims to enhance the bank's reach and accessibility for customers across the country.