Bangalore based Public Sector Lender Canara Bank’s net profit surged by an impressive 75 percent, amounting to Rs 3,535 crore for the June Quarter. This remarkable increase was attributed to a decline in bad loans and a notable growth in interest income. To put this into perspective, the bank had achieved a net profit of Rs 2,022 crore during the same period in the preceding year.
It delivered strong financial results for the first quarter of the fiscal year 2023-24. The bank’s total income in the mentioned quarter reached Rs 29,828 crore, showcasing significant growth compared to the previous year’s Rs 23,352 crore.
The bank’s interest earnings experienced a notable improvement, reaching Rs 25,004 crore in the June 2023 quarter, compared to Rs 18,177 crore in June 2022.
Its gross non-performing assets (NPAs) reduced to 5.15 percent of gross advances by the end of the June quarter, down from 6.98 percent in the corresponding period a year ago. Its net NPAs or bad loans also decreased to 1.57 percent from 2.48 percent during the same period.
Another positive indication of the improved asset quality is that the bank’s provision for bad loans decreased to Rs 2,418 crore in the June 2023 quarter, as compared to Rs 2,673 crore set aside in the corresponding quarter of the previous year.
Its Capital Adequacy Ratio saw an impressive increase to 16.24 percent at the end of June 2023, compared to 14.91 percent at the end of June 2022, indicating a strengthened financial position.
Furthermore, in anticipation of a proposed bipartite agreement in wage revision (scheduled from November 2022), the bank made an estimated provision of Rs 344.69 crore for the quarter ending on June 30, 2023.
However, the stock was down by 2.02% and closed at Rs. 332.85 on NSE on Tuesday.