Canara Bank Share Price news today :In a remarkable display of financial prowess, Canara Bank, one of India’s leading public sector lenders, reported a net profit of ₹3,534.8 crore for the quarter ended June 2023. This impressive figure marks a substantial 74.8% jump from the ₹2,022 crore recorded in the same quarter last year.
The bank’s exceptional performance was highlighted by significant increases in key financial indicators, including net interest income (NII) and pre-provision operating profit (PPOP). This article delves into the bank’s outstanding Q1FY24 results and analyzes the various factors contributing to its success.
The Surge in Net Interest Income (NII)
Canara Bank’s net interest income (NII), a critical metric that represents the difference between interest earned and interest expended, witnessed a substantial surge in Q1FY24. The NII increased by an impressive 27.7%, reaching ₹8,665.7 crore as compared to ₹6,784.7 crore in the corresponding quarter last year. This remarkable growth in NII underscores the bank’s ability to efficiently manage its interest earnings and expenses.
Steady Growth in Pre-Provision Operating Profit (PPOP) in Canara Bank Share Price
The bank’s pre-provision operating profit (PPOP) also showcased a significant increase in Q1FY24. It rose to ₹7,604.02 crore from ₹6,606.23 crore, representing a YoY growth of 15.1%. This notable expansion in PPOP exemplifies Canara Bank’s strong operational efficiency and strategic management, enabling it to generate higher profits before accounting for provisions and contingencies.
Decline in Credit Cost and Provisions
Canara Bank Share Price exhibited prudent risk management, as evidenced by the decline in credit cost. The credit cost decreased to 1.10% in Q1FY24 from 1.17% in the previous quarter and 1.38% in the same quarter last year. This reduction in credit cost reflects the bank’s proactive approach in managing loan losses and containing credit risk.
Furthermore, the Canara Bank Share Price provisions for the quarter decreased to ₹2,718.93 crore in Q1FY24 from ₹3,094.95 crore in the previous quarter and ₹3,690.05 crore in the corresponding quarter of the previous year. The decline in provisions is a testament to Canara Bank’s improving asset quality and the efficacy of its risk management practices.
Improved Asset Quality
Canara Bank Share Price showcased a significant improvement in asset quality during the first quarter of FY24. The bank’s Gross Non-Performing Assets (NPA) ratio declined by 20 basis points (bps) to 5.15% in the June quarter from 5.35% in the March quarter. Additionally, the Net NPA ratio fell by 16 bps to 1.57% sequentially from 1.73%. This enhancement in asset quality is a positive indication of the bank’s efforts to address and manage its non-performing assets effectively.
Easing of Gross and Net NPAs
On an absolute basis, Canara Bank Share Price Gross NPA in Q1FY24 eased by 0.9% to ₹45,727.4 crore from ₹46,159.5 crore in the previous quarter. Similarly, Net NPA fell by 6.2% to ₹13,461.4 crore from ₹14,349.3 crore, quarter on quarter. These reductions in both Gross and Net NPAs signify the bank’s success in resolving and recovering bad loans.
Slippages and Provision Coverage Ratio
Slippages, which represent loans turning into non-performing assets, increased to ₹3,428 crore in the quarter ended June 2023 from ₹2,973 crore in the previous quarter. Despite this rise, Canara Bank maintained a healthy Provision Coverage Ratio (PCR) of 88.04%, reflecting its ability to set aside adequate provisions to cover potential loan losses.
Capital Adequacy Ratio and Deposits
Canara Bank Share Price Capital Adequacy Ratio in Q1FY24 stood at 16.24%, indicating a strong capital position to support its operations and growth. The bank’s total domestic deposits at the end of March 2023 increased by 4.9% to ₹11,04,506 crore from ₹10,52,907 crore in the previous year. Furthermore, its global deposits rose by 6.5% year on year, reaching ₹11,92,470 crore.
Impressive Loan Book Growth
Canara Bank’s loan book demonstrated robust growth in Q1FY24. Gross global advances rose by 13.27% year on year, reaching ₹8,87,671 crore, while domestic gross advances witnessed a growth of 12.69% year on year, reaching ₹8,43,063 crore. These impressive figures indicate the bank’s strong lending activities and its ability to capture opportunities in the market.
Positive Stock Performance
Investors responded positively to Canara Bank Share Price outstanding Q1FY24 results, leading to a surge in the bank’s stock price. At 1:35 pm, the shares of Canara Bank were trading 2.94% higher at ₹348.00 apiece on the BSE. The stock reached a 52-week high of ₹351.30 per share after the Q1 results were announced, reflecting investors’ confidence in the bank’s financial performance and growth prospects.
Canara Bank’s remarkable performance in Q1FY24 is a testament to its strong fundamentals, prudent risk management, and customer-focused approach. The bank’s significant growth in net profit, net interest income, and pre-provision operating profit underscores its ability to navigate a dynamic economic landscape successfully. With improved asset quality and prudent provisioning, Canara Bank is well-positioned to drive sustainable growth and create long-term value for its stakeholders.
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What was Canara Bank’s net profit in Q1FY24?
Canara Bank reported a net profit of ₹3,534.8 crore in Q1FY24, witnessing a sharp 74.8% jump from the same quarter last year.
How did Canara Bank’s NII perform in Q1FY24?
Canara Bank’s NII increased by 27.7% in Q1FY24, reaching ₹8,665.7 crore as compared to ₹6,784.7 crore in the corresponding quarter last year.
Did Canara Bank’s asset quality improve in Q1FY24?
Yes, Canara Bank’s asset quality improved in Q1FY24. The Gross NPA ratio declined by 20 basis points to 5.15%, and the Net NPA ratio fell by 16 bps to 1.57% sequentially.
What was Canara Bank’s Provision Coverage Ratio (PCR) in Q1FY24?
Canara Bank’s Provision Coverage Ratio (PCR) was at 88.04% in Q1FY24, indicating its ability to set aside adequate provisions for potential loan losses.