Monday, July 19, 2010
CANARA BANK = Q 1 FY 2011 RESULT = EXCELLENT PROGRESS
Q/E JUNE 2010
Riding on High Growth Trajectory- Consistent Growth in Business and Profit
NIM crosses the 3% mark …at 3.01%
Return on Assets at 1.55%, above global benchmark of 1%
Both Gross NPA and Net NPA in absolute and ratio terms have come down compared to March 2010, Net NPA at 1%
Recovery and up-gradation together overshoot slippages.
CBS coverage increased to 2681 branches as on 16th July 2010, accounting for 96% of total business
All branches will be under CBS before 31st July 2010
Net Profit shot up to Rs.1013 Crore with a significant 82.5% growth compared to Rs.555 Crore posted in the corresponding quarter of previous financial.
Operating Profit of the Bank rose by 61% to Rs.1483 Crore as at June 2010 compared to Rs.921 crore a year ago.
Provision : The Bank made a total provision of Rs.470 crore, including a provision of Rs.131 Crore towards NPA. Provision Coverage Ratio improved to 78.01% as at June 2010.
Return on average assets (RoAA) : improved to a noteworthy 1.55% compared to 1.02% a year ago.
Earnings per Share rose to Rs.24.72,
Book Value increased to Rs.330.83 as at June 2010.
Capital Adequacy Ratio stood at 12.44%, well above the regulatory minimum of 9%. Tier I capital ratio improved to 8.10%. Given the still undiluted 73.17% Government of India holding, the Bank has large headroom available under both Tier I and Tier II options to raise capital and support business growth momentum.
Business Growth and Productivity : The Bank's aggregate business rose to a level of Rs.412649 crore as at June 2010, recording a robust growth of 23.4% y-o-y. The aggregate deposits reached Rs.238855 crore, up from Rs.193657 crore as at June 2009, with a growth of 23.3%.
Advances (net) reached a level of Rs.173794 Crore, up from Rs.140668 Crore as at June 2009, indicating a growth of 23.6%.
Domestic business constituted 96.6% of the aggregate business with Rs.232226 Crore under deposits and Rs.166215 Crore under advances.
CASA deposits grew by 28.8% to reach Rs.69350 Crore. CASA share in domestic deposits was close to 30%. SB deposits of the Bank recorded a healthy growth of 28.3% to touch Rs.53565 Crore. Credit to deposit ratio improved to 72.76%.
Business per Employee increased to Rs.10.17 crore, Business per Branch improved to Rs.134.81 crore as at June 2010 compared to Rs.122.06 crore as at June 2009.
Income and Expenses :
Driven by a 55% growth in non-interest income, the Bank’s total income reached Rs.5895 crore. The Bank's non-interest income reached Rs.734 crore compared to Rs.474 crore a year ago.
Net interest income rose to Rs.1728 crore, recording a robust 33.8% growth from Rs.1291 crore a year ago. As a result, the Bank’s Net Interest Margin (NIM) significantly jumped to 3.01% from 2.70% in the previous year, an increase of 31 bps.
The Bank’s gross NPA ratio came down to 1.46% (Rs.2549 crore) and net NPA ratio to 1.00% (Rs.1729 crore) as at June 2010 as against the gross NPA ratio of 1.74% and Net NPA ratio of 1.29% during corresponding quarter last year. Cash recovery increased to Rs.401 crore compared to Rs.245 crore a year ago.
Delivery Channels and InfoTech Advancement
Continuing with the branch expansion drive, the Bank opened 14 domestic branches, one overseas branch at Leicester, UK and a Representative Office at Sharjah, UAE during the quarter, taking the total tally under the branch network to 3061 branches. The Bank has identified 200 potential centres for opening branches during the current financial year.
Number of branches under Core Banking Solution increased to 2681 as on 16th July 2010, accounting for 96% of the Bank's total business. All branches will be brought under CBS before 31st July 2010. With over 2000 ATMs, the Bank’s debit card base rose to 55.50 lakh. The number of branches offering Internet and Mobile Banking (IMB) services expanded to 2681 branches.
Goals for FY11:
The Bank aims to reach an aggregate business figure of Rs.5 lakh crore, comprising total deposits of Rs.285000 crore and advances of Rs.215000 Crore.
The Bank will continue to focus on core business, with the objective of augmenting profits and profitability.
The Bank has plans to open over 200 new branches during FY2011.
(Amt. in Rs. Cr)
QOQ : Jun’08 : Jun’09 :Jun’10 :Growth %
Net Profit :: 123 ::555 ::1013:: 82.5
Operating Profit ::704 :: 921:: 1483 :: 61.0
Net Interest Income ::1019 ::1291::1728 :: 33.8
Total Business :: 266122::334325::412649::23.4
Total Deposits::156295 ::193657::238855:: 23.3
Net Advances ::109827::140668::173794:: 23.6
Branch Network:: 2696 ::2739 :: 3061:: +322
The Basic EPS for previous 5 quarters was – Rs.12.27(Q/E March 2010); Rs.25.67 (Dec 2009); Rs.22.21 (Sep2009); Rs. 13.54 (June2009); Rs.17.53 (Mar 2009); For current Quarter, EPS is 24.72.
At the current rate of growth, Canara Bank may clock an annual EPS of around Rs.100 for FY2011. At Rs.495/- current Market Price - the PE Ratio is hardly 4.95 – which leaves HUGE ROOM for appreciation.
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