Analyst Concall
Credit-deposit ratio up to 78% comfortable - Canara Bk MD
This story was originally published at 20:09 IST on 27 January 2025
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--Canara Bank MD: CD ratio of 78% comfortable, currently at 76.65%
--CONTEXT: Comments by Canara Bank mgmt in post-earnings analyst call
--Canara Bank MD: Not aggressive on lending to microfinance institutions
--Canara Bank MD: Deploying excess SLR bonds in money market lending
MUMBAI – Canara Bank is comfortable with the credit-to-deposit ratio of up to 78%, Managing Director and Chief Executive Officer K. Satyanarayana Raju said at a post-earnings analyst call. "We are comfortable at 78% because the 18% is SLR (statutory liquidity ratio), 4% is CRR (cash reserve ratio), together it's 22%, if you remove these two things, the 78% is comfortable for us, that is our comfort level," Raju said.
As of Dec. 31, the credit-to-deposit ratio of the bank was at 76.65%.
The bank is also reducing its microfinance lending portfolio and is not aggressive in giving loans in that segment, Raju said. "Our MFI (microfinance) exposure, we reduced it from one year ago. It was around above 700 crores (INR 7 billion), now it has come down to 300 crores (3 billion). We are not so aggressive on lending to the MFI," he said.
Talking about the reduction in excess government bonds held by the bank, Raju said the bank has intentionally brought down excess bonds to lend in the money market, where they are getting rates more than 6.50%. "We are partly deploying excess SLR for onward lending to the overnight market because the market is paying 20 to 30 basis points extra than what we are getting for excess SLR," Raju said. End
Reported by Kabir Sharma and Cassandra Carvalho
Edited by Akul Nishant Akhoury
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