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Informist, Monday, May 11, 2026

 

--Canara Bank: Focused on expanding our retail, agriculture, MSME credit 

--CONTEXT: Comments by Canara Bank's mgmt in post-earnings analyst call 

--Canara Bank: Endeavour is to change loan mix 

--Canara Bank: See retail, agri, MSME loans around 60%, corporate 40% 

--Canara Bank: Priority sector lending income expected to remain steady FY27 
--Canara Bank: Confident of protecting operating profit number for FY26 

 

By Vaishali Tyagi and Shweta 

 

NEW DELHI – Canara Bank is focused on expanding its retail, agriculture, and micro, small, and medium enterprises loan portfolio, the bank's management told analysts in a conference call after announcing the March quarter earnings. On the business front, its global advances rose over 15% on year to INR 12.38 trillion. Of the total global advances, the bank's retail, agriculture, and micro, small, and medium enterprises rose nearly 20% on year to INR 7.31 trillion. 

 

For Apr-Mar (2025-26), 59% of the loan book comprised retail, agriculture, and micro, small, and medium enterprises, up from 57% a year ago. The bank's corporate loans were at 41% in FY26, down from 43% a year ago. "In terms of RAM (retail, agriculture, and micro, small, and medium enterprises) and corporate mix, we have now reached 59% of RAM and around 40% of corporate," the management said. "And, we will able to reach at 60-40 (60% of retail, agriculture, and micro, small, and medium enterprises loans and 40% corporate loans). And within the RAM, we continue to grow the retail segment." 

 

The bank released its earning during market hours. The lender's net profit for the March quarter was INR 45.06 billion, down nearly 10% on year. Sequentially, it slipped nearly 13%. Analysts had estimated the bank's bottom line at INR 44.02 billion. On Monday, the bank's shares ended down nearly 4% at INR 129.43 on the National Stock Exchange.

 

On the lending front, the bank's management expects its income from priority sector lending to remain steady in FY27. It said it had exceeded the mandated lending norms to priority sector lending. 

 

Canara Bank's priority sector lending stood at 43.71% of adjusted net bank credit in the March quarter, above the regulatory norm of 40%, the bank said. Lending to agriculture was at 19.52% of adjusted net bank credit, against the required 18% mandatory requirement. Credit to small and marginal farmers was 12.55%, against the 10% norm, while non-corporate farmers accounted for 15.10% against the mandated 14%. The bank's lending to weaker sections stood at 18.65% of adjusted net bank credit, well above the 12% required. "Our PSLC (priority sector lending certificates) income is around INR 2500 crores (INR 25 billion)...and this year also we are confident that we will derive the same PSLC income," the management said. "Because we are above, in all priority sector credit, we are exceeding all mandated norms, and it should be similar to FY26 in next." 

 

The bank's top management showed confidence in protecting operating profitability seen in FY26 in FY27 as well. The bank's operating profit for FY26 was INR 330.19 billion, up over 5%. For Jan-Mar, it was at INR 67.58 billion, down from INR 91.19 billion from Oct-Dec. "So, very soon, some reversal will be seen... already, it is showing in our books. So, we are very confident that it will be protected and the ROA (return on assets) will be in the trajectory of 1%," the management said.

 

For FY27, the lender expects its global advances to rise 11–12%, and global deposits to rise 9-10%. "...we are confident of exceeding guidance of 11-12% on the advances front," the management said.  End

 

Edited by Avishek Dutta

 

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