Public sector lender Canara Bank's second quarter earnings met analysts' expectations on Wednesday. Performance on yearly basis continued to be weak but the bank improved it on sequential basis.
Profit fell 32.5 percent year-on-year to Rs 356.91 crore on higher provisions but increased 56 percent quarter-on-quarter. Net interest income during the quarter declined 7.7 percent to Rs 2,442.35 crore compared with year-ago period but was up 5.8 percent compared with previous quarter.
Worst is almost over and the bank should control NPA at 9 percent by March 2017, Rakesh Sharma, MD and CEO said in an interview with CNBC-TV18. Non-interest income jumped 47.2 percent to Rs 1,781.77 crore and operating profit grew by 10.1 percent to Rs 2,140.77 crore on yearly basis.
According to analysts polled by CNBC-TV18, profit was expected at Rs 320 crore and net interest income at Rs 2,452.7 crore for the quarter. Asset quality was steady during the quarter with net non-performing assets remained unchanged at 6.69 percent on sequential basis, though gross NPA increased marginally to 9.82 percent from 9.71 percent QoQ.
In absolute terms, gross NPAs stood at Rs 33,315 crore in July-September quarter, higher by 3 percent over previous quarter and net NPA grew by 1.8 percent to Rs 21,887 crore QoQ.
Provisions for bad loans jumped 30.8 percent year-on-year and 6.2 percent quarter-on-quarter to Rs 1,586 crore in the quarter ended September 2016.
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