Canara Bank Reports a 20-25% Rise

Canara Bank Reports a 20-25% RiseA top official in the State-run Canara Bank is expecting the net profit for the bank to raise 20-25 per cent from a year ago.

The treasure income registered was 4.33 billion rupees in September quarter, but it will be lesser in the December quarter, leading to a flat net profit growth, A.C. Mahajan, chairman and managing director, said on the sidelines of a conference organized by Indian Banks' Association and State Bank of India.

The bank has already recovered 9 billion rupees of bad assets since April and speculates to make an 11-12 billion rupees recovery in 2009/10.

In addition, he claimed that the lender's profit for the December quarter would increase mostly on the back of 15-20 percent net interest income growth coming mainly from infrastructure sector.

The profitability achieved by the company is based on the volumes so that the overall interest margin remains intact or rises slightly. The company also registers a rise in the bank's home loan portfolio soon after it directly lent to home buyers instead of refinancing it through institutions like HDFC and Housing and Urban Development Corp.

The bank has been successful in increasing its provision coverage ratio to 75 percent from its lowest level of 37 percent, prior to the new norm of the central bank.