Canara Bank · NSE:CANBK

Canara Bank — H1 FY10 Earnings Presentation

38 slides from Canara Bank's earnings presentation, September 2009

  1. Slide 1: September 2009

    September 2009 www.canarabank.com Page 1

  2. Slide 2: Canara at a Glance

    Canara .. at a Glance A Premier Nationalised Bank in India  Well spread network of 2806 branches Over 2000 ATMs spread across the country  Nearly 36 million strong cross-section clientele base  Consistent track record of profit making .. Since inception  Financial Supermarket - 9 subsidiaries/s

  3. Slide 3: Financial Highlights

    FINANCIAL HIGHLIGHTS www.canarabank.com Page 3

  4. Slide 4: Robust Profit Growth - Q2 FY10

    ROBUST PROFIT GROWTH - Q2 FY10 www.canarabank.com Page 4

  5. Slide 5: Profit Growth – H1 FY10

    PROFIT GROWTH – H1 FY10 www.canarabank.com Page 5

  6. Slide 6: Business Profile

    BUSINESS PROFILE Amt. in Rs. Crore Sep’09 Sep’08 Y-o-Y Gr Global Business 350740 290824 20.6% Total Deposits 204284 171510 19.1% Net Advances 146456 119314 22.8% CD Ratio (%) 71.69 69.57 212bps Robust Business Growth Of Rs.60,000 Cr Domestic Business Constituted 97.8% www.canarabank.com Page 6

  7. Slide 7: Topline Growth

    TOPLINE GROWTH 204,284 200,000 186,893 154,072 142,381 138,219 146,456 150,000 Rs. Crore 107,238 98,506 100,000 50,000 0 2007 2008 2009 Sep'09 Deposits Advances Total Business Added during the H1 : Over Rs.25600 crore www.canarabank.com Page 7

  8. Slide 8: Total Assets

    TOTAL ASSETS 234,754 240,000 219,646 220,000 200,000 180,529 180,000 165,961 Rs. Crore 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 2007 2008 2009 Sep-09 Significant Jump in Total Assets www.canarabank.com Page 8

  9. Slide 9: Income

    INCOME Amt. in Rs. Crore H1FY10 H1FY09 Growth Q2 FY10 Q2 FY09 Growth Total Income 10634 8547 24.4% 5602 4448 26.0% Int. Income 9268 7840 18.2% 4709 4109 14.6% Int. Loans/Adv 6930 5754 20.4% 3505 3054 14.8% 163.6 Non-Int. Inc 1367 707 93.2% 893 339 % Impressive Earnings www.canarabank.com Page 9

  10. Slide 10: Expenditure

    EXPENDITURE Amt. in Rs. Crore Q2 H1FY10 H1FY09 Growth FY10 Q2 FY09 Growth Total Exp. 8174 7070 15.6% 4183 3674 13.8% Int. Exp. 6662 5672 17.5% 3395 2960 14.7% Op. Expense 1511 1398 8.1% 787 714 10.3% Staff Expense 920 843 9.2% 462 422 9.6% Cost-Income Ratio (%) 38.05 48.63 -10.6% 35.69 48.01 -12.3%

  11. Slide 11: Profit Growth

    PROFIT GROWTH Amt. in Rs. Crore H1FY10 H1FY09 Q2 FY10 Q2 FY09 Operating Profit 2460 1477 1419 774 Growth 66.6% 17.0% 83.5% 19.0% Provisions 995 825 509 244 incl Prov for Taxation 350 140 200 100 Net Profit 1466 652 911 529 Growth 124.8 1.6% 72.0% 31.8% RoAA (%) 1.32 0.70 1.63 1.13 EPS (Rs.) (Not Ann

  12. Slide 12: Earnings Profile

    EARNINGS PROFILE Amt. in Rs. Crore H1FY10 H1FY09 Q2 FY10 Q2 FY09 Net Int. Income 2605 2168 1314 1149 Y-o-Y Growth 20.2% 29.0% 14.3% 46.0% Net Int. Margin (NIM) (%) 2.66 2.70 2.66 2.70 NIM Protected at 2.66% www.canarabank.com Page 12

  13. Slide 13: Major Components of Income

    MAJOR COMPONENTS OF INCOME  Interest Income continues to drive growth in income …over 2/3rd of earnings from interest on advances/loans  Robust growth under Non-Interest Income H1 FY10 (Sep’09) H1 FY 09 (Sep’08) Others Others 9.4% 13.9% Investment Investment Income Income 23.3% 20.9% Int on Adv In

  14. Slide 14: Break-up of Other Income

    BREAK-UP OF OTHER INCOME Rs. in Crore FY 10 FY 09 H1 Q2 H1 Q2 Total Other Income 1366.51 892.94 707.28 338.77 Commission & Exchange 327.63 155.54 303.89 155.17 Profit from Exchange Trans 110.42 59.19 74.62 -5.69 Trading Profit 463.96 435.80 -18.37 3.53 Dividend Income 44.41 30.60 24.39 14.95 Recover

  15. Slide 15: Measures to Augment Non Interest Income

    MEASURES TO AUGMENT NON INTEREST INCOME Increased thrust on Fee Income Broadbasing of Fee Income sources  Cross Selling of Insurance Mutual Fund Products On-line Trading Services Other Traditional Services- LCs, Guarantees, DDs and others. www.canarabank.com Page 15

  16. Slide 16: Break-up of Provisions

    BREAK-UP OF PROVISIONS In Rs Crore FY 10 FY 09 H1 Q2 H1 Q2 Total Provision & Contingencies 994.60 508.60 825.00 244.09 Of Which: Non Performing Advances 459.00 243.00 293.00 153.00 Provision for Investments -32.40 -32.40 395.00 -5.91 Taxation 350.00 200.00 140.00 100.00 www.canarabank.com Page 16

  17. Slide 17: Profitability Ratios (%)

    PROFITABILITY RATIOS (%) Sep’08 Dec’08 Mar’09 Jun’09 Sep’09 (H1 FY09) (9M FY09) (FY09) (Q1 FY10) (H1 FY10) Cost of Deposits 6.60 6.81 6.87 6.48 6.47 Yield on Advances 10.50 10.69 10.79 10.05 10.02 Cost of Funds 6.07 6.23 6.32 6.00 5.98 Yield on Funds 8.39 8.57 8.72 8.37 8.32 Spread 2.32 2.34 2.40 2.

  18. Slide 18: Productivity Ratios

    PRODUCTIVITY RATIOS Sep’09 Sep’08 Business per Employee (Rs. Crore) 8.46 6.86 Business per Branch (Rs. Crore) 125.00 107.16 Gross Profit per Employee (Rs. Lakh) 11.87 6.97 Net Profit per Employee (Rs. Lakh) 7.07 3.08 Highest Per Branch Business among Peers www.canarabank.com Page 18

  19. Slide 19: Investment Portfolio

    INVESTMENT PORTFOLIO Amt. in Rs. Crore Sep’09 Sep’08 Net Investments (Domestic) 64403 50192 50671 37119 Held to Maturity (78.7%) (74.0%) 13416 12935 Available for Sale (20.8%) (25.7%) 316 138 Held for Trading (0.5%) (0.3%) Figures in the brackets are percentage shares in total www.canarabank.com Pag

  20. Slide 20: Asset Quality

    ASSET QUALITY Sep’09 Sep’ 08 Gross NPA (Rs. Crore) 2348 1437 Gross NPA Ratio (%) 1.60 1.20 Net NPA (Rs. Crore) 1694 1065 Net NPA Ratio (%) 1.16 0.89 Substandard Assets: 65.5% of Gross NPA and 77.3% of Net NPA Intensive Thrust on Credit Monitoring and Containing Slippages www.canarabank.com Page 20

  21. Slide 21: Comfortable Capital Position

    COMFORTABLE CAPITAL POSITION  CRAR of 14.46% at Sep’09 …well above the regulatory minimum of 9% …Tier I ratio at 8.95% …Tier II ratio at 5.51%  Medium Term Objective .. CRAR of above 12% …still undiluted 73.17% GoI Holding in the Bank Adequate Headroom for Capital Augmentation www.canarabank.com P

  22. Slide 22: Capital Adequacy – Basel II

    CAPITAL ADEQUACY – Basel II 15% Tier I capit al Tier 2 capit al 13% 6.09% 5.51% 6.33% 6.24% 9.0% 11% (7623) (6925) (7250) (7251) Minimum Total 9% CRAR 8.95% 8.01% 7% 7.17% 7.01% (11794) 6.0% 5% (7850) (8148) (10023) Minimum Tier I CRAR 3% 1% -1% M ar.07 M ar.08 M ar.09 Sep.09 Total 13.50% 13.25%* 14

  23. Slide 23: Earnings Profile

    EARNINGS PROFILE 60 350 50.55 280.38 300 50 244.87 38.17 202.33 219.25 40 34.65 35.75 250 197.83 200 30 150 15.91 20 100 10 50 0 0 EPS (Rs) BV (Rs) Mar-07 Mar-08 Mar-09 . Sep-08 Sep-09 Mar-07 Mar-08 Mar-09 . Sep-08 Sep-09 Continues to Sustain High Levels of Earnings Book Value (BV) and Earnings Per

  24. Slide 24: Share Holding Pattern

    SHARE HOLDING PATTERN As on September 30, 2009 7.1% 1.2% 3.0% 5.1% 10.4% 73.3% Govt of India FIIs Resident Individuals MFs IFIs Others www.canarabank.com Page 24

  25. Slide 25: Business Focus

    BUSINESS FOCUS www.canarabank.com Page 25

  26. Slide 26: Core Deposits Growth

    CORE DEPOSITS GROWTH Amt. in Rs. Crore Sep’09 Sep’08 Y-o-Y Gr Core Deposits 176646 116181 52.0% Retail Term Deposits 118044 62868 87.8% CASA per branch 20.88 19.64 Deposits Clientele (Mn) 31.68 29.23 2.45Mn Highest Per Branch CASA Deposit among Peers www.canarabank.com Page 26

  27. Slide 27: Credit Focus

    CREDIT FOCUS Amt. in Rs. Crore Sep’09 Sep’08 Y-o-Y Gr Priority Sector Credit 53026 44946 18.0% Agriculture Credit 22583 18798 20.1% MSME Advances 27029 20323 33.0% Retail Lending 20608 17766 16.0% Housing 8230 6564 25.4% Infrastructure Advances 24173 15135 59.7% Adv Clientele (Mn) 4.15 3.89 0.26Mn W

  28. Slide 28: Pioneering Education Loan

    PIONEERING EDUCATION LOAN  Education Loans up by 30% y.o.y  Outstanding Education Loans as at Sep’09 Rs.2652 crore  The portfolio covers over 1.5 lakh students  On-line Education Loan application in web portal Number ONE amongst Nationalized Banks In Outstanding Education Loans www.canarabank.co

  29. Slide 29: Expanding the Reach

    EXPANDING THE REACH Sep’09 Sep’08 Y-o-Y Incr Branch Network 2806 2714 92 ATM Strength 2019 2013 Card Base (In Lakh) 65.00 49.08 15.92 Strategic Initiatives  Focus on Expanding Domestic Branch Network  Addition of 128 branches during the current financial so far  Thrust on Savings deposits: Ongoin

  30. Slide 30: Expanded Clientele Base

    EXPANDED CLIENTELE BASE Sep’09 Sep’08 Y-o-Y Incr Clientele Base in Mn 35.83 33.12 2.71 - No of Deposit a/cs (Mn) 31.68 29.23 2.45 - No of Borrowal a/cs (Mn) 4.15 3.89 0.26 Nearly 36million strong clientele base www.canarabank.com Page 30

  31. Slide 31: Infotech Progress

    INFOTECH PROGRESS Sep’09 Sep’08 Core Banking Branches 1591 1043 Anywhere Banking Branches 2084 2027 Internet & Mobile Banking Branches 1591 1351 NEFT and RTGS All Branches 87.5% Business under Core Banking Branches www.canarabank.com Page 31

  32. Slide 32: Awards and Accolades

    AWARDS AND ACCOLADES Hon'ble Prime Minister of India, Dr. Manmohan Singh conferred the ‘BEST BANK IN SOUTH ZONE’ AWARD for the year 2008-09 in respect of implementation of KVIC and PMEGP schemes. www.canarabank.com Page 32

  33. Slide 33: Plans for FY10

    PLANS FOR FY10  Total Business of Rs.4,00,000 crore by Mar’10 … Rs.2,25,000 crore under Deposits … Rs.1,75,000 crore under Advances  Focus on domestic branch expansion – To Cross 3000 branches  Focus on Core Business and Core Income Growth  Further CBS rollout of branches/units  Increasing tech

  34. Slide 34: Canara Bank Initiatives

    dorel dap Canara Bank Initiatives... www.canarabank.com Page 34

  35. Slide 35: Initiatives… To Expand Credit: Retail Lending Push

    INITIATIVES… To Expand Credit RETAIL LENDING PUSH  Intensive focus on housing loans  Attractive offerings for housing loans upto Rs.30 lakhs …RoI reduced to 8% for 12 months and 9% for next 48 months.  Focus on Retail Asset Hubs-Central Processing Units …. for reducing turnaround time www.canarab

  36. Slide 36: Spread Management

    SPREAD MANAGEMENT Spread Management  Challenges on Sustaining Net Interest Margin  Reduction in BPLR - from 12.5% to 12% (w.e.f April 1st 2009 )  Reduction in deposit rate from the peak of 10.5% to 7.25% at present Measures  Intensive mobilization of Core Deposits  Thrust on CASA deposits – Ong

  37. Slide 37: Cost Management

    COST MANAGEMENT Cost Management  Effective Cost Management to protect ‘Operating Margin’  Exercising Restraint/Control on ‘Other Operating Expenses’  Economizing cost and rental for branches/offices/ATMs  Optimizing the utilization of ATMs  Reducing burden, improving pool of non-interest income

  38. Slide 38: Canara Bank

    dorel dap Canara Bank www.canarabank.com Page 38

Canara Bank — H1 FY10 Earnings Presentation on 6ix