Canara Bank · NSE:CANBK
Canara Bank — Q1 FY10 Earnings Presentation
38 slides from Canara Bank's earnings presentation, June 2009
Slide 1: June 2009
June 2009 www.canarabank.com Page 1
Slide 2: Canara at a Glance
Canara .. at a Glance A Premier Nationalised Bank in India Well spread network of 2739 branches Over 2000 ATMs spread across the country Nearly 35 million strong cross-section clientele base Consistent track record of profit making .. Since inception Financial Supermarket - 9 subsidiaries/s
Slide 3: Financial Highlights
FINANCIAL HIGHLIGHTS www.canarabank.com Page 3
Slide 4: Robust Profit Growth
ROBUST PROFIT GROWTH Net Profit (Rs. in Crore) 600 555 Increase of 353% 500 400 300 200 123 100 0 Q1 FY09 Q1 FY10 www.canarabank.com Page 4
Slide 5: Business Profile
BUSINESS PROFILE Amt. in Rs. Crore Jun’09 Jun’08 Y-o-Y Gr Aggregate Business 334325 266122 26% Total Deposits 193657 156295 24% Net Advances 140668 109827 28% CD Ratio (%) 72.64 70.27 237bps Robust Business Growth Of Over Rs.68000 Cr Domestic Business Constituted 97.7% www.canarabank.com Page 5
Slide 6: Topline Growth
TOPLINE GROWTH 193,657 186,893 180,000 154,072 156,295 160,000 142,381 138,219 140,668 140,000 120,000 107,238 109,827 Rs. Crore 98,506 100,000 80,000 60,000 40,000 20,000 0 2007 2008 2009 Jun'08 Jun'09 Deposits Advances Total Business Added during the First Quarter: Over Rs.9200 Crore www.canaraban
Slide 7: Total Assets
TOTAL ASSETS 219,646 222,980 200,000 180,529 184,049 180,000 165,961 160,000 140,000 Rs. Crore 120,000 100,000 80,000 60,000 40,000 20,000 0 2007 2008 2009 Jun-08 Jun-09 Significant Jump in Total Assets www.canarabank.com Page 7
Slide 8: Q1-FY10: Earnings Profile
Q1-FY10 : EARNINGS PROFILE Amt. in Rs. Crore Jun’09 Jun’08 Growth Interest on Advances 3425 2700 26.8% Total Int. Income 4558 3731 22.2% Total Int. Expenditure 3267 2711 20.5% Net Interest Income 1291 1019 26.7% www.canarabank.com Page 8
Slide 9: Income Growth: Q1 FY10
INCOME GROWTH: Q1 FY 10 Amt. in Rs. Crore Jun’09 Jun’08 Growth Total Income 5032 4099 22.8% Interest Income 4558 3731 22.2% Interest from Loans and Adv 3425 2700 26.8% Non-Interest Income 474 369 28.5% Robust Growth of Over 28% in Non-Interest Income www.canarabank.com Page 9
Slide 10: 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 Q1 FY10 (Jun’09) Q1 FY 09 (Jun’08) Others Others 11.0% 10.1% Investment Investment Income Income 21.8% 23.1% Int on Adv I
Slide 11: Expenditure Growth: Q1 FY10
EXPENDITURE GROWTH: Q1 FY 10 Amt. in Rs. Crore Jun’09 Jun’08 Growth Total Expenditure 3991 3395 17.5% Interest Expenditure 3267 2711 20.5% Operating Expenses 724 684 5.8% Cost-Income Ratio (%) 41.00 49.30 830bps www.canarabank.com Page 11
Slide 12: Net Interest Income: Q1 FY10
NET INTEREST INCOME : Q1 FY 10 Amt. in Rs. Crore Jun’09 Jun’08 Interest Income 4558 3731 Interest Expenditure 3267 2711 Net Interest Income 1291 1019 Y-o-Y Growth 26.7% 14.0% Net Interest Margin (%) 2.70 2.57 Improvement In NIM Over Jun’08 www.canarabank.com Page 12
Slide 13: Profit Growth: Q1 FY10
PROFIT GROWTH : Q1 FY10 Amt. in Rs. Crore Jun’09 Jun’08 Operating Profit 1041 704 Growth 48% 15% Provisions 486 581 Incl. Prov. for Wage Settlement 75 -- Net Profit 555 123 Growth 353% - 49% RoAA (%) 1.02 0.27 EPS (Rs.) (Not Annualized) 13.54 2.99 www.canarabank.com Page 13
Slide 14: Break-up of Other Income
BREAK-UP OF OTHER INCOME Amt. in Rs. Crore Jun’09 Jun’08 Total Other Income 473.57 368.51 Commission & Exchange 172.09 148.71 Profit from Exchange Trans 51.23 80.31 Trading Profit 28.16 -21.91 Dividend Income 13.81 9.44 Recovery in w/off A/cs 79.08 60.00 Other Misc. Income 129.20 91.96 www.canaraban
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
Slide 16: Break-up of Provisions
BREAK-UP OF PROVISIONS Amt. in Rs. Crore Jun’09 Jun’08 Total Provisions & Contingencies 486.00 580.91 Of Which: Non Performing Advances 216.00 140.00 Provision for Investments -- 400.91 Taxation 150.00 40.00 Additional Prov. Of Rs.75 Cr Under Wage Settlement www.canarabank.com Page 16
Slide 17: Profitability Ratios
PROFITABILITY RATIOS (In %) Jun’08 Sep’08 Dec’08 Mar’09 Jun’09 (Q1 FY09) (H1 FY09) (9M FY09) (FY09) (Q1 FY10) Cost of Deposits 6.36 6.60 6.81 6.87 6.48 Yield on Advances 10.06 10.50 10.69 10.79 10.05 Cost of Funds 5.90 6.07 6.23 6.32 6.00 Yield on Funds 8.12 8.39 8.57 8.73 8.37 Spread 2.22 2.32 2.34
Slide 18: Productivity Ratios
PRODUCTIVITY RATIOS Jun’09 Jun’08 Business per Employee (Rs. Crore) 8.10 6.25 Business per Branch (Rs. Crore) 122.06 98.71 Gross Profit per Employee (Rs. Lakh) 10.09 6.61 Net Profit per Employee (Rs. Lakh) 5.38 1.15 Highest Per Branch Business among Peers www.canarabank.com Page 18
Slide 19: Investment Portfolio
INVESTMENT PORTFOLIO Amt. in Rs. Crore Jun’09 Jun’08 Net Investments (Domestic) 59255 49648 38121 31518 Held to Maturity (64.3%) (63.5%) 20783 17966 Available for Sale (35.1%) (36.2%) 351 164 Held for Trading (0.6%) (0.3%) Figures in the brackets are percentage shares in total www.canarabank.com Pag
Slide 20: Asset Quality
ASSET QUALITY Jun’09 Jun’ 08 Gross NPA (Rs. Crore) 2463 1314 Gross NPA Ratio (%) 1.74 1.19 Net NPA (Rs. Crore) 1812 938 Net NPA Ratio (%) 1.29 0.85 92765 A/Cs Restructured- Aggregating to Rs.5190 Cr as at June’09 Substandard Assets Formed 75% of Gross NPA and 88% of net Intensive Thrust on Credit Mo
Slide 21: Comfortable Capital Position
COMFORTABLE CAPITAL POSITION CRAR of 13.59% at Jun’09 …well above the regulatory minimum of 9% Medium Term Objective .. CRAR of above 12% One of the best Capital Position amongst its Peers …still undiluted 73.17% GoI Holding in the Bank Adequate Headroom for Capital Augmentation www.canarabank
Slide 22: Capital Adequacy – Basel II
CAPITAL ADEQUACY – Basel II 15% Tier I capit al Tier 2 capit al 13% 6.09% 9.0% 11% 6.33% 6.24% 5.53% Minimum (6925) (7623) (7252) Total CRAR 9% (7250) 7% 6.0% 8.01% Minimum 5% 8.06% 7.17% 7.01% Tier I (10023) (10577) CRAR 3% (7850) (8148) 1% -1% M ar.0 7 M ar.0 8 M ar.0 9 Jun.0 9 Total 11.22% 13.50%
Slide 23: Earnings Profile
EARNINGS PROFILE 244.87 258.25 202.33 205.6 60 197.83 50.55 200 50 38.17 40 34.65 150 30 100 20 13.54 50 10 2.99 0 0 EPS (Rs) BV (Rs) Mar-07 Mar-08 Mar-09 . Jun-08 Jun-09 Mar-07 Mar-08 Mar-09 . Jun-08 Jun-09 Continues to Sustain High Levels of Earnings Book Value (BV) and Earnings Per Share (EPS) sh
Slide 24: Share Holding Pattern
SHARE HOLDING PATTERN As on June 30, 2009 6.5% 1.2% 3.1% 5.5% 10.5% 73.2% Govt of India FIIs Resident Individuals MFs IFIs Others www.canarabank.com Page 24
Slide 25: Business Focus
BUSINESS FOCUS www.canarabank.com Page 25
Slide 26: Core Deposits Growth
CORE DEPOSITS GROWTH Amt. in Rs. Crore Jun’09 Jun’08 Y-o-Y Gr Core Deposits 160955 112695 42.8% Retail Term Deposits 107101 60898 75.9% CASA per Branch 19.66 19.21 Deposits Clientele (Mn) 31.07 28.72 2.35 Mn Highest Per Branch CASA Deposit among Peers www.canarabank.com Page 26
Slide 27: Credit Focus
CREDIT FOCUS Amt. in Rs. Crore Jun’09 Jun’08 Y-o-Y Gr Priority Sector Credit 50217 42126 19.2% Agriculture Credit 20675 17357 19.1% MSME Advances 23652 19173 23.4% Retail Lending 19819 17486 13.3% Housing 7975 6423 24.2% Infrastructure Advances 21027 13714 53.3% Adv Clientele (Mn) 4.33 4.02 0.3Mn We
Slide 28: Priority Sector
PRIORITY SECTOR Amt. in Rs. Crore Jun’09 Jun’08 Y-o-Y Gr Priority Credit O/s 50217 42126 19.2% Agriculture Adv O/s 20675 17357 19.1% MSME Advances O/s 23652 19173 23.4% Disbursed Rs. 4059 crore to Agriculture in Q1 www.canarabank.com Page 28
Slide 29: Pioneering Education Loan
PIONEERING EDUCATION LOAN Education Loans up by 32.8% y.o.y Outstanding Education Loans as at Jun ‘09 Rs.2387 crore The portfolio covers over 1.47 lakhs students On-line Education Loan application in web portal Number ONE amongst Nationalised Banks In Outstanding Education Loans www.canaraba
Slide 30: Expanding the Reach
EXPANDING THE REACH Jun’09 Jun’08 Y-o-Y Incr Branch Network 2739 2696 43 ATM Strength 2019 2013 Card Base (In Lakh) 48.10 35.76 12.34 ATM Tally of over 2000 (778 Off-Site ATMs, including 187 ATMs at important Railway Stations) Ongoing Initiatives Increase Debit-Cum-ATM Card Base Enhance Per AT
Slide 31: Expanded Clientele Base
EXPANDED CLIENTELE BASE Jun’09 Jun’08 Y-o-Y Incr Clientele Base in Mn 35.40 32.74 2.66 - No of Deposit a/cs (Mn) 31.07 28.72 2.35 - No of Borrowal a/cs (Mn) 4.33 4.02 0.31 Over 35 million strong and growing clientele base www.canarabank.com Page 31
Slide 32: Infotech Progress
INFOTECH PROGRESS Jun’09 Jun’08 Core Banking Branches 1058 1028 Anywhere Banking Branches 2078 1934 Internet & Mobile Banking Branches 1362 1335 NEFT and RTGS All Branches 77% Business under Core Banking Solution Large ATM Network across the Country www.canarabank.com Page 32
Slide 33: Plans for FY10
PLANS FOR FY10 Aiming at a 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 Over 200 new branches to be opened during the year Continued focus on Core Business Growth Further CBS rollout during the year- branches and service
Slide 34: Canara Bank Initiatives
dorel dap Canara Bank Initiatives... www.canarabank.com Page 34
Slide 35: Initiatives: 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 fixed at 8.25% for 12 months and 9.25% for next 48 months Focus on Retail Asset Hubs-Central Processing Units …. for reducing turnaround time www.canara
Slide 36: Spread Management
SPREAD MANAGEMENT Spread Management Challenges on Sustaining Net Interest Margin … southward movement in interest rates Reduction in BPLR - from 12.50% to 12.00% (w.e.f 1st April 2009 ) Reduction in deposit rate from the peak of 10.5% to 7.5% at present Measures Intensive mobilization of Cor
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
Slide 38: Canara Bank
dorel dap Canara Bank www.canarabank.com Page 38