MTM blow halves Canara Bank net

BANGALORE: Canara Bank on Monday reported a 49% dip in net profit at Rs 122.68 crore in the first quarter this fiscal, compared to Rs 240.55 crore in the same period last year, taking a hit on its investment portfolio.

The net profit figure was after making a total provision of Rs 581 crore as the bank took the hit on its portfolio due to rising inflation and sharp increase in bond yield, senior bank officials told reporters here.

The Bangalore-headquartered bank’s net interest income increased 14% to Rs 1,019.2 crore, up from Rs 894.05 crore in the corresponding quarter last year.
Total income increased from Rs 3,760.07 crore to Rs 4,099.05 crore in the April-June quarter, up 9%.

“The bank’s global business rose to a level of Rs 2,66,242 crore as at June 2008, recording a year-on-year growth of 12%, compared to Rs 2,37,866 crore as at June 2007,” chairman and managing director A C Mahajan said.

Aggregate business was driven by a 9.2% growth in deposits and 16.1% growth in advances. The bank has obtained the final clearance from the Chinese Banking Authority for converting its representative office at Shanghai  into a full-fledged branch.

The bank has already received approval from Reserve Bank of India to open five branches in Johannesburg, Frankfurt, Muscat, Manama and Qatar, out of the 21 international centres identified for global expansion in the medium term. The bank aims to cover all branches under core banking solution by March next year, he said.