Canara Bank , one of India's leading public sector banks, has reported a robust financial performance for the second quarter of fiscal year 2025-26, with significant improvements in profitability and asset quality.

Key Financial Highlights

• Net Profit: The bank's net profit rose by 18.93% year-on-year to ₹4,774.00 crore for Q2 FY2025-26, compared to ₹4,014.00 crore in the same quarter last year.
• Operating Profit: Operating profit increased by 12.20% to ₹8,588.00 crore, up from ₹7,654.00 crore in Q2 FY2024-25.
• Total Income: The bank's total income grew by 11.17% to ₹38,598.00 crore, compared to ₹34,721.00 crore in the corresponding quarter of the previous year.

Asset Quality Improvement

Canara Bank has shown significant improvement in its asset quality metrics:

• Gross Non-Performing Assets (GNPA) ratio decreased to 2.35% as of September 30, 2025, down from 3.73% a year ago.
• Net Non-Performing Assets (NNPA) ratio improved to 0.54%, compared to 0.99% in the same period last year.
• Provision Coverage Ratio (PCR) strengthened to 93.59%, an increase of 270 basis points year-on-year.

Business Growth

The bank has demonstrated strong growth in its business segments:

• Global Business grew by 13.55% year-on-year to ₹26,78,963.00 crore.
• Global Deposits increased by 13.40% to ₹15,27,922.00 crore.
• Global Advances rose by 13.74% to ₹11,51,041.00 crore.

Retail and MSME Focus

Canara Bank has shown a strong focus on retail and MSME sectors:

• Retail Credit grew by 29.11% year-on-year to ₹2,51,190.00 crore.
• Housing Loans increased by 15.25% to ₹1,14,615.00 crore.
• MSME Credit stood at ₹1,53,777.00 crore, growing by 12.70% year-on-year.

Capital Adequacy and Profitability

• The bank's Capital Adequacy Ratio under Basel III stood at 16.20% as of September 30, 2025, with CET1 ratio at 12.21%.
• Return on Assets (RoA) improved to 1.12%, up by 7 basis points year-on-year.
• Earnings per Share (EPS) increased by 20.68% to ₹21.01.

Digital and Network Expansion

Canara Bank continues to expand its digital footprint and physical presence:

• The bank has 9,948 branches, including 3,165 in rural areas and 1,872 in metro locations.
• It operates 7,405 ATMs and 4 overseas branches.

K. Satyanarayana Raju, Managing Director & Chief Executive Officer of Canara Bank, stated, "Our Q2 results reflect the bank's strong fundamentals and strategic focus on quality growth. The significant improvement in asset quality and profitability metrics demonstrates our commitment to creating sustainable value for all stakeholders."

The bank's performance indicates a positive trajectory in its core operations, asset quality management, and overall business growth, positioning it well for future challenges and opportunities in the banking sector.

Canara Bank , one of India's leading public sector banks, has announced plans for bond fundraising while addressing the topic of potential mergers among public sector banks during a recent conference call. The bank reported that it has not received any updates from the government regarding possible consolidation in the public sector banking space.

Bond Fundraising Plans

Canara Bank plans to raise part of its approved funds through bonds in Q3, with a target to collect a total of INR 95 billion through bonds by FY26. This strategic move aims to strengthen the bank's capital position and support its growth objectives.

No New Information on Mergers

During the conference call, Canara Bank officials stated that the government has not communicated any new information about potential mergers involving public sector banks. This lack of updates suggests that there are no immediate plans for further consolidation in the sector, at least as far as Canara Bank is aware.

Recent Financial Performance

While the bank did not provide new information on mergers, it's worth noting Canara Bank's recent financial performance based on the latest available data:

Increased Credit Demand

The bank also reported higher credit demand in October during the festival season, indicating a positive trend in lending activities.

Stable Operations Amid Merger Speculation

The bank's statement on the absence of merger updates, combined with its financial performance and fundraising plans, suggests that Canara Bank continues to focus on its core operations and growth strategies. The lack of new information on potential mergers allows the bank to maintain its current course without the uncertainty that often accompanies consolidation discussions.

Industry Context

The Indian banking sector has seen several mergers in recent years as part of the government's efforts to create stronger and more efficient banks. However, the absence of new updates indicates that the government may be allowing time for previously merged entities to stabilize and realize the benefits of consolidation before considering further mergers.

As the banking landscape continues to evolve, Canara Bank's position as a key player in the public sector banking space remains significant. The bank's performance, fundraising initiatives, and any future updates on sector consolidation will be closely watched by investors and industry observers.