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View Promises →Canara Bank Ltd — Q4 FY26
Canara Bank reported a mixed Q4 FY26.
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Canara Bank reported a mixed Q4 FY26. Full-year net profit grew 12.69% to ₹19,187 crore, driven by strong credit growth of 15.30% and NIM improvement of 9 bps QoQ to 2.5-2.6%. However, quarterly operating profit fell sharply due to the absence of ₹1,930 crore listing gains from Canara HSBC and Canara Rebecca, and MTM losses of ₹800 crore from bond yield volatility. Asset quality improved with GNPA down 110 bps YoY to 1.84% and SMA book declining. Management guided for 11-12% credit growth in FY27 (confident of exceeding), NIM of 2.5-2.6%, and ROA above 1%. ECL implementation impact of ~₹10,000 crore can be absorbed over four years. Key risk: elevated slippages in MSME and agri segments could pressure credit costs.
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MSME slippages remain elevated
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Read Transcript →Quarter Snapshot
Global Business
₹28.0 lakh cr
+12.11% YoY
Global business grew to ₹28.0 lakh crore, driven by strong advances growth.
GNPA Ratio
1.84%
-110 bps YoY
Gross NPA ratio improved 110 bps year-on-year to 1.84%.
SMA Book
₹33,728 cr
-16.7% YoY
SMA outstanding declined from ₹40,481 cr in Mar'25 to ₹33,728 cr in Mar'26.
Gold Loan Portfolio
₹2.45 lakh cr
+33% YoY
Gold loan portfolio grew strongly, with retail gold loans driving the growth.
What Changed vs Last Quarter
NEW
Credit growth guidance of 11-12% for FY27
Management guided for 11-12% advances growth, but expressed confidence in exceeding this, similar to last year's 10-11% guidance which ended at 15.30%.
NEW
ROA above 1% for FY27
Return on assets is guided to be above 1% for the full year, despite the absence of one-time listing gains.
UPDATED
NIM to remain in 2.5-2.6% range
Net interest margin is expected to sustain at 2.5-2.6% in FY27, supported by conscious pricing on deposits and focus on high-yield RAM credit.
UPDATED
ECL impact of ~₹10,000 cr can be absorbed over 4 years
The bank estimates a total ECL provision requirement of about ₹10,000 crore, which can be staggered over four years, with profits of ₹19,000-20,000 crore providing ample buffer.
DROPPED
Credit growth to sustain above 13%
Despite initial guidance of 10-11%, management expects credit growth to remain above 13% in Q4, driven by RAM sector momentum.
DROPPED
Recovery from written-off accounts to continue at ₹2,000+ crore per quarter
Management expects recovery from written-off accounts to remain above ₹2,000 crore per quarter, similar to current run rate.
NEW RISK
MSME slippages remain elevated
Out of total slippages of ₹2,771 crore in Q4, ₹1,333 crore came from MSME, indicating stress in this segment.
NEW RISK
Geopolitical risks and bond yield volatility
Management cited geopolitical tensions causing bond yield movements and MTM losses of ₹800 crore in Q4, which could recur.
NEW RISK
Gold loan fraud incidents
Recent media reports of gold loan frauds pose operational risk, though management has implemented checks and NPA remains minimal.
RISK GONE
NIM compression from further rate cuts
If RBI cuts repo rate further, NIM could compress as 49% of advances are repo-linked while deposit repricing lags by 6-12 months.
RISK GONE
CASA ratio remains below peers
CASA ratio at ~30% is lower than peers, limiting margin expansion despite strong retail growth.
RISK GONE
Gold loan regulatory compliance
RBI observations on gold loan classification in metro/urban centers required product rollback; any further regulatory tightening could impact growth.
Fast read
Guidance and risk preview
Management guided for 11-12% advances growth, but expressed confidence in exceeding this, similar to last year's 10-11% guidance which ended at 15....
Out of total slippages of ₹2,771 crore in Q4, ₹1,333 crore came from MSME, indicating stress in this segment.
View Risks →