Canara Bank FY26 Annual Earnings Summary
4 quarters covered · ₹0 Cr revenue · ₹33,868 Cr PAT · 0.0% average EBITDA margin.
Quarter-by-quarter progression
Management promises made during the year
Promise tracking available after 2+ quarters of coverage.
Risks flagged during the year
Management noted that additional rate cuts (2 more expected by market) could delay NIM recovery and make the 2.75-2.80% guidance difficult.
Q1 FY26 · mediumTwo large accounts (real estate and irrigation) in SMA-2 for six quarters; management provided INR 1,200 crore extra provisions but risk remains if they slip.
Q1 FY26 · mediumCASA dropped to 29% due to institutional deposit outflows; management expects recovery but structural improvement remains a challenge.
Q2 FY26 · mediumIf RBI cuts rates further, NIMs could face additional pressure as 45% of loans are repo-linked while deposit repricing lags by 9-12 months.
Q2 FY26 · mediumNew expected credit loss norms from March 2027 may require higher provisions, especially for smaller accounts below ₹5 crore.
Q2 FY26 · mediumWith balance sheet growing at 14%, maintaining CASA at 32% is challenging; management acknowledged the difficulty.
Q3 FY26 · mediumCASA ratio at ~30% is lower than peers, pressuring NIM. Management acknowledged this as an industry challenge and a key drag on margins.
Q3 FY26 · mediumWith 49% of advances linked to repo rate, any further rate cuts could compress NIM further, though management expects stabilization at 2.45-2.50%.
Q3 FY26 · mediumQ3 profit included INR 2,006 crore from stake sales in subsidiaries. Such gains are non-recurring, and treasury income may normalize if yields do not soften.
Q4 FY26 · mediumRecent media reports of gold loan fraud; management has checks but one-off incidents may occur.
Q4 FY26 · mediumOut of total slippage of INR 2,771 crore, INR 1,333 crore came from MSME, indicating stress in that segment.
Q4 FY26 · mediumExact run-rate impact of ECL on credit cost not yet quantified; system implementation only by September.
What changed through the year
Q1 FY26 · Credit growth of 10-11% for FY26
Management expects overall credit growth of 10-11%, with RAM growing at 15% and corporate at 10%.
Q1 FY26 · NIM to stabilize around 2.5% in Q2, gradual improvement in H2
NIM likely to bottom at 2.5% in Q2 FY26, with gradual recovery in H2 as deposit costs reprice, assuming no further rate cuts.
Q1 FY26 · ROA guidance of 1.05% for FY26
Management reiterated ROA target of 1.05% for the full year, with Q1 already at 1.14%.
Q1 FY26 · Credit cost guidance of 90bps for FY26
Credit cost expected at 90bps for the year, though management expects to outperform due to improving asset quality.
Q2 FY26 · Net profit to cross INR 20,000 crore in FY26
Management expects net profit to exceed INR 20,000 crore for the full fiscal year, up from INR 17,400 crore last year.
Q2 FY26 · CASA ratio target of 32% by March 2026
Management reiterated its guidance to achieve a CASA ratio of 32% by end of FY26, despite balance sheet growing at 14%.
Q2 FY26 · RAM to corporate ratio of 60:40 by March 2027
The bank aims to reach a 60:40 split between RAM (retail, agriculture, MSME) and corporate loans by next fiscal year.
Q2 FY26 · Credit cost to remain below 1%
Management expects credit cost to stay well below 1% going forward, even with ECL implementation in March 2027.
Q3 FY26 · NIM to remain in 2.45%-2.50% range
Management expects net interest margin to stabilize at 2.45-2.50% even if further repo rate cuts occur, supported by RAM growth and deposit repricing.
Q3 FY26 · Credit growth to sustain at 13%+
Advances growth guidance of 10-11% has been surpassed; management expects to maintain current 13.59% growth momentum in Q4.
Q3 FY26 · ECL impact of INR 10,000 crore amortized over 4 years
Expected credit loss implementation from April 2027 will require additional provisions of ~INR 10,000 crore, to be spread over four years, with annual impact of INR 2,000-2,500 crore.
Q3 FY26 · Recovery from written-off accounts to continue at INR 2,000+ crore per quarter
Management expects to maintain recovery run-rate of over INR 2,000 crore per quarter from written-off accounts, supported by multiple recovery channels.
Q4 FY26 · Credit growth guidance of 11-12% for FY27
Management guided for 11-12% loan growth, but expects to exceed it as in prior years.
Q4 FY26 · NIM to remain in 2.5-2.6% range
Net interest margin expected to stay between 2.5% and 2.6% in FY27.
Q4 FY26 · ROA above 1%
Management confident of delivering return on assets above 1% despite ECL implementation.
Q4 FY26 · ECL impact of INR 10,000 crore, absorbable in one go
Expected additional provisions of INR 10,000 crore under ECL, can be absorbed in one year or staggered over four years.