PERFORMANCE HIGHLIGHTS March 2009

Page 1www.canarabank.com Mar’09 Results

PERFORMANCE HIGHLIGHTS

March 2009


Canara .. at a GlanceCanara .. at a Glance

A Premier Nationalised Bank in India Well spread network of 2733 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/sponsored

institutions/JVs

Business Superbrand Status


FINANCIAL HIGHLIGHTS


ROBUST ROBUST PROFITPROFIT GROWTH Q4 FY09 GROWTH Q4 FY09

Q4 FY08 Q4 FY09

719

464

100

200

300

400

500

600

700

800

Net Profit(Rs. in Crore)

Incr

ease

of 55

%


ROBUST ROBUST PROFITPROFIT GROWTH FY09 GROWTH FY09

FY08 FY09

2072

1565

500

700

900

1100

1300

1500

1700

1900

2100

Net Profit(Rs. in Crore)

Incr

ease

of 32

%


PROFIT GROWTH LAST FIVE YEARSPROFIT GROWTH LAST FIVE YEARS

2,072

1,5651,4211,343

1,110

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

FY05 FY06 FY07 FY08 FY09

Rs. C

rore


BUSINESS PROFILEBUSINESS PROFILE

Mar’09 Mar’08 Y-o-Y Gr

Total Business 32511226131

0 24%

Total Deposits 18689315407

2 21%

Net Advances 13821910723

8 29%

C-D Ratio (%) 73.96 69.60 436bps

Amt. in Rs. Crore

Total Business Crossed Rs. 3.25 lakh croreGrowth over 24%


96,796

116,803107,238

154,072142,381

186,893

79,426

98,506

60,421

138,219

-13,000

7,000

27,000

47,000

67,000

87,000

107,000

127,000

147,000

167,000

187,000

2005 2006 2007 2008 2009

Rs.

Cro

re

Deposits Advances

TOPLINE GROWTHTOPLINE GROWTH

Total Business added during the year : Rs.63800 Crore


219,646

180,529165,961

132,822

110,305

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

2005 2006 2007 2008 2009

Rs. C

rore

TOTAL ASSETSTOTAL ASSETS

Total Asset size has crossed the Rs.200,000 crore mark


INCOME INCOME

Amt. in Rs. Crore

Mar’09 Mar’08 Growth Q4

FY09Q4

FY08 Growth

Total Income 19430 16414 18.38% 5500 4502 22.17%

Int. Income 17119 14201 20.55% 4654 3788 22.86%

Int. Loans/Adv 12813 9875 29.75% 3575 2621 36.37%

Non-Int. Inc 2311 2213* 4.44% 846 714* 18.51%*If the one time income of Rs.498 Cr for FY08 and Rs.278 Cr for Q4 of FY08 are reckoned, the growth works out to 35% for FY09

and 94% for Q4 of FY09


EXPENDITURE EXPENDITURE Amt. in Rs. Crore

Mar’09

Mar’08 Growth

Q4 FY09

Q4 FY08 Growth

Total Exp. 15467 1345414.96

% 4228 356318.65

%

Int. Exp. 12401 1066316.30

% 3349 286616.86

%

Op. Expense 3065 2791 9.82% 879 698

26.04%

Staff Expense 1877* 1661

12.99% 530 357

48.60%

Cost-Income Ratio (%) 43.61 48.54

-493bp

s 40.8642.6

2

-176bp

s

*Includes Rs.150 Cr provided for likely wage revision

Enterprise-wide ‘Cost Saving and Cost Control’ awareness


PROFIT GROWTHPROFIT GROWTHAmt. in Rs. Crore

Mar’09 Mar’08 Q4 FY09 Q4 FY08

Operating Profit 3964 2959 1273 939

Growth (%) 33.94 1.61 35.50 -10.74

Provisionsincl Prov for Taxation 1891 1394 554 475

Net Profit 2072 1565 719 464Growth (%) 32.42 10.15 54.90 -8.12

RoAA (%) 1.06 0.92 1.47 1.09EPS ( For Q4 Not Annualized) 50.55 38.17 17.53 11.32


EARNINGS PROFILEEARNINGS PROFILE

Mar’09 Mar’08 Q4 FY09 Q4 FY08

Net Int. Income 4718 3538 1305 922

Y-o-Y Growth (%) 33.36 -12.14 41.50 -12.92

Net Int. Margin (NIM) 2.78 2.42 2.78 2.42

Amt. in Rs. Crore

NIM Improved by 36 bps Over Mar’08


Interest Income continues to drive growth in income .. over 60% of earnings from int on advances

Contribution from fee-based business on a rise .. Fee Income up by 18% over March 2008

MAJOR COMPONENTS OF MAJOR COMPONENTS OF INCOMEINCOME

Investment Income26.7%

Int on Adv60.2%

Others3.0%

Fee Incm7.0%

Inter Bk Int3.1%

March 2008March 2008

Investment Income24.2%

Int on Adv65.9%

Others1.8%Fee Incm

7.0%

Inter Bk Int1.1%

March 2009March 2009


EARNING ANALYSIS : FY 09EARNING ANALYSIS : FY 09

Mar 2008 Mar 2009

Interest Income as a % of Total Income 86.52% 88.11%

Interest on Advances as a % of Total Income 60.17% 65.94%

Fee Income as a % of Total Income 7.05% 7.00%

Treasury Income* as a % of Total Income 26.68% 24.18%

* Int on Inv. + Trading Profit + Profit on Revaluation + Dividend Incm


BREAK-UP OF OTHER INCOMEBREAK-UP OF OTHER INCOME

Mar’09 Mar’08

FY09 Q4 FY09 FY08 Q4 FY08

Total Other Income 2311 846 2213 714 Commission & Exchange 639 198 569 164

Profit from Exchange Trans 174 14 154 38

Trading Profit 675 349 435 101

Dividend Income 38 11 223 114

Recovery in w/off A/cs 319 99 316 115

Other Misc. Income 466 175 516 182

of the above ..

Fee Income 1361 383 1157 360

Rs. in Crore

Fee-based income grew by 18% over Mar’08


MEASURES TO AUGMENTMEASURES TO AUGMENT NON INTEREST INCOMENON INTEREST INCOME

Increased thrust on Fee Income

Broadbasing of Fee Income sources

Cross Selling of Insurance

Mutual Fund Products

On-line Trading Services

Retail sale of Bullion


BREAK-UP OF PROVISIONSBREAK-UP OF PROVISIONS

Mar’09 Mar’08

FY09 Q4 FY09 FY08 Q4 FY08

Total Provision & Contingencies 1891 554 1394 475

Of Which:

Non Performing Advances 900 250 875 313

Provision for Investments 407 20 149 28

Taxation 500 200 340 100

In Rs Crore


PROFITABILITY RATIOSPROFITABILITY RATIOS

Mar’08(FY08)

Jun’08(Q1 FY09)

Sep’08(H1 FY09)

Dec’08(9M FY09)

Mar’09(FY09)

Cost of Deposits 6.80 6.36 6.60 6.81 6.87

Yield on Advances 10.22 10.06 10.50 10.69 10.79

Cost of Funds 6.24 5.90 6.07 6.23 6.32

Yield on Funds 8.31 8.12 8.39 8.57 8.73

Spread 2.07 2.22 2.32 2.34 2.41

Net Interest Margin 2.42 2.57 2.70 2.75 2.78

(In %)

Consistent Improvement in Spread and NIM


PRODUCTIVITY RATIOSPRODUCTIVITY RATIOS

Mar’09 Mar’08

Business per Employee (Rs. Crore) 7.80 6.10

Business per Branch (Rs. Crore) 118.96 97.58

Gross Profit per Employee (Rs. Lakh) 9.51 6.91

Net Profit per Employee (Rs. Lakh) 4.97 3.65

Highest Per Branch Business amongst Peers


Amt. in Rs. Crore

Figures in the brackets are percentage share in Net Investments (Domestic)

INVESTMENT PORTFOLIO INVESTMENT PORTFOLIO

Mar’09 Mar’08

Net Investments (Domestic) 57146 49053

Held to Maturity

41007

(71.8%)

28721

(58.6%)

Available for Sale

15728

(27.5%)

20128

(41.0%)

Held for Trading

412

(0.72%)

204

(0.40%)


ASSET QUALITYASSET QUALITY

Mar’09 Mar’08

Gross NPA (Rs. Crore) 2168 1273 Gross NPA Ratio (%) 1.56 1.18

Net NPA (Rs. Crore) 1507 899

Net NPA Ratio (%) 1.09 0.84

Cash Recovery (Rs. Crore) 1289 1030

Restructured a total of 72184 A/Cs, aggregating to Rs.2066 Cr in FY09 under the Special Regulatory Treatment

Intensive thrust on credit monitoring and containing slippages


BASEL II AND CAPITAL STRATEGYBASEL II AND CAPITAL STRATEGY

Comfortable Capital Adequacy Ratio

CRAR of 14.10% at Mar’09.. well above the

regulatory minimum

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


5.49%

8.01%7.01%7.17%7.81%7.29%

6.09%6.24%6.33%3.41%

0%

2%

4%

6%

8%

10%

12%

14%

Mar.05 Mar.06 Mar.07 Mar.08 Mar.09

Tier I capital Tier 2 capital

9.0% Minimum Total CRAR

6.0% Minimum Tier I CRAR

12.78% 11.22%Total CRAR

%

CAPITAL ADEQUACY – Basel IICAPITAL ADEQUACY – Basel II

13.50% 13.25%* 14.10*

(6738)

(7850)

(6925)

(8148)

(7250)

(2940)

(3372)

(4483)

(Figures in the brackets are amt. in Rs. Crore)

(7623)

(10023)

* Mar’08 and Mar’09 as per Basel II


EARNINGS PROFILEEARNINGS PROFILE

27.06

32.7634.65

38.17

50.55

0

10

20

30

40

50

60

EPS (INR)

Mar-05 Mar-06 Mar-07 Mar-08 Mar-09

146.15

171.19

197.83202.33

244.87

0

50

100

150

200

BV (Rs)

Mar-05 Mar-06 Mar-07 Mar-08 Mar-09

The Bank continued to sustain high levels of earnings. Book Value and Earnings Per Share show consistent rise, year on year

The Bank continued to sustain high levels of earnings. Book Value and Earnings Per Share show consistent rise, year on year


VALUE FOR STAKEHOLDERSVALUE FOR STAKEHOLDERS

55%

66%70%

80% 80%

0%

10%

20%

30%

40%

50%

60%

70%

80%

DIVIDEND

FY05 FY06 FY07 FY08 FY09

Dividend ... Progressive Return for the

Shareholders


SHARE HOLDING PATTERNSHARE HOLDING PATTERN

11.2%

5.6%1.8% 6.7% 1.6%

73.2%

Govt of India FIIs Resident Individuals MFs IFIs Others

As on Mar 31, 2009


BUSINESS FOCUS


CORE DEPOSITS GROWTHCORE DEPOSITS GROWTH

Amt. in Rs. Crore


Core Deposits 15012710893

6 38%

Savings Deposits 41811 35267 19%

CASA per Branch 20.55 18.12 13%

Deposits Clientele (Mn) 30.50 28.30 2.2Mn

Highest Per Branch CASA Deposit among Peers


CREDIT FOCUSCREDIT FOCUS

Amt. in Rs. Crore


Net Advances13821

9 107238 29%

Agriculture Credit 20144 17996 12%

MSME Advances 23823 18600 28%

Retail Lending 19798 17665 12%

Housing (Direct) 7896 6658 19%

Industrial Advances 52142 41435 26%

Infrastructure Advances 17313 13794 26%

Well Diversified Credit PortfolioFocus on Productive Sectors


PRIORITY SECTORPRIORITY SECTOR


Priority Credit O/s 48763 43203 13%

% to ANBC 46.02 44.15

Agriculture Adv O/s 20144 17996 12%

% to ANBC 19.01 17.70

MSME Advances O/s 23823 18600 28%

(Amt. in Rs. Crore)

Surpassed 18% Adjusted Net Bank Credit (ANBC) Norm in Agriculture


Beyond Numbers


EXPANDING THE REACHEXPANDING THE REACH

Mar’09 Mar’08 Y-o-Y Incr

Branch Network 2733 2678 55

ATM Strength 2019 2006

55 Branches added during the year

Commissioned a Branch at SHANGHAI, CHINA

ATM Tally of over 2000.. Highest amongst Nationalized Banks (includes 609 Off-Site ATMs + 187 ATMs at important Railway Stations)

150 e-kiosks for Railway Ticket Booking


EXPANDED CLIENTELE BASEEXPANDED CLIENTELE BASE

Mar’09 Mar’08Y-o-Y

Incr

Clientele Base in Mn 34.80 32.35 2.45

- No of Deposit a/cs (Mn) 30.50 28.30 2.20

- No of Borrowal a/cs (Mn) 4.30 4.05 0.25

Nearly 35 million strong clientele base

2.5 million clientele added during the year

Nearly 35 million strong clientele base

2.5 million clientele added during the year


INFOTECH PROGRESSINFOTECH PROGRESS

Mar’09 Mar’08

Core Banking Branches 1053 569

ATMs 2019 2006

AWB Branches 2062 1911

IMB Branches 1362 1200

NEFT and RTGS All Branches 2675

Debit Card Base (Lakh) 57.51 32.87

77% Business under Core Banking Solution

Largest ATM Network amongst Nationalized Banks

77% Business under Core Banking Solution

Largest ATM Network amongst Nationalized Banks


AWARDS/ACCOLADES AWARDS/ACCOLADES

Golden Peacock National Training Award 2008 for excellence in training.

Global HR Excellence in Training, an award conferred by the Asia Pacific HR Congress,

Best Corporate Social Responsibility Practice Award, instituted by BSE, NASSCOM and Times Foundation.

Two Silver Corporate Collateral Awards for Best Corporate Ad in the Print Media and Best Corporate Film on Corporate Social Responsibility at the Public Relations Council of India Awards 2009.


PLANS FOR FY10PLANS 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

Leveraging the new brand identity to improve standard of customer service and attract younger clientele

All branches are slated for full coverage under CBS by March 2009

Increasing technological automation will be leveraged fully to provide a wide range of value-added services to our vast cross-section clientele and sustain business growth.

Strengthening overseas presence

RBI approval for 10 overseas Branches/offices obtained… Johannesburg, Frankfurt, Muscat, Manama, QFC-Qatar, Leicester, New York, Sao Paulo, Dar-er-Salam and Tokyo


To Expand Credit in FY10


INITIATIVES… To Expand Credit INITIATIVES… To Expand Credit

Meeting emergent needs of corporates, MSME, housing, auto, infrastructure and other sectors, hit by economic downturn

Resorting to effective utilization of resources- deposits, refinance, market borrowings.

Continuing thrust on increasing exposure to all productive sectors- Agriculture, MSME, manufacturing and services

Special incentives for MSME, Housing and Auto sectors

Extensive support to NBFCs and Mutual Funds


INITIATIVES… To Expand CreditINITIATIVES… 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

Tie-ups with Auto Majors- M/s Hyundai Motor India Ltd, M/s. Swaraj Mazda Ltd, M/s. Maruti Suzuki Ltd and M/s. Tata Motors to push auto loans


SPREAD MANAGEMENT SPREAD MANAGEMENT

Spread Management Challenges on Sustaining Net Interest Margin

… southward movement in interest rates

Reduction in BPLR - from 14% to 13.25 (w.e.f 10th Nov’08)

from 13.25% to 12.50% (w.e.f 1st Jan’09)

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 Core Deposits, including CASA

Substitution of high cost preferential rate deposits with low cost term deposits

Deployment of resources in better yielding productive assets

Focus on Corporates

Intensive thrust on credit monitoring and containing slippages


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• Making ATMs profit centres

•Rationalization/Relocation of ATMs

•Increasing number of Debit Cards and hits per ATM

•Encouraging Customers to use ATMs and other e-banking channels

Reducing burden, improving pool of non-interest

income by Mar’09

Enterprise-wide ‘Cost Saving and Cost Control’

awareness


Documents

PERFORMANCE HIGHLIGHTS March 2009