Canara Bank’s Interest costs (33% yoy) far exceeded the rise in interest income (18% yoy) and resulted in a 13% fall in the net interest income. Bank is getting rid of low-yield loans,and is expected to lend more aggressively in FY09, thereby earning higher interest and income. Operating expenses increased 10% yoy to Rs. 7 bn. The Bank’s employee costs declined by 4%, owing to its virtually stagnant workforce.
Non-interest income increased 14% yoy to Rs. 7.1 bn. On yearly basis, the growth was impressive at 53%. As the Bank is venturing into insurance and asset management businesses, the growth in other income is believed to be sustained. Deposits grew by 8% yoy to Rs. 1.5 tn.
Canara Bank reported a Net Profit of Rs 1565 crore for FY08 a growth of 10.1% over previous year. Fully diluted EPS for FY08 is Rs 38.