Canara Bank eyes 8-10% loan growth; rise in corporate credit in FY23

"Overall we are targeting that by March 2023 our balance sheet size will be more than Rs 20 lakh crore as compared to Rs 18.27 lakh crore today," he said.

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The bank's Retail, Agriculture and MSME (RAM) segment, which constitutes 57 percent of its total loan book, rose by 10.94 percent in the previous fiscal. Within, retail grew by 9.51 percent, agriculture by 12.75 percent and MSME by 9.87 percent.

The corporate loan book, which witnessed a growth of 8.27 percent in FY22, is expected to grow at 10 percent. The bank is seeing good traction in its corporate loan portfolio and has a pipeline of Rs 65,000-70,000 crore.

"We are getting a lot of inquiries as far as infrastructure, renewable energy and manufacturing sectors are concerned. At least we are having about Rs 65,000-70,000 crore of corporate loan proposals with us for appraisal.

"Already, we have underwritten Hybrid Annuity Mode (HAM) projects worth Rs 35,000 crore, which will be disbursed in the current year," he said.

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On the capital raising plan, Prabhakar said with a reduction in risk-weighted assets to 72 percent from 78 percent earlier and higher Capital to Risk-weighted Assets Ratio (CRAR) at 14.90 percent, the requirement for capital has also reduced.

"As of now, we don't require any capital but to be future-ready, we will be raising at an appropriate time taking into consideration the yields," he said, adding that the bank will look to raise Rs 9,000 crore through issuance of additional tier-I and tier-II bonds in the latter part of the fiscal.

In the quarter ended March 31, 2022, the bank's Profit After Tax (PAT) jumped by 64.9 percent to Rs 1,666 crore from Rs 1,010 crore in the year-ago period. Net Interest Income (NII) grew by 24.84 percent to Rs 7,005 crore. NIM improved to 2.82 percent from 2.76 percent.

The bank saw its asset quality improving with Gross Non-Performing Assets (GNPAs) ratio declining to 7.51 percent from 8.93 percent. The net NPA ratio stood at 2.65 percent compared to 3.82 percent.

"In FY23, our net NPAs will be less than 2 percent and gross NPAs at 6 percent," Prabhakar said.

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The slippage ratio will be below 1.75 percent in FY23 and the bank is expecting recoveries of more than Rs 15,000 crore this fiscal.

The lender's exposure to Future Retail is Rs 1,400 crore and it has already recovered Rs 227 crore from the loan account, Prabhakar said. The bank has already made a provision of 60 percent for the account.