CORPORATE PRESENTATION – JANUARY 2017
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JANUARY 2017
PRIVATE & CONFIDENTIAL
2
AGENDA
JANUARY 2017
1
CANARA BANK OVERVIEW
2
KEY INVESTMENT HIGHLIGHTS
3
ASSET QUALITY
4
GROWTH STRATEGIES
PRIVATE & CONFIDENTIAL
3
DECADES OF HISTORY
1st position in MSE lending for
FY 14 & FY 15 by GoI
Indy Wood CSR Excellence
Award 2016 for outstanding
achievement under CSR
Best Bank under PMEGP, South
Zone in the field of Khadi and
Village industries for FY14 &
FY15
SKOCH Order of Merit Award
for initiatives under SME
Enablement, Financial Inclusion
and mWallet for FY 15
Dun & Bradstreet Banking
Award 2016 for the Best Bank
under PSL and Best Retail
growth performer among PSBs
National Award for excellence
in lending to Micro Enterprises
– 1st position in FY 14 and 2nd
position in FY 15
Core Banking
Solution
Foray into
implemented
Asset
in all domestic
Management
branches
and Life
2010
Insurance
8th overseas
branch at
through joint
ventures
2016
Dubai is
2008
inaugurated
Canara Bank
Listing through
Initial Public
Offer
Registration
of Canara
Hindu
Permanent
Fund Limited
Launching of a
“New Brand
2006
Identity”
1910
Renaming as
Canara Bank
(Tanzania)
Limited, a
wholly owned
subsidiary is
Nationalization
of the Bank
2002
1976
1906
2007
Centenary year
opened
of the Bank
Core Banking
1969
Inauguration
of 1000th
branch
Solution
implemented
in select
branches
111 Years of Celebrated History
JANUARY 2017
PRIVATE & CONFIDENTIAL
4
CANARA BANK OVERVIEW : H1 FY17 HIGHLIGHTS
Net Advances
Deposits
INR 3,274 bn
Net Interest Income
CET-1
INR 48 bn
8.25%
INR 4,843 bn
INR Bn
INR Bn
INR Bn
FY 2016
3,250
FY 2016
4,797
FY 2016
98
FY 2016
8.18%
FY 2015
3,303
FY 2015
4,737
FY 2015
97
FY 2015
7.37%
Non Interest Income
Net Profit
GNPA
INR 7 bn
9.81%
INR 35 bn
INR Bn
NNPA
6.69%
INR Bn
FY 2016
51
FY 2016
(26)
FY 2016
9.40%
FY 2016
6.42%
FY 2015
47
FY 2015
29
FY 2015
3.89%
FY 2015
2.65%
JANUARY 2017
PRIVATE & CONFIDENTIAL
5
CANARA BANK AT A GLANCE
Bank Overview
Shareholding Pattern As On December 31, 2016
One of the leading public sector commercial banks in India
0.5%
1.2%
7.9%
5.9%
Among the top 5 public sector banks in terms of assets as on
4.5%
March 31, 2016 as per the data published by Indian Banks’
Association
13.7%
66.3%
One of the largest nationalized banks in India in terms of total
advances and deposits, which is Rs. 8,117.73 billion as of
September 30, 2016
Engaged in a wide variety of banking activities such as:
GoI
LIC of India
HDFC Trustee
FPIs
Reliance Life AMC
FIs/ Banks
Others
Presence Across the Value Chain
Corporate Lending – Comprises a wide variety of
51.00%
100.00%
43.45%
69.14%
70.00%
100.00%
banking activities for large and medium corporations
Priority Sector and Retail Sector Lending – Provides
funding to Priority & Retail sectors including loans to
agriculture, MSME, Housing & Education etc
51.00%
International Banking – Caters to the financial
requirements of Indian exporters and importers
Other services – Includes services such as asset
management, factoring, bancassurance etc
JANUARY 2017
Commercial Indo Bank
LLC (JV with SBI)
35.00%
Canara Bank Tanzania
Limited
100.00%
PRIVATE & CONFIDENTIAL
40.00%
35.00%
Commonwealth Trust
(India)
30.00%
6
AGENDA
JANUARY 2017
1
CANARA BANK OVERVIEW
2
KEY INVESTMENT HIGHLIGHTS
3
ASSET QUALITY
4
GROWTH STRATEGIES
PRIVATE & CONFIDENTIAL
7
KEY INVESTMENT HIGHLIGHTS
1
Strong Brand Recognition & Pan India Presence
2
Efficient Use Of Digital Technology
3
Diversified Credit Portfolio
4
Diversified Sources Of Income
5
Efficient Asset Liability Management
6
Experienced And Professional Management Team Backed By GoI
JANUARY 2017
PRIVATE & CONFIDENTIAL
8
1
STRONG BRAND RECOGNITION & PAN INDIA PRESENCE (1/2)
Pan India Network As On November 30, 2016
Domestic Branch Network
5,931
5,849
32/32
16/28
5,682
56/55
199/220
83/96
180/251
181/496
143/182
7/8
8/8
540/803
70/78
235/359
3/3
10/10
4/5
136/181
284/361
214/274
143/199
13/15
5/5
76/79
3/3
FY 16
As on Nov 30, 2016
Bank has 8 overseas branches in Johannesburg, New York, London,
Leicester, Shanghai, Manama, Hong Kong & Dubai
Bank has 182 hi-tech e-lounges in select branches with facilities like
169/210
1/1
FY 15
384/684
Cash Deposit Kiosk with voice guided system, Cheque deposit kiosk etc
165/361
Domestic ATM Network
54/82
266/401
974/2381
445/606
11/16
829/1814
Domestic Branches/ ATMs
5931/ 10,308
JANUARY 2017
8,533
9,251
FY 15
FY 16
10,308
2/2
PRIVATE & CONFIDENTIAL
As on Nov 30, 2016
9
1
STRONG BRAND RECOGNITION & PAN INDIA PRESENCE (2/2)
Branch Foothold In Rural And Semi-Urban Areas
17%
18%
20%
19%
29%
32%
32%
FY 15
20%
FY 16
19%
32%
31%
31%
Rural
Semi-Urban
As on Nov
30, 2016
Urban
Metro
Our extensive branch network allows us to provide banking services to different types of customers across India
We offer a full range of banking products and services including short-term and long-term deposits, secured and unsecured loans, internet banking, credit
cards, life insurance, merchant banking, agricultural banking products and project finance loans
Customer Base
Specialized Branches Focusing On Niche Areas
In Mn
76
72
66
SME Branches
166
Prime Corporate Branches
12
Mid-corporate Branches
26
Asset Recovery Management Branches
21
Others
62
Total
FY 15
JANUARY 2017
FY 16
As on Nov 30, 2016
287
As on Nov 30, 2016
PRIVATE & CONFIDENTIAL
10
2
EFFICIENT USE OF DIGITAL TECHNOLOGY (1/2)
Mobile Banking Customers
E-Transactions As A % Of Total Transactions
59.3%
In lakhs
39
40
FY 16
H1 FY17
54.2%
50.2%
22
FY 15
FY 16
H1 FY 17
FY 15
Bank’s emphasis on promoting digital technology has led to significant
increase in the number of e-transactions
Debit & Credit Cards Customers
Internet Banking Customers
In lakhs
In lakhs
24
322
26
343
256
15
FY 15
FY 16
H1 FY17
Credit and debit cards (global & domestic) issued in association with VISA,
Master Card and NPCI (only for debit cards)
FY 15
JANUARY 2017
FY 16
H1 FY17
Established network of 4,167 merchants and 10,309 ATMs as of November
30, 2016
PRIVATE & CONFIDENTIAL
11
2
EFFICIENT USE OF DIGITAL TECHNOLOGY (2/2)
Technology Driven Bank - Key Technology Initiatives
Digital Solutions
Mobile Based Solutions
Canara Swipe (Missed call solutions in single app)
Canara easyCash (cash withdrawal facility for migrant
eMpower (Bank’s UPI App)
population)
Canara Cart (Umbrella app - all mobile based apps)
eKYC for Biometric, Aadhaar based KYC Biometric
Canara mServe (Blocking/Unblocking of cards & other
access for lockers
services)
Online application for SB accounts & PPF accounts
Canara e-Infobook (e-Passbook) & Canara m-Wallet
Aadhaar number registration through online banking
SMS Solutions (Balance enquiry etc)
and ATMs
Data Security Initiatives
JANUARY 2017
Other Initiatives
Data Centre in Bangalore
Canara Geo Locate (Mobile app for locating branch
Disaster Recovery Centre in Mumbai to prevent and
and ATMs)
reduce business interruption and data loss in case of
Green Pin (Generation of ATM Pin by customers
disasters
themselves)
“Near Site” Disaster Recovery Centre in Bangalore to
Periodical conduct of Disaster Recovery drills to
achieve near zero data loss
ensure readiness to face any untoward events
PRIVATE & CONFIDENTIAL
12
3
DIVERSIFIED CREDIT PORTFOLIO (1/2)
Net Advances
Net Advances Profile*
Rs. Bn
3,303
54.4%
57.2%
58.1%
45.6%
42.8%
41.9%
FY 15
FY 16
H1 FY17
3,274
3,250
FY 15
FY 16
H1 FY17
Thrust On Growing Retail Book*
2.4%
2.6%
4.1%
5.7%
2.6%
2.7%
3.0%
4.2%
3.1%
4.2%
6.0%
6.6%
45.4%
20.7%
17.3%
16.4%
H1 FY17
FY 15
FY 16
H1 FY17
20.9%
17.3%
16.4%
17.2%
17.3%
38.3%
42.6%
FY 15
FY 16
20.7%
13.6%
Agriculture + MSME
* On a standalone basis
JANUARY 2017
Retail
RAM
Top 5 Industries Wise Gross Loan Portfolio*
23.0%
27.4%
Corporate
Infrastructure
Others
Infrastructure
Textile
Engineering
PRIVATE & CONFIDENTIAL
Basic Metal & Metal Products
Food Processing
13
3
DIVERSIFIED CREDIT PORTFOLIO (2/2)
Priority Sector Loans
Priority Sector Loans
Rs. Bn
49.3%
52.1%
40.9%
1,456
1,182
FY 15
FY 16
Total PSL
12.8%
11.8%
11.8%
37.4%
42.1%
41.2%
49.8%
46.2%
46.9%
FY 15
FY 16
H1 FY17
1,549
H1 FY17
Agriculture
PSL as a % of Adjusted Net Bank Credit
Retail Advances
MSME
Other Priority Sector
Retail Advances
Rs. Bn
16.7%
16.7%
13.3%
12.5%
13.5%
545
24.9%
22.3%
23.2%
8.0%
8.4%
52.8%
57.3%
54.9%
FY 15
FY 16
H1 FY17
12.8%
541
423
FY 15
Total Retail Loans
8.9%
FY 16
H1 FY17
Retail as a % of Total Loans
We deliver retail products through our Retail Asset Hubs and retail lending
marketing teams at major cities across India
JANUARY 2017
Housing
Vehicle
PRIVATE & CONFIDENTIAL
Personal
Education
14
4
DIVERSIFIED SOURCES OF INCOME (1/2)
Revenue From Different Business Segments
Non Interest Income As A % Of Total Income*
Rs. Bn
Rs. Bn
228
204
155
126
128
122
34
95
79
FY 15
14.0%
49
46
FY 16
Retail Banking Operations
65
9.4%
10.0%
FY 15
FY 16
H1 FY17
H1 F17
Wholesale Banking Operations
Non-Interest Income
Treasury Operations
Non Interest Income as a % to Total Income
Non Interest Income*
Other Income
Fee Income
Rs. Bn
Rs. Bn
20
18
9
8
11
12
10
9
6
FY 15
11
10
FY 16
Commission, Exchange & Brokerage
Service Charges
8
Total Fee Income
6
6
4
5
H1 FY17
7
2
FY 15
Treasury Income
FY16
Exchange Transactions Income
H1 FY17
Recoveries in w/o a/cs
* Standalone
JANUARY 2017
PRIVATE & CONFIDENTIAL
15
4
DIVERSIFIED SOURCES OF INCOME (2/2)
Third Party Products
Tie-ups
Tie up with Canara HSBC OBC Life Insurance and Canara Robeco Asset Management Company for cross selling
Tie up with United India Insurance to sell non-life insurance policies
Corporate Agency agreement with Apollo Munich Health Insurance for marketing of health insurance products
Corporate Agency agreement with Export Credit Guarantee Corporation for marketing of export policies
Depository
Participant Services
Serving as a Depository Participant of National Securities Depository Limited since 1997
Network of 47 DP service centres spread across 33 locations in India as of November 30, 2016
Government
Banking
Retail Selling of
Government
Securities
Agriculture
Innovation Centre
Food Credit
JANUARY 2017
Handle various government business products like direct and indirect tax collections, salary and pension payments etc
We market PPF scheme, pension accounts, e-transactions, e-payment of taxes and e-stamping business to improve
government business
We sell Government Securities on a retail basis through our branches
Value G-Secs at market prices declared by FIMMDAI for securities held in HFT and AFS categories
Agriculture Innovation Centre (AIC) is the first consultancy service centre for agriculture and related activities
AIC facilitates modernization of agriculture activities and businesses and appraises agriculture based projects
Since its establishment in 1988, AIC has appraised more than 1,670 projects with a project cost of Rs. 8,233 crores as
of November 30, 2016
One of the consortium members in extending food credit to Food Corporation of India
We play a significant role in safeguarding the interest of farmers and financing food credit through FCI
PRIVATE & CONFIDENTIAL
16
5
EFFICIENT ASSET LIABILITY MANAGEMENT
Deposit Profile – Reducing Reliance On Bulk Deposits
Deposits
Rs. Bn
4,843
4,797
4,737
FY 15
6.0%
8.3%
4.7%
27.6%
25.5%
29.9%
35.9%
38.7%
24.0%
25.8%
27.2%
FY15
FY16
H1FY17
31.7%
FY 16
6.8%
1.8%
6.2%
CASA
H1 FY17
Retail TD
Bulk TD
CD
Overseas TD
Post demonetization CASA stands at 32.1% as of December 31, 2016
Liquidity Coverage Ratio
CASA Deposits
Rs. Bn
1,317
Financial Year
Minimum Requirement
Maintained
by Bank
1,235
CY 2015
FY 2015-16
1,135
H1 FY 2016-17
FY 15
JANUARY 2017
60%
FY 16
84.92%
CY 2016
70%
CY 2016
70%
99.74%
H1 FY17
PRIVATE & CONFIDENTIAL
17
6
EXPERIENCED AND PROFESSIONAL MANAGEMENT TEAM
BACKED BY GOI
T N Manoharan, Chairman
Rakesh Sharma, MD & CEO
Around two decades of experience in the banking industry
Chairman of the Committee on Education and Centre for Excellence
of South Asian Federation of Accountants for the year 2004
Conferred with the “Padma Shri” by the President of India in 2010
Over 30 years of experience in the Banking industry
Was associated with SBI as Chief General Manager and was the
head of mid-corporate accounts in the Andhra Pradesh region
Held the post of MD & CEO of Lakshmi Vilas Bank
Uma Shankar, RBI Nominee Director
Chief General Manager, Department of Currency Management, RBI
Acted as the Regional Director of RBI, Bangalore
Served on the boards of Corporation Bank and UCO Bank
Venkatachalam Ramakrishna Iyer, Shareholder Director
Retired Deputy Managing Director of State Bank of India
Nominee Director of SBI in Usha Martin Limited, Kolkata
Was the Nominee Director on the board of SBI General Insurance
Company Limited and SBI Global Factors Private Limited
Dina Bandhu Mohapatra, Executive Director
Has over 31 years of experience in various areas of banking
Was the head of Hong Kong and Singapore branches of the Bank of
India
Harideesh Kumar B, Executive Director
Over 38 years of experience working in banks across the country
Was in charge of Vijaya Bank’s regional offices at Chandigarh,
Bangalore and Delhi
Was the General Manager of Vijaya Bank’s Delhi region
Suchindra Misra, Government Nominee Director
Joint Secretary at the Department of Financial Services, Ministry of
Finance
Holds a Bachelor’s degree in Science and a Postgraduate Diploma in
Business Management in Marketing and Finance
Mahadev Nagendra Rao, Shareholder Director
Retired Deputy Managing Director of the State Bank of India
Worked as the MD & CEO of SBI Life Insurance Company Limited
Independent director of IDBI Federal Life Insurance Company
Capital Infusion By Government Of India
Rs. Bn
9.5
5.0
P V Bharathi, Executive Director
Over 30 years of banking experience
Certified associate of the Indian Institute of Bankers
Member of the Board of Directors of Canbank Venture Capital Ltd.,
Can Fin Homes Ltd., Canara HSBC OBC Life Insurance Co Ltd.
Krishnamurthy H, Shareholder Director
Chief Research Scientist at the Indian Institute of Science, Bengaluru
Holds a Masters degree in Engineering
Keen interest in banking technologies
JANUARY 2017
Infusion
Price (Rs.)
5.7
FY 14
FY 15
FY 16
273.84
408.95
340.72
PRIVATE & CONFIDENTIAL
18
AGENDA
JANUARY 2017
1
CANARA BANK OVERVIEW
2
KEY INVESTMENT HIGHLIGHTS
3
ASSET QUALITY
4
GROWTH STRATEGIES
PRIVATE & CONFIDENTIAL
19
ASSET QUALITY OVERVIEW (1/2)
GNPA & NNPA
Cash Recoveries
Rs. Bn
60
9.8%
9.4%
6.4%
48
3.9%
2.7%
FY 15
FY 16
GNPA
20
6.7%
H1 FY17
NNPA
Outstanding Restructured Asset Portfolio
FY 15
FY 16
H1 FY17
We have taken several initiatives to contain slippages and increase
recoveries as mentioned below:
Identification of stressed a/cs for restructuring in time
One Time Settlement sessions
Regular follow-up of overdues in loan a/cs
E-auction for the sale of seized assets and stringent recovery
measures against willful defaulters
Sector Wise Restructured Assets
Rs. Bn
3.2%
2.0%
1.8%
89.8%
89.2%
90.0%
7.0%
8.8%
8.2%
FY 15
FY 16
H1 FY17
284
232
234
8.5%
6.9%
FY 15
Restructured assets
FY 16
6.9%
H1 FY17
Restructured assets as a % of gross advances
Agri + MSME
Large Advances
Others
Others includes restructured Housing Loans also
JANUARY 2017
PRIVATE & CONFIDENTIAL
20
ASSET QUALITY OVERVIEW (2/2)
Sector Wise NPA Slippages As A % To Total Slippages
Stabilizing Slippages Ratio
Fiscal Year
38%
7%
FY 15
108.7
FY 16
247.2
9M FY17
85.5
17%
18%
Total Slippages (in
Rs. bn)
25%
27%
4%
FY 16
FY 15
21%
9M FY17
5%
58%
44%
37%
Large Industries
Agri + MSME
Medium Industries
Others
Sector Wise NPA Outstanding As A % To Total NPA
Fiscal Year
FY 15
Total NPA
outstanding (in
Rs. bn)
17%
15%
5%
6%
FY 15
130.4
17%
4%
45%
FY 16
9M FY17
57%
22%
FY 16
316.4
9M FY17
343.4
24%
34%
Large Industries
JANUARY 2017
55%
Agri + MSME
Medium Industries
PRIVATE & CONFIDENTIAL
Others
21
AGENDA
JANUARY 2017
1
CANARA BANK OVERVIEW
2
KEY INVESTMENT HIGHLIGHTS
3
ASSET QUALITY
4
GROWTH STRATEGIES
PRIVATE & CONFIDENTIAL
22
FUTURE GROWTH STRATEGIES
8
7
1
Divestment In Non-Core Business
Geographical Presence

Focus on divestment in non-core businesses


Bank has proposed to divest 13.45% stake in Can
Fin Homes and entire 70% stake in Canbank
Factors
Leverage domestic
expansion

Leverage Lead Bank status and brand recall to
expand domestic presence
Capital Efficiency & Profit Maximization

Implement
robust
risk
architecture and sound risk
systems

Deloitte to assist in the implementation of an
Enterprise-wide Integrated Risk Management
Framework
6
links
for
Asset Quality & Cash Recoveries
2
management
management

Mission Samadhan: Conduct recovery meets/
Adalats/ Mega Adalats

4 levels of control mechanism starting branch,
RO, Circle Office to HO

Separate division for Asset recovery branches
3
Technology Driven Approach
international
CASA Deposits & Credit Portfolio

Leverage on technology to maximise efficiency in
operations

Increased focus on marketing campaigns to
increase CASA to reduce cost of funds

Focus on transforming the Bank into a
knowledge based, customer-centric bank

Increased focus on retail loan portfolio in
agriculture, MSME, Housing and Vehicle
5


JANUARY 2017
4
Branch Transformation
Implemented Project Shikhar with the aim of
making the Bank more Responsive, Accessible,
Convenient and Energized
Branches are given different star ratings based on
ATM hits, CASA %, Fee income growth, etransactions etc
Fee Based Income

Increase fee income by introducing new
products and cross sell offerings

Focus on bancassurance, cross-selling of mutual
fund products, loan syndication among others
PRIVATE & CONFIDENTIAL
23
THANK YOU
ANNEXURES
CONSOLIDATED FINANCIALS
Balance Sheet Summary
In Rs. million
FY15
FY16
H1 FY17
Cash & Balances with RBI
219,768
206,650
205,351
Balances with Bank & Money at
Call & Short Notice
266,708
360,787
428,609
Investments
1,521,217
1,524,698
1,522,588
Advances
3,302,939
3,249,924
3,274,351
Fixed Assets
69,699
72,058
7,1745
Other Assets
205,244
223,132
235,463
Total Assets
5,585,575
5,637,249
5,738,108
4,752
5,429
5,429
320,165
318,667
324,821
4,737,249
4,797,489
4,843,383
Borrowings
25,7628
269,634
255,868
Other Liabilities and Provisions
261,994
241,537
303,989
5,585,575
5,637,249
5,738,108
Paid-up Capital
Reserves & Surplus
Deposits
Total Liabilities
JANUARY 2017
PRIVATE & CONFIDENTIAL
26
CONSOLIDATED FINANCIALS
Profit & Loss Account Summary
In Rs. million
FY15
FY16
H1 FY17
Interest Earned
438,134
44,039
206,363
Interest Expended
341,331
342,629
188,693
Net Interest Income
96,802
97,765
17,670
Other Income
47,334
51,313
34,477
Operating Income
144,137
149,078
52,147
Operating Expenses
72,660
75,919
41,897
Operating Profit
29,310
(25,351)
40,250
Net Profit
28,647
(26,070)
7,126
FY15
FY16
H1 FY17
Earnings Per Share (Basic)
62.1
(46.7)
13.1
Earnings Per Share (Diluted)
62.1
(46.7)
13.1
Return on Net Worth
10.6%
(9.7)%
5.2%
Return on Assets
0.6%
(0.5)%
0.3%
Net Asset Value Per Share (in Rs.)
584
510
501
CRAR
10.6%
11.1%
12.2%
Tier 1 Ratio
8.0%
8.8%
8.9%
Key Ratios
JANUARY 2017
PRIVATE & CONFIDENTIAL
27