Dear Shareholders,
I am honoured to present the Annual Report of our Bank for the
Financial Year 2024-25 - yet another remarkable year, that stands as a testament to our
commitment to excellence, innovation and unwavering dedication to create value for each of
our stakeholders.
I express my heartfelt gratitude to each one of you for the invaluable
partnership with Canara Bank, which has been instrumental in guiding the Bank through the
current landscape. Your steadfast support over the years has facilitated our Bank's
evolution as a Financial Conglomerate, ensuring our continued prominence within the
industry as reflected in the key financial metrics. With your full support, we are
confident of navigating the ensuing financialyear as well, even amidst a volatile and
dynamic turn of events on the domestic front and across the globe.
Global economy a mixed bag: On the global macroeconomic front, the
latter half of 2024-25 has been unprecedented. As per the latest IMF World Economic
Outlook - April 2025, the global growth forecast for 2025 has been revised downwards from
3.1% to 2.8%, marking a 30 basis points decrease from its January 2025 update. However,
reciprocal tariffs intiated by the US and the related standoff with China seems to be
ebbing if the truce agreed between them, is any indication. If trade war fears recede and
stability returns global GDP growth might exceed IMF forecast.
Domestic economy displays resilience: Amidst this global backdrop,
the outlook for domestic economic activity remains relatively robust, driven by sustained
push in public capex, momentum building up in the manufacturing and services sectors,
improving business sentiment and healthy Corporate & Bank balance sheets. In its April
2025 update to the World Economic Outlook, the International Monetary Fund (IMF) has
maintained India's growth projection for FY 2025-26 at 6.3%. The World Bank has pegged its
growth forecast for the Indian economy for FY 2025-26 at 6.3%, down from its previous
estimate of 6.7%, but still helping us to retain the fastest growing economy tag. The Free
Trade Agreement (FTA) with the UK and the impending bilateral trade agreement with US will
provide further impetus to exports and economic growth. As per Reserve Bank of India (RBI)
forecast, India's economic growth at 6.5% for FY 2025-26 and headline inflation at 4%
assuming a normal monsoon.
Banking sector landscape: Favourable domestic macroeconomic
conditions supported credit growth of banks in FY25. However, banking system liquidity
remained tight for most part of the year amidst focus on withdrawal of accommodation by
RBI to ensure that inflation progressively aligns with the target. Tight liquidity, as an
outcome of deposit growth lagging credit growth, led to competition for resources leading
to pressure on margins. However since February 2025, RBI started the easing cycle with a
repo rate cut of 25 bps followed by another 25 bps on April 9, 2025. Another significant
to maintain a liquidity surplus of 1% of NDTL in the banking system. Other factors like
low inflation and the introduction of bond forwards helped Central and State Government
bond yields to stay benign. Our Bank achieved spectacular results for the year ended March
2025. Despite challenges, Return on Assets increased by 8 bps to 1.09% for the full year
ended March 2025, while global business was Rs.25.30 lakh Crore accompanied by a 16.99%
year-on-year growth in Net Profit to Rs.17,026.7 Crore. Asset quality improved
substantially with a 129bps y-o-y decline in Gross NPA ratio to 2.94% in March 2025.
Aligned with the Government's focus on financial inclusion, the Bank diligently achieved
the mandated targets under priority sector lending.
Robust economic growth and healthy balance sheets of banks bode well
for credit growth in FY26. Nevertheless, the banking landscape is changing with the
evolution of Artificial Intelligence (AI), Data Analytics, Internet of Things (IoT),
Advanced Technology used in Digital Rupee Application and enhanced Cyber Security
frameworks.
Key digital initiatives:
Bank is at the forefront in Artificial Intelligence and has implemented
both Gen AI and Agentic AI use cases, by going a level further. The Bank has Gen AI use
cases to ensure operational efficiency, better customer experience, data driven decision
making, better compliance and audit functions. Agentic AI use cases include inspection,
data quality management and augmented virtual reality assistance for customers. A couple
of projects involving employee and customer experience are live while others involving
operational efficiency are in exploration / proof of concept stages.
Bank is leveraging other advanced new-age technologies such as
IoT, Near Field Communication (NFC) and Geospatial technology for providing services such
as e-Surveillance of ATMs to prevent ATM related frauds, Tap & Pay services, potential
business identification etc
Bank has made use of permitted advanced technology for providing
Digital Rupee Application to its customers. Bank has onboarded M/s. Deloitte to enable it
to build the Digital Personal Data protection policy and Consent Management Framework to
comply with the Digital Personal Data Protection Act (DPDPA). The bank has drafted key
policies in this regard and has appointed a Data Protection Officer.
The bank will also focus on full tool integration, employee training
and audit readiness. The bank is embedding privacy into its operations ensuring that
stakeholder data is handled responsibly and securely.
The Bank has integrated with the Unified Lending
Interface (ULI) developed by RBI Innovation Hub, to enhance digital
lending journeys. This collaboration began in 2022 with Kisan Credit Card (KCC) loans
below INR 1.6 lakh, utilizing end-to-end integration with direct land search APIs. ULI
also offers a range of APIs for MSME loans, including access to GST details, account
aggregator data, and Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE)
eligibility. Its adoption has led to faster loan approvals with minimal customer
disruption.
The Bank has a board-approved fintech policy. The Bank has partnered
with API-based fintech companies such as Perfios, ScoreMe and others that enable seamless
data verification and digital lending processes, making credit more accessible to
customers. The Bank has also tied up with National E-governance Services Ltd. (NeSL) to
digitize document execution by simplifying and accelerating legal formalities. Bank is
also leveraging solutions from Sesame Software to strengthen SMA (Special Mention Account)
monitoring and collections, thereby strengthening risk management frameworks.
Various cyber security related initiatives have been
undertakenonacontinuousbasistocreateawareness about recent trends in this domain. Cyber
Jagrukta Diwas is being celebrated on first Wednesday of every month. Every year, October
is being celebrated as National Cyber Security Awareness Month (NCSAM), the target
audience being all stakeholders including employees, customers, vendor partners etc.
Awards and recognitions:
Bank is a recipient of several awards and accolades. These include:
The Golden Globe Tiger Award for "Excellence in
Training" initiated by World HRD Congress.
Conferred with the "PSU Data Quality Champion FY
25'' and won the Award for overall Best Data Quality amongst all Public Sector
Banks by TransUnion CIBIL.
WarriorAward for Execution of Digital & Paperless
documentation in Gold Loans organized by the NeSL.
Prestigious Rajbhasha Kirti Puraskar in region C' for
the bank's quarterly in-house magazine 'Canara Jyoti'.
Canara Bank In-House Magazine "Shreyas" and Hindi
Magazine "Canara Jyoti" won awards under the Best In-House Magazine category in
the 32nd Edition of Global Brand Excellence Awards conducted by World Brand Congress.
Silver Award and an award for API Banking under Banking,
Financial Services and Insurance (BFSI) Category at Skoch Award ceremony on 30th November
2024.
IBS Intelligence (IBSi) Global Fintech Innovation Awards - Mule
Detection using ML.
Indian Green Building Council (IGBC) felicitated Canara Bank
with IGBC Green Champion Award
2024 in the category of financial sector enterprises with large-scale
adoption of green bank branches during the 22nd World Green Building Council (GBC)
conference on 14-16 November 2024 at Bengaluru.
Excellent practices under adoption of Environmental, Social and
Governance (ESG) Initiatives award at the 2nd Indian Chamber of Commerce (ICC) Emerging
Asia Banking Conclave 2024 and Finnoviti Award for 'CANARA Digital Rupee' application on
19th June 2024.
First Prize under category of Best Lenders (both Public &
Private sector) for outstanding achievement under PM SVANidhi 2023-24.
Financial inclusion and social responsibility: Under Pradhan Mantri
Jan Dhan Yojna (PMJDY) Bank has opened 2.16 Crore accounts. The Bank has also enrolled in
schemes like Pradhan Mantri Jeevan Jyothi Bima Yojna (71.89 Lakh), Pradhan Mantri Suraksha
Bima Yojna (231.96 lakh) and Atal Pension Yojna (49.68 lakh). Bank is active in community
initiatives through various activities like training unemployed rural youth, scholarship
to meritorious SC / ST Girl students, renovation of schools, provision of infrastructure
facilities to needy educational institutes, provision of primary health care, community
development, Swachh Bharat Mission etc.
Sustainability and ESG initiatives: The Bank is actively focussed
on sustainability goals. Bank has partnered with an industry expert to publish its
Sustainability reports, establish a Climate Risk Management Framework, identify the risks
associated with climate change and take steps to scrutinise ESG risks. Bank has actively
participated in the RBI's Green Bond Issuance programme.
Priority sector initiatives: Bank is at the forefront in priority
sector initiatives and major initiatives during FY25 were as below:
Rolling out SHG loans through digital lending platforms
pan-India.
Launched Krisi Vasant Core Agri Fresh Disbursement campaign,
achieving 115% of the target.
Actively participated and achieved allotted targets under
Pragati' and Arise' campaign launched by Ministry of Agri and Farm
Welfare.
Al credit linked govt sponsored schemes received through Jan
Samarth portal have been converted into business.
Under Govt sponsored schemes PM Kusum, Compressed Biogas and
ethanol blended petrol, bank achieved yearly growth of 44%, 66% and 30% respectively.
Bank is also undertaking initiatives to empower women, weaker
sections and farmers through various other priority sector initiatives which also form
part of the financial inclusion agenda.
Geographic expansion: As on 31.03.2025, Bank had 3139 branches in
rural category. Each year a good number of banking outlets are opened in Unbanked Rural
Centres (URC). In FY25, the bank opened 270 branches (250 General & 20 Specialised)
out of which 38 were in unbanked rural areas.
Way forward: The Bank is well-positioned to capitalize evolving
business opportunities in a dynamic landscape. Bank has been conducting "Strategy
meetings" for effective strategy formulation and fostering alignment with its vision
among all stakeholders. The bank is steadfast in its commitment to its founding principles
of serving the society at large.
I extend my heartfelt gratitude to all stakeholders - including
shareholders and customers - for their unwavering support and patronage. Further, I extend
genuine gratitude to all Canarites, whose contribution has been pivotal to the Bank's
excellence and continued growth.
I acknowledge with gratitude the support and guidance received from the
Government of India and the RBI. I thank the Securities & Exchange Board of India
(SEBI), Insurance Regulatory and Development Authority of India (IRDAI), National Bank for
Agriculture and Rural Development (NABARD), National Payment Corporation of India (NPCI),
National Housing Bank (NHB) and other key institutions and regulatory bodies for reposing
faith in Canara Bank's professional prowess and capabilities. My gratitude is also
due to the Indian Banks' Association (IBA) which has been a key pillar of support and
a bridge between banking sector, regulatory bodies and Ministries. I also thank the
investor community and media for their constructive coverage. My appreciation is due to
the esteemed members of the Board and the Executive team led by the Managing Director
& Chief
Executive Officer, the Auditors and the Legal Advisors for their
unstinted guidance, support and co-operation. We look forward to your continued support,
patronage and inputs in taking our Bank to new heights during FY26 and beyond.
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Yours sincerely, |
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VIJAY SRIRANGAN |
|
CHAIRMAN |
Date: 30.05.2025 |
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