Canara Bank gains on board nod to Rs 7,500-crore fund-raising plan

Canara Bank’s board has approved a plan to raise Rs 7,500 crore in FY24.

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26 Aug, 2025 12:21

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Canara Bank shares were trading around 2 percent higher in the afternoon trade after its board of directors approved Rs 7,500-crore fund-raising plan for the current financial year.

Of the Rs 7,500 crore, Rs 3,500 crore will be raised through additional Tier I bonds and the remaining Rs 4,000 crore through Tier II bonds, the bank said in an exchange filing. The board met on June 28.

Additional Tier I (ATI) bonds are unsecured bonds with no pre-determined maturity rate and issued to raise long-term capital. These bonds typically carry a higher coupon but are considered risky instruments in the event of a bank collapse. Tier II bonds are perpetual in nature and used by banks for subordinate debt.

In FY23, the state-owned lender’s revenue grew 17 percent year-on-year to Rs 111,209 crore. Net profit grew 83 percent year-on-year to Rs 11,254 crore during the period. Canara Bank’s EBITDA margins increased 46 basis points to 26.07 percent. One basis point is one-hundredth of a percentage point.

Also read Canara Bank shares decline 2% despite 90% surge in Q4 net profit

Canara Bank has given a guidance of 10.5 percent credit growth in FY24, MD-CEO Satyanarayana Raju said in an earnings call. In FY23, the bank’s credit growth was 16 percent.

Its Net Non-Performing Asset (NPA) fell 92 basis points year-on-year to 1.73 percent in FY23. The net NPS number was below the bank’s target of 2 percent.

At 2.02 pm, the share was trading at Rs 301.65 on the National Stock Exchange, up 1.65 percent from the previous close. The stock has lost 11.53 percent this year.

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