New Delhi: State-owned Canara Bank has approved a proposal to raise up to Rs 8,500 crore through bonds in FY27. The move is aimed at strengthening the bank’s capital position and supporting future business growth as demand for loans continues to increase.
Board Approves Capital Raising Plan
In a stock exchange filing, the bank said its board has cleared plans to raise funds through Basel III-compliant debt instruments during the current financial year.
The lender plans to raise up to Rs 4,500 crore through Additional Tier-I (AT1) bonds and up to Rs 4,000 crore through Tier-II bonds.
The fundraising will be carried out in phases depending on market conditions and after obtaining necessary regulatory approvals.
Focus on Growth and Capital Strength
The proposed bond issuance is expected to improve the bank’s capital adequacy ratio and provide additional financial flexibility.
A stronger capital base will help Canara Bank support higher credit growth across retail, corporate and other lending segments. The move comes at a time when banks are witnessing steady demand for loans from businesses and individuals.
Market participants generally view such capital-raising exercises as important for maintaining healthy balance sheets and meeting future growth requirements.
Leadership Transition at the Bank
The fundraising announcement comes shortly after a key change in the bank’s leadership.
Canara Bank recently announced that Brajesh Kumar Singh has taken charge as Managing Director and Chief Executive Officer. His appointment follows a government notification issued on May 30.
Singh’s tenure will continue until April 30, 2029, or until further government orders.
Before joining Canara Bank, he served as Executive Director at Indian Bank, where he handled corporate credit, retail banking, human resources and strategic operations.
Asset Quality Improves Despite Profit Pressure
The bank’s latest quarterly results showed a mixed performance.
For the quarter ended March 2026, Canara Bank reported a net profit of Rs 4,505 crore, down 9.9 percent from a year earlier due to lower other income.
However, net interest income increased 4 percent year-on-year to Rs 9,809 crore, reflecting healthy core banking operations.
The lender also reported better asset quality. Gross NPAs improved to 1.84 percent from 2.08 percent in the previous quarter, while net NPAs eased to 0.43 percent from 0.45 percent.
Shares of Canara Bank ended 1.13 percent higher at Rs 129.40 on the NSE ahead of the announcement.
