ICRA has assigned and reaffirmed credit ratings for Canara Bank’s Basel III Tier I and Tier II bonds. The rating for ₹3,500 crore Basel III Tier I bonds is newly assigned at [ICRA]AA+(Stable). Ratings on existing bonds totaling ₹26,400 crore were reaffirmed, reflecting Canara Bank’s sovereign ownership, robust deposit franchise, healthy capitalization, and stable outlook. The announcements were made on October 30, 2025.
ICRA Ratings Action
Canara Bank announced that ICRA has assigned and reaffirmed its ratings on the bank’s Basel III Tier I and Tier II bonds. These ratings reflect ICRA’s assessment of Canara Bank’s creditworthiness and stability.
Details of Ratings
The ratings action includes:
- ₹7,500.00 crore Basel III Tier I Bonds: Reaffirmed at [ICRA]AA+(Stable)
- ₹3,500.00 crore Basel III Tier I Bonds: Assigned at [ICRA]AA+(Stable)
- ₹8,900.00 crore Basel III Tier II Bonds: Reaffirmed at [ICRA]AAA(Stable)
- ₹10,000.00 crore Certificates of Deposit: Reaffirmed at [ICRA]A1+
Rationale for the Ratings
ICRA’s ratings consider several factors, including Canara Bank’s sovereign ownership, strong franchise with a market share of 5.8% in net advances and 6.4% in total deposits as of March 31, 2025. The ratings are further supported by the bank’s robust deposit franchise and strong liquidity profile.
Financial Performance
The bank’s core equity capital (CET I) and Tier I capital stood at 12.29% and 14.58%, respectively, as of June 30, 2025, maintaining a buffer over the regulatory ratios. NNPA/core capital improved to 7.29% as on June 30, 2025.
Asset Quality
The gross NPA percentage decreased to 2.69% as of June 30, 2025, from 4.14% as of June 30, 2024. NNPAs declined to 0.63% as of June 30, 2025.
Outlook
The Stable outlook on the ratings reflects ICRA’s expectation that the bank will be able to maintain a steady credit profile, with stable asset quality as well as healthy profitability and capitalization.
Source: BSE
