CARE Ratings has reaffirmed its AAA rating with a stable outlook on Canara Bank’s infrastructure bonds and Tier II bonds, indicating a high degree of creditworthiness. Additionally, a new CARE AA+ rating has been assigned to Tier I bonds. These ratings are underpinned by Canara Bank’s strong retail franchise, capital adequacy, and government support. However, the rating agency has withdrawn the rating on some Tier II bonds due to redemption.
Credit Ratings Update
Canara Bank has received updated credit ratings from CARE Ratings for various debt instruments. The ratings reflect the creditworthiness and stability of the bank.
Key Rating Actions
- Infrastructure Bonds: The AAA rating with a stable outlook has been reaffirmed for infrastructure bonds amounting to ₹10,000 crore.
- Tier II Bonds: The AAA rating with a stable outlook has been reaffirmed for Tier II bonds.
- Tier I Bonds: A CARE AA+ rating with a stable outlook has been assigned to Tier I bonds amounting to ₹3,500.00 crore.
Rating Withdrawal
CARE Ratings has withdrawn its AAA rating on certain Tier II bonds due to their redemption.
Factors Supporting the Ratings
- Established retail franchise and a strong network, especially in southern India.
- Comfortable capital adequacy levels, supported by past capital infusions from the Government of India (GoI).
- Improvement in profitability over the last three years.
- Majority ownership by the GoI and its demonstrated track record of capital support.
Financial Performance Highlights
- Total business stood at ₹26.79 lakh crore as of September 30, 2025.
- The bank’s CASA stood at 28.02% as of September 30, 2025.
Asset Quality
- Gross NPA ratio of 2.35% and Net NPA ratio of 0.54% as of September 30, 2025.
Capital Adequacy
- Capital adequacy ratio (CAR) of 16.33% with Common Equity Tier (CET) I Ratio of 12.03% as on March 31, 2025.
Source: BSE
