State-owned Canara Bank has approved a plan to raise up to Rs 8,500 crore through debt instruments during FY27 to strengthen its capital base and support future business growth. The bank will raise up to Rs 4,500 crore through Basel III-compliant Additional Tier I (AT1) bonds and up to Rs 4,000 crore through Basel III-compliant Tier II bonds, as per an exchange filing. This fundraising, scheduled for FY27, is subject to market conditions and regulatory approvals.
The decision to raise capital was made at the bank’s board meeting on June 2. The aim is to enhance the lender’s capital adequacy position and provide flexibility to support credit expansion amidst increasing loan demand. Canara Bank’s shares closed 1.13% higher at Rs 129.40 on the National Stock Exchange (NSE) before the announcement.
Canara Bank recently underwent a leadership change as Brajesh Kumar Singh assumed the role of Managing Director and Chief Executive Officer. Singh’s tenure will last until April 30, 2029, or until further government orders. Prior to this role, he served as Executive Director at Indian Bank, overseeing corporate credit, retail banking, human resources, and strategic operations.
The capital raise announcement follows the bank’s March quarter earnings, which showed profitability pressure despite an improvement in asset quality. In the quarter ending March 2026, Canara Bank’s net profit declined by 9.9% year-on-year to Rs 4,505 crore, mainly due to lower other income. However, net interest income for the quarter increased by 4% year-on-year to Rs 9,809 crore.
