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: Key factors supporting the ratings of several Indian banks include strong liquidity, limited vulnerability to external capital flows, and the high likelihood of systemic support in the event of difficulty. PSU banks, such as Canara Bank, additionally benefit from the high likelihood of support arising from their ownership by the Government of India. GoI's support to public sector banks has also been adequately demonstrated by repeated instances of large re-capitalisation of these banks, amounting to about Rs 22,500 crore in the last 13 years.
Outlook
It is expected that the GoI will continue to support all public sector banks. Canara Bank will maintain its strong market position and that the Bank's financial and business risk profile would be maintained at levels that will sustain the current rating.
Market position
Canara Bank's strong market position is underpinned by its pan-Indian presence and its large and diversified balance sheet. Canara Bank is the fourth-largest bank in India in terms of asset size, with an asset book of Rs 110,300 crore as on March 31, 2005' and in terms of deposit size, it is the third-largest bank at Rs 96,900 crore. Canara Bank's market share was in excess of 5% of the total assets, deposits and advances of all scheduled commercial banks as on March 31, 2005. Canara Bank is also one of the few national players in the banking sector to have a network of over 2500 branches spread across the country.
| Sensitivity Factors | |||||||
| • Ownership and support from GoI • Maintenance...
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