TOGETHER WE CAN

November 2010 o e be 0 0

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DISCLAIMER
This presentation has been prepared by Canara Bank (Bank) solely for your information and for your use and may not be taken away, distributed, reproduced, or redistributed or passed on, directly or indirectly, to any other person (whether within or outside your organization or firm) or published in whole or in part, for any purpose by recipients directly or indirectly to any other person. By accessing this presentation, you are agreeing to be bound by the trailing restrictions and to maintain absolute confidentiality regarding the information disclosed in these materials. This presentation does not constitute or form part of any offer or invitation or inducement to sell or issue, or any solicitation of any offer or p p y , y y recommendation to purchase or subscribe for, any securities of the Bank, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment therefor. This presentation contains statements that constitute forward-looking statements. These statements include descriptions regarding the intent, belief or current expectations of the Bank or its directors and officers with respect to the results of operations and financial condition of the Bank. These statements can be recognized by the use of words such as expects, plans, will, estimates, projects, or other words of similar meaning. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those in such forward-looking statements as a result of various f t f d l ki t t t lt f i factors and assumptions which the Bank believes to be reasonable in light of its operating experience in d ti hi h th B k b li t b bl i li ht f it ti i i recent years. The Bank does not undertake to revise any forward-looking statement that may be made from time to time by or on behalf of the Bank. No representation, warranty, guarantee or undertaking, express or implied, is or will be made as to, and no reliance should be placed on, the accuracy, completeness or fairness of the information, estimates, projections and opinions contained in this presentation. Potential investors must make their own assessment of the relevance, accuracy and adequacy of the information contained in this presentation and must make such independent investigation as they may consider necessary or appropriate for such purpose. Any opinions expressed in this presentation are subject to change without notice. None of the Bank, the placement agents or any other persons that may participate in the offering of any securities of the Bank shall have any responsibility or liability whatsoever for any loss howsoever arising from this presentation or its contents or otherwise arising in connection therewith. This presentation is not intended to be a prospectus or preliminarily placement document or final placement document under the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended. This presentation does not constitute an offer or invitation to purchase or subscribe for any securities in any jurisdiction, including the United States. No part of it should form the basis of or be relied upon in connection with any investment decision or any contract or commitment to purchase or subscribe for any securities. None of our securities may be offered or sold in the United States, without registration under the U.S. Securities Act of 1933, as amended, or pursuant to an exemption from registration there from. This presentation is confidential and may not be copied or disseminated, in whole or in part, and in any manner.

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CANARA BANK AT A GLANCE

3rd largest public sector bank in terms of domestic business Among the top 5 public sector banks in terms of assets Consistent track record of profitability since establishment 105 years ago Leading lender to the infrastr ct re sector benefitting from infrastructure Indias economic growth Pan-India network of over 3,000 branches and over 2,000 ATMs serving over 37 million clients g Technology focused bank with 100% coverage of branches under Core Banking System Subsidiaries, joint ventures and associates in non-traditional ,j banking, including insurance and asset management One of the highest Government shareholding amongst public sector banks at 73.2%1
Source: Company filings Note: US$1:INR45; 1 As of September 2010

6 months ending Sep 2010 Net interest Net-interest income Net profit Total assets Net advances Total deposits Total equity Market Cap (Nov 17, 2010) a et ( o , 0 0) Key ratios Net-Interest margin Cost/Income ratio Net NPA ratio Tier I ratio Return on avg assets avg. Return on equity

INR bn US$mm 37.3 37 3 20.2 2,828 1,761 2,492 167 3 9 319 829 449 62,836 39,127 55,375 3,707 7,098 ,098

3.16% 41.6% 41 6% 1.06% 8.82% 1.52% 1 52% 29.8%

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BUSINESS PROFILE

Corporate Banking
Full service offering to large and mid sized corporations i d i across India including project and corporate finance, working capital, short term short-term credit, cash management and treasury products Infrastructure loans1 witnessed 63.4% y-oy growth to reach INR395bn as of Sep 2010

SME Banking
Comprises mainly of priority sector lending to small-scale ll l industries Over 445,950 customers serviced through 42 specialized branches and 15 centralized processing centers Priority sector loans y were INR259bn and non-priority sector loans were INR69bn as of Sep 2010

Retail Banking
Includes housing, vehicle, personal and education l d i loans, selflf employed and corporate employee loans, deposits, credit and debit cards, and services to non-resident Indians Housing loans witnessed y-o-y growth at 41.8% and constitute 44.8% of retail loan book

Other B i Oth Businesses

Agricultural lending and consultancy services, i international banking, bancassurance, sale of mutual fund products, depositary participant services, merchant banking and executor, trustee and taxation related services

30% of which are short term in nature

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KEY SUBSIDIARIES AND ASSOCIATES

Insurance
Joint venture with HSBC Insurance and Oriental Bank of Commerce Among the top ten of 22 private life insurers in FY10 in terms of new business premiums Fastest to receive INR10bn (in 23 months) of weighted new business premiums

Asset Management
Joint venture with the Netherlands based Robeco Groep N.V., a subsidiary of Rabobank, which holds 49% stake AuM of INR77.2bn as of Sep 2010 Reached break even with net profit of INR62.3mm for FY10

Factoring
One of the leading factoring companies in India in terms of total turnover Business turnover at INR37.4bn for FY10 and INR18.6bn for 6 months ended Sep p 2010 Also provides other services, such as invoice discounting and export factoring

Can Fin Homes

Engaged in housing finance, listed on BSE with market capitalization of INR2.8bn1 Canara Bank holds 42.4% stake Services more than 175,000 families2 Cumulatively sanctioned housing finance of INR62bn with di b ith disbursements t 2 above INR53bn

Other subsidiaries, associates and joint ventures include Canara Bank Securities, Canbank Financial Services, Canbank Venture Capital, Commercial Bank of India LLC, CARE India Ltd., Commonwealth Trust (India) Ltd. and Canbank Computer Services S i
Source: Company filings; Note: FY indicates fiscal year ended March 31st; BSE indicates Bombay Stock Exchange; 1 As of November 17, 2010 2 As of year ended March 31, 2010

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CANARA BANK: KEY STRENGTHS

1 2 3 4 5 6 7 8 9 10
www.canarabank.com Reputation as a customer centric bank

Delivering balance sheet growth without compromising margins

Thrust on asset quality

Pan India Pan-India presence with focus on developed regions of India Emphasis on cost control and productivity

Benefitting from significant investment in technology

Diversified sources of income through increased initiatives

Insulated investment profile with consistent yields

Sound capital position and high government ownership Profitable since inception with meaningful returns to stakeholders

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CUSTOMER CENTRIC BANK

Specialized touch points for each customer category Emphasis on customer service Customers (mm)
132 specialized service branches 10 prime corporate branches, 3 stock exchange branches, branches 7 asset recovery management branches

50.0 40.0 30.0 20.0 10.0 0.0 FY08

Key initiatives y
33 extension counters to service retail depositors at places such as factories or universities

32.4

34.8

37.3

37.5

17 overseas branches, branches 10 agri-finance branches

Customer touch points

3 capital markets branches, 3 Mahila banking branches

FY09

FY10

H1FY11

Best in class counter service Superior customer relationship management Marketing through well trained front office staff and a strong feet on street sales force feet street Continuous efforts to build brand awareness

1 consumer finance branch and 1 housing finance branch

Source: Company S C

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DELIVERING BALANCE SHEET GROWTH

Steady growth in advances
Advances (INRbn)

High proportion of deposits in funding mix

Deposits (INR bn) 3,000 2,500 2 500 2,000 1,541 1,500 1,000 500 0 FY08

3,000 2,500 2,000 1,500 1,000 500 0

2,347 2 347 1,869

2,492

1,072

1,382

1,693

1,761

FY08

FY09

FY10

H1FY11

FY09

FY10

H1FY11

Source: Company filings; Note: FY indicates fiscal year ended March 31st

Source: Company filings; Note: FY indicates fiscal year ended March 31st

Corporate lending remains key

Agriculture Others 1% 11% Retail 13% SME 15% Corporate 60% Total = INR1,761bn
Source: Company filings

Increasing emphasis on CASA deposits

Savings 22% Current 7% Fixed 71%

Total = INR2,492bn
Source: Company filings Note: Current and savings accounts (CASA) account for 30% of domestic deposits

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WITHOUT COMPROMISING MARGINS

Strong growth in net interest income
INR bn

and increasing NIMs (%)

60.0 60 0 50.0 40.0 30.0 35.4 35 4 47.2

56.8 56 8

3.5% 3 5% 3.0% 37.3 2.5% 2.0% 1.5% 2.42% 2.78% 2.80%

3.16%

20.0 10.0 0.0 FY08 FY09 FY10 H1FY11

1.0% 0.5% 0.0% FY08 FY09 FY10 H1FY11

Source: Company filings; Note: FY indicates fiscal year ended March 31st

Source: Company filings; Note: FY indicates fiscal year ended March 31st

Savings campaigns to emphasize retail business Increased emphasis on low-cost CASA deposits Base rate regime protects margins

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THRUST ON ASSET QUALITY

Non-performing assets remain manageable
40.0 Gross NPLs Net NPLs

with decreasing ratios

2.0% Gross NPL Ratio 1.56% Net NPL Ratio

(INR bn)

1.6%
30.0 25.9 21.7 20.0 15.1 12.7 9.0 10.0 18.0 18.6 26.4

1.52%

1.49%

1.2%

1.18% 0.84%

1.09%

1.06%

1.06%

0.8%

0.4% 0 4%

0.0 FY08 FY09 FY10 H1FY11

Source: Company filings; Note: FY indicates fiscal year ended March 31st

0.0% FY08 FY09 FY10 H1FY11

Source: Company filings; Note: FY indicates fiscal year ended March 31st

One of the highest provision coverage ratios amongst public sector banks at 77.1% as of Sep 2010 Minimal exposure to commercial real estate, microfinance and capital markets p , p Focus on recoveries through asset recovery branches, Can Adalats and Lok Adalats Robust credit approval and risk management policies www.canarabank.com
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PAN INDIA PRESENCE

Significant growth in branches1 and ATMs
Branches(Nos) 3,500 3,047 3,000 2,500 2 500 2,006 2,000 1,500 1,000 500 0 FY08 FY09 FY10 H1FY11
Lakshadweep

Well spread network of branches

Jammu & Kashmir (11) Himachal Pradesh (19) Uttarkhand (30)

ATMs(Nos)

States with 100 or more branches States with 50 99 branches 50-99 States with <50 branches Figures in ( ) indicate # of branches
Arunachal Pradesh Sikkim (2)

3,066

Chandigarh (14) Punjab (119) Delhi (124)

2,679

2,733

Haryana (90)

Rajasthan (44)

Uttar Pradesh (232)

Bihar (100)

Assam (21) A Meghalaya (3)

Nagaland

2,019

2,017

2,017

Manipur Jharkhand West Tripura (2) (55) Madhya Pradesh Mizoram Bengal Gujarat (66) (51) (93) Chattisgarh (11) Orissa ( ) (53) Maharashtra M h ht Dadra & (232) Nagar Haveli (2) Andhra Pradesh (213) Goa (25) Karnataka (619) Pondicherry (5) Kerala (281) Tamilnadu (544)

Andaman and Nicobar Islands (1)

Source: Company filings; Note: FY indicates fiscal year ended March 31st 1 Includes overseas branches

Thrust on organic g g growth Focus on alternate channels such as internet banking Plans to expand ATM network Launch of mobile banking shortly www.canarabank.com
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COST CONTROL AND PRODUCTIVITY

One of the most efficient
Cost to income ratio (%) INR mm

and productive public sector banks

Business per branch 120 106 100 98 78 61 60 40 0.6 0.4 0.2 0.0 FY08 FY09 FY10 H1FY11 1.0 0.8 Profit per employee INR mm 1.2

50.0%

48.5%

45.0%

43.6% 40.7% 41.6%

80

40.0%

35.0%
20

30.0% FY08 FY09 FY10 H1FY11

Source: Company filings; Note: FY indicates financial year ending March 31st

Source: Company filings; Note: FY indicates financial year ending March 31st; Business defined as sum of advances and deposits

Emphasis on hiring training and retaining top talent hiring, Centralized processing of back office functions Cost effective resource mobilization program Control on operating expenses www.canarabank.com
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BENEFITTING FROM INVESTMENT IN TECHNOLOGY

100 % Core Banking System integrated with solutions such as: Internet banking Customer relationship management Securities trading Real Time Gross Settlement System and National Electronic Funds Transfer enabled at all branches Data centre in Bangalore and a disaster recovery centre in Mumbai Taken steps to initiate a data warehouse for credit risk management Aiming to have the best technology among public sector banks

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DIVERSIFIED SOURCES OF INCOME

Delivering strong growth in non-interest income
Fees
INR bn 40

Non-interest incomebreakdown (% as of H1FY11)

Other 12.5% Dividend income 6.1%

Other income

Fees 56.5%

35 30 25 20 15 10 5 0 FY08 FY09 FY10 H1FY11 11.7 12.2 14.0 7.0 10.4

22.1 23.1 28.6

14.6 10.9
12.3

Profit from foreign exchange g g transactions 11.8%

5.3

Profit from sale of investments 13.0% 13 0%

Total = INR12.3bn
Source: Company filings

Source: Company filings; Note: FY indicates fiscal year ended March 31st

Cross selling of insurance, on-line trading services and mutual fund products through 2,596 branches Increasing traditional fee based services Transactional Banking, Letter of Credit, Guarantees, funds transfer etc Increasing thrust on foreign exchange transaction related activities

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INSULATED INVESTMENT PORTFOLIO

Majority of investments in Government securities Stable yield profile

6 months ended Sep 2010 Government securities Shares Debentures and bonds Subsidiaries and/or joint ventures Others Total
Portfolio is not speculative in nature p

INR bn 650 11 21 5 84

% of total 84.3% 1.4% 2.8% 0.7% 0 7% 10.9%

9.0% 8.0% 7.0% 6.0% 6 0% 5.0% 4.0% 7.89% 7.94% 7.52% 7.61%

772 100.0%

6 months ended Sep 2010 Held to maturity Available for l A il bl f sale Held for trading Total
Source: Company filings

INR bn 614 154 4 772

% of total 79.6% 20.0% 20 0% 0.4% 100%

3.0% 2.0% 1.0% 1 0% 0.0% FY08 FY09 FY10 H1FY11

Source: Company filings; Note: FY indicates fiscal year ended March 31st

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SOUND CAPITAL POSITION

Healthy Tier 1 ratio
10.0% 8.0% 6.0% 4.0% 2.0% 0.0% FY08 FY09 FY10 H1FY11 7.0% 8.8%

Large government stake provides flexibility

Mutual Funds & others Insurance 9% Companies 7% Foreign Institution Investors 11%

8.0% 8 0%

8.5%

Source: Company filings; Note: Financial year ending March 31st

Stab e C Stable CAR

Government of India 73%

15.0% 14.0% 13.0% 13 0% 12.0% 11.0% 10.0% FY08 13.3%

14.1% 13.4%

13.9%

Not raised equity since IPO in November 2002 Low foreign institutional holding provides capital flexibility

FY09

FY10

H1FY11

Source: Company filings; Note: Financial year ending March 31st

Proposed Basel III norms require banks to enhance core capital

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DELIVERED MEANINGFUL RETURNS TO SHAREHOLDERS

Book value per share (INR)
400 300 200 100 0 355

Earnings per share (INR)

80 60 40 20 0 74 38 51 49

202

245

306

FY08

FY09

FY10

H1FY11

FY08

FY09

FY10

H1FY11

Dividends per share (INR)

Return on equity (%)

40.0% 30.0% 20.0% 10.0% 0.0% 19.1% 22.6% 26.8% 29.8% 29 8%

12.0 10.0 8.0 6.0 4.0 2.0 0.0

10.0 8.0 8.0

FY08
Profitable since inception

FY09

FY10

FY08

FY09

FY10

H1FY11

Delivered net profit of over Rs10bn per quarter for the last 2 quarters for the first time in the history of the Bank
Source: Company filings; Note: Financial year ending March 31st; 1 Not annualized

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BUSINESS STRATEGY

Focus on leveraging technology for improved customer service and business growth b i th Reposition the Bank's brand to attract young generation through effective use of e- channels and branch transformation models Focus on growth through expansion of domestic delivery channels Increase international footprint and thereby enhance the share of overseas business in total business of the bank Greater thrust on improving fee based income through cross selling of financial products & services and through ancillary business Leverage the Banks Subsidiaries to emerge as a Financial Super market

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INDIA: HIGH GROWTH ECONOMY

One of the fastest growing economies
Real GDP growth (%)
12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 10.0% 8.5% 7.3% 6.2% 5.2%
3,000 2,500 2,000 1,520 1,750 2,020 2,320 2 320 2,620

GDP per capita to double to US$ 2,620 by 2015

4.3%

3.9%

3.2%

1,500 1,000 500 0

1,110

1,340

China

India

Brazil Malaysia Korea Thailand Russia South Africa

2009

2010

2011F

2012F

2013F

2014F

2015F

Source: Moodys country credit statistics, 2010 Note: Data for India for year ending Mar 2011

Source: EIU; Note: Denotes year ended March

Steady increase in foreign reserves c ease o e g ese es

US$ bn
350 300 250 200 150 100 50 0 Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 136 145 192 299 241 259

High savings rate as a % of GDP

40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 34.0% 36.1% 35.6% 34.3%

29.5%

30.8%

Mar-05

Mar-06

Mar-07

Mar-08

Mar-09

Mar-10

Source: Moodys country credit statistics

Source: Moodys country credit statistics, 2010

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INDIA: GROWTH UNDERPINNED BY STRONG FUNDAMENTALS

Increasing inflation rate (%)
14.0% 12.0% 10.0% 10 0% 8.0% 6.0% 4.0% 2.0% 0.0% 12.6% 9.2% 7.0% 3.6% 4.2% 6.6%

Increasing consuming/producing age group

years Population mn

65+ 15 - 64 Under 15

45 65 604

2000 2015 819 361 372

Mar-05 M 0

Mar-06 M 06

Mar-07 M 0

Mar-08 M 08

Mar-09 M 09

Mar-10 M 10

200

400

600

800

1000

Source: Moodys country credit statistics

Source: Vision 2020, Planning Commission

Robust private consumption growth p p g

CAGR FY10 FY15 11%

Increasing number of billion dollar companies g p

No. of companies in terms of market capitalisation

Personal disposable income per head (US$) Private consumption per head (US$) 1,320 897 1,480 997 1,650 1,110

> US$ 10 bn US$ 2 bn - US$ 5 bn

106 121 174

US$ 5 bn - US$ 10 bn US$ 1 bn - US$ 2 bn

92 191 202

2,000 1,500 1 500 1,000 500 0 2009 2010 2011F 2012F 2013F 928 637 1,190 1 190 1,080 808 746

250 200 150 100 50 0

70

2014F

Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Sep-10

Source: Factset Number of companies with market capitalisation of US$ 1 bn or more

Source: EIU; Note: Denotes year ended March

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INDIA BANKING SECTOR REMAINS UNDERPENETRATED

Indian banking sector is growing exponentially
INRbn
50,000 50 000
Advances Deposits 44,9 928 40,632

With room for further growth

Domestic credit to GDP (%)
170 0%

148%

33,201

160%
3 32,448

30, ,009

40,000
26,97 70 24,769

15 5,168

19,812

100% 80% 60% 40% 20%

South Africa Thailand China

87% 5 59% India Malayasia Russia

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30,000

20,000

21,647

120%

111%

140%

138%

Advances CAGR21% Ad CAGR 21% Deposits CAGR20%

180%

166%

10,000

Mar-06

Mar-07

Mar-08

Mar-09

Mar-10

Source: RBIReport on trends and progress in banking sector

Source: Moodys country credit statistics, 2010 Note: Data for India as of Mar 2010

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Korea

Brazil

0%

34%

SUMMARY FINANCIALS
Profit & Loss (INR mm)

H1FY11 Net Interest Income Other Income Operating Exp Pre provisioning profits Provisioning and tax Net Profit 37,311 12,336 12 336 20,656 28,991 8,778 20,213

H1FY10 26,052 13,665 13 665 17,212 22,505 7,846 14,659

FY10 56,805 28,579 28 579 34,776 50,608 20,394 30,214

FY09 47,178 23,112 23 112 30,652 39,638 18,914 20,724

FY08 35,378 22,129 22 129 27,913 29,594 13,944 15,650

Source: Company filings; Note: FY indicates financial year ending March

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SUMMARY FINANCIALS
Balance Sheet (INR mm)

H1FY11 Capital And Liabilities p Capital Reserves and surplus Deposits Borrowings B i Other liabilities and provisions Total Assets Cash & balances with RBI Balances with banks, money at call etc. Investments Advances Fixed assets Other assets Total
Source: Company filings; Note: FY indicates financial year ending March

H1FY10 4,100 132,360 87,334 87 334 72,123

FY10 4,100 142,618 84,406 84 406 69,773

FY09 4,100 117,978 140,009 140 009 65,446

FY08 4,100 100,905 25,172 25 172 134,386

4,100 162,706 109,485 109 485 59,466

2,491,865 2,051,625 2,346,514 1,868,925 1,540,724

2,827,622 2,347,542 2,647,411 2,196,458 1,805,287

177,866 53,369 771,835 771 835 28,278 35,564

137,746 34,066 650,039 650 039 28,709 32,426

157,195 39,338 696,770 696 770 28,594 32,168

100,368 66,230 577,769 577 769 29,295 40,602

133,648 44,726 498,116 498 116 29,169 27,248

1,760,711 1,464,556 1,693,346 1,382,194 1,072,380

2,827,622 2,347,542 2,647,411 2,196,458 1,805,287

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CANARA BANK: KEY RATIOS AT A GLANCE

Financial highlights

H1FY11 Net profit growth Net-interest income growth Net advances growth Total deposits growth Provisioning coverage ratio Cost/Income ratio Gross NPA ratio Net NPA ratio Tier I ratio Net advances / total deposits Net-Interest margin Return on avg. assets Return on equity CAR CASA ratio
Source: Company filings; Note: FY indicates fiscal year ended March 31st Note: Domestic CASA ratio at 30 1% as of Sep 10 30.1% Sep-10

FY10 45.8% 20.4% 22.5% 25.6% 77.7% 77 7% 40.7% 1.52% 1.06% 8.54% 72.2% 2.80% 1.30% 26.80% 13.43% 29.9%

37.9% 43.2% 20.2% 21.5% 77.1% 77 1% 41.6% 1.49% 1.06% 8.82% 70.7% 3.16% 1.52% 29.8% 13.88% 28.9%

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