{"url":"https://newsforagent.com/news/2026-10-17/canara-bank-insurance-commission-cap-impact","markdown_url":"https://newsforagent.com/news/2026-10-17/canara-bank-insurance-commission-cap-impact.md","title":"Canara Bank Sees Rs 150-200 Crore Hit From Insurance Commission Cap","headline":"Canara Bank Flags Rs 150-200 Crore Insurance Commission Cap Impact as CEO Brajesh Kumar Singh Cites Rs 24,000 Crore Profit","description":"Canara Bank expects a Rs 150-200 crore hit if the proposed insurance commission cap takes effect, with CEO Brajesh Kumar Singh saying higher product sales can offset the loss.","section":"Regulation & Approvals","published_at":"2026-10-17T07:21:34+00:00","modified_at":"2026-10-17T07:21:34+00:00","author":"News Desk","key_takeaways":["Canara Bank estimates a Rs 150-200 crore impact if the proposed insurance commission cap is implemented in its current form.","CEO Brajesh Kumar Singh said the loss is small against the bank's Rs 24,000 crore profit.","Canara Bank's non-interest income declined 18% during the quarter, while net profit rose 8% year-on-year to Rs 5,175 crore."],"companies":[{"name":"Canara Bank","is_primary":true,"profile_url":"https://akta.pro/company-profiles/0000ber/canara-bank","website":"https://www.canarabank.bank.in"}],"source":{"publisher":"New Indian Express","title":"Proposed insurance commission cap may cost Canara Bank Rs 150-200 crore: MD & CEO","url":"https://www.newindianexpress.com/business/2026/Oct/17/proposed-insurance-commission-cap-may-cost-canara-bank-rs-150-200-crore-md-ceo"},"other_sources":[],"tags":["Regulation & Approvals","Canara Bank"],"body_markdown":"[Canara Bank](https://akta.pro/company-profiles/0000ber/canara-bank) could take a Rs 150-200 crore hit if the proposed cap on insurance commissions is implemented in its current form, managing director and chief executive officer Brajesh Kumar Singh said. The [New Indian Express](https://www.newindianexpress.com/business/2026/Oct/17/proposed-insurance-commission-cap-may-cost-canara-bank-rs-150-200-crore-md-ceo) reported the estimate on October 17, 2026.\n\n## Singh's Estimate on the Insurance Commission Cap\n\nSingh said Canara Bank expects to offset part of the loss by increasing the volume of insurance products sold through its branches. \"Even if it is reduced, the loss to earnings will be very small. That is not our core business. In Rs 24,000 crore profit, Rs 200 crore is nothing. Not even 1%,\" he said in an interaction with The New Indian Express.\n\nThe proposed cap on insurance commissions remains at the draft stage, and the final impact will depend on the guidelines eventually notified by the insurance regulator. Canara Bank plans to continue offering insurance products alongside other financial services, focusing on customer convenience and higher distribution volumes to make up for any reduction in commissions.\n\nThe comments come as Canara Bank's non-interest income declined 18% during the quarter. Singh expects rising financial literacy and greater awareness of insurance products to support distribution volumes and help offset the impact of lower commissions.\n\nCanara Bank reported net profit growth of 8% year-on-year to Rs 5,175 crore, while net interest income rose 20.4% to Rs 11,005 crore. Singh said he expects the bank to maintain its net interest margin in the 2.5-2.6% range over the next couple of quarters, with scope for a marginal improvement of one to two basis points.\n\n## Canara Bank's Capital and Deposit Moves\n\nCanara Bank's board approved capital raising of up to ₹8,500 crore through Basel III compliant bonds for FY26-27, comprising ₹4,500 crore Additional Tier I and ₹4,000 crore Tier II instruments, according to akta.pro [company records](https://akta.pro/company-data). The bank launched a special FCNR(B) deposit scheme for Non-Resident Indians offering up to 6.5% interest on US dollar deposits, effective June 11, 2026.\n\nCanara Bank mobilised around Rs 55,000 crore through foreign currency non-resident (FCNR(B)) deposits during the quarter. Singh said the bank's current account and savings account ratio stood at around 29%, below its guided range of 30-32%, attributing the shortfall largely to the composition of deposits rather than a decline in the absolute amount of CASA deposits.\n\n## Earlier Canara Bank Developments\n\nThe Times of India reported on October 14, 2026, that Canara Bank expected proposed IRDAI distribution norms to reduce its distribution income by up to Rs 200 crore annually, with life insurance distribution facing a Rs 120-145 crore hit. On October 15, 2026, CNBC TV18 reported that Singh said the bank expects to maintain a return on assets above 1% and manage a ₹3,000 crore expected credit loss impact through internal accruals without fresh capital.\n\nBusiness News Today reported on October 15, 2026, that Singh said an RBI rate hike would only marginally boost margins and that the bank had no immediate plans to raise deposit rates, with net interest margin at 2.55% in Q2.\n\n## What Comes Next for Canara Bank\n\nCanara Bank expects credit demand to remain strong in the current quarter, driven by festive-season spending and consumption-led borrowing. The bank will step up deposit mobilisation to keep pace with credit growth, with advances having grown around 19-20% while deposit growth has been lower.\n","publisher":{"name":"News for Agent","url":"https://newsforagent.com"}}