Canara Bank has announced a reduction in its marginal cost of funds-based lending rates (MCLR) for select tenors, effective February 12, 2026. The bank lowered its overnight and one-month MCLR by 5 basis points. The revised overnight rate now stands at 7.85%, while the one-month rate has been adjusted to 7.90%. These changes aim to lower borrowing costs for retail and wholesale customers, supporting the Reserve Bank of India’s objective for transparent interest rate transmission. For longer tenures, the rates remain stable. The three-month MCLR is maintained at 8.15%, the six-month at 8.50%, and the one-year rate—to which many home and auto loans are linked—stays at 8.70%. The two-year and three-year rates are positioned at 8.85% and 8.90% respectively. This move comes as the Reserve Bank of India maintained the repo rate at 5.25% during its February 2026 meeting. The central bank has held a neutral stance, balancing a cumulative 125-basis-point reduction since early 2025 with a projected GDP growth of 7.4% for the current fiscal year. Canara Bank’s operational performance remains strong, reporting a 26% year-on-year growth in net profit to 5,155 crore for the December quarter. This growth was driven by improved asset quality, with the Gross NPA ratio falling to 2.08% from 3.34% a year ago. Global advances for the bank reached 11.92 lakh crore, marking a 13.59% increase. Retail lending, a key driver of credit demand, surged over 31% to 2.73 lakh crore, highlighting the bank's focus on the RAM (Retail, Agriculture, and MSME) sector. The broader banking sector shows resilience, with the Bank Nifty index opening at 60,805.20 in early February trade. Public sector banks collectively recorded a record profit of 52,603 crore in the third quarter, signaling high liquidity and healthy balance sheets across the industry. While the RBI keeps the headline repo rate steady, individual bank adjustments like those from Canara Bank reflect local liquidity conditions and competitive credit demand. Existing borrowers will see the impact of these cuts during their next scheduled loan reset dates.