Beating the analysts’ expectations, public sector lender Punjab National Bank (PNB) on Thursday reported  nearly three-fold rise in its net profit to Rs 3,010 crore in Q4, driven by fall in provisions for bad loans and higher interest income. The bank had posted a net profit of Rs 1,159 crore in the year-ago period. Analysts polled by Bloomberg had estimated the bank to post Rs 2,277 crore net profit.

“There has been all round improvement including NII and reduction in NPAs (non performing assets), which has contributed to highest ever fourth quarter net profit,” said Atul Kumar Goel, managing director and chief executive officer, PNB in a post-result press conference. “Credit growth is expected to be 11-12% while deposit growth would be 9-10% in the current financial year,” he added.

The provisions for bad loans declined to Rs 1,958 crore during the fourth quarter, as against Rs 3,625 crore during the same quarter a year ago due to improvement in asset quality. Bank’s gross non-performing assets ratio improved to 5.73 % as of March end from 6.24 % a quarter ago, and 8.74 % last year. Its net NPA stood at 0.73 % as on March 31, 2024, as against 0.96% in the previous quarter and 2.72% in the year-ago period.

Net interest income, the difference between interest earned and paid, rose 9% to Rs 10,363 crore in the March quarter of FY24 while other income rose 24.1% year-on-year to Rs 4,247.6 crore.

The domestic net interest margin stood at 3.25% in the fourth quarter and bank expects it to be in 2.9-3% range in the current fiscal.

Bank’s savings deposits rose to Rs 4.80 trillion registering a on-year growth of 3.5 %.

Current Account Savings Account (CASA) deposits increased to Rs 5.53 trillion recording a growth of 2.7 %. Total retail credit increased 12.6 % to Rs 2.23 trillion as of March end.

The board has given its nod for raising Rs 7,500 crore via Qualified Institutions Placement (QIP). The work has started and merchant bankers have been appointed for the QIP, Goel said. QIP should take place by September depending on the market conditions. During the latest January-March quarter, the bank made a cash recovery of Rs 1,800 crore as against Rs 2,575 crore in the same quarter a year ago.