Punjab National Bank on Wednesday reported a 51.7 % year-on-year jump in its net profit to Rs 4,567 crore for the fourth quarter of the previous financial year, helped by a sharp fall in provisions for bad loans and an increase in other income.
The bottom line beat expectations as analysts polled by Bloomberg had estimated the bank to post a Rs 4,164-crore net profit in the quarter.
Addressing the post-earnings press conference, managing director and CEO Ashok Chandra said the committee of creditors (CoC) of Bhushan Power and Steel is expected to meet in two-three days to discuss the course of action following the Supreme Court’s ruling on JSW Steel’s resolution plan.
“The decision of the Supreme Court has come. There is a CoC having 32 lenders. We are going to have a discussion next week where all the lenders will take part. We will also be talking to the counsellor, who had given the advice to CoC members. We will be onboarding those people, and then we will have a discussion about what is the way forward in that particular account…” Chandra said.
The lender had received around Rs 3,000 crore from BPSL resolution.
“We expect a credit growth of 11-12% and deposit growth of 9-10% in the current financial year,” said Chandra. He expects the net interest margin to remain in 2.8-2.9% range.
Net interest income, the difference between interest earned and paid, rose 3.8% to Rs 10,757 crore in the quarter under review, from Rs 10,363 crore in the year-ago period.
The net interest margin contracted to 2.96% in the latest quarter, from 3.09 in the third quarter of FY25 and 3.25% in the March quarter of FY2024. Provisions for bad loans declined 70% to Rs 588 crore. Other income rose 11% to Rs 4,716 crore, from Rs 4,248 crore in the same quarter last year.
The lender improved its asset quality as the gross non-performing assets ratio improved by 178 bps year-on-year to 3.95%. In absolute terms, the gross NPA fell to Rs 44,082 crore from Rs 45,414 crore. The net NPA ratio improved by 33 bps to 0.40%. In absolute terms, the net NPA declined to Rs 4,291 crore from Rs 4,437 crore.
The board approved a proposal to raise capital of up to Rs 8,000 crore this fiscal through the issuance of Basel III-compliant bonds in one or more tranches. It has recommended a dividend of ₹2.90 per share for FY25.