Punjab National Bank (PNB) reported a net loss of Rs 5,367.14 crore for the fourth quarter ended March 2016 against net profit of Rs 306 crore in the same quarter a year ago.
Provisions of the bank jumped nearly 3 times, 173 per cent, to 10,485.23 crore for the quarter under review from Rs 3834.19 crore in the same quarter last year.
The asset quality of Punjab National Bank deteriorated as gross non-performing assets rose to 12.90 per cent of gross advances during the quarter, from 6.55 per cent in the year-ago period.
In absolute terms, gross NPAs were Rs 55,818.33 crore in the quarter against Rs 25,694.86 crore last year.
Likewise, net NPAs or bad loans as a percentage of net advances stood at 8.61 per cent during the last quarter of 2015-16, from 4.06 per cent year ago. Net NPA of the company was at 5.86 per cent in the sequential quarter ended December 2015.
Net interest margins of Punjab National Bank slid 27 per cent to Rs 2767.71 crore in Jan-Mar 2016 period against Rs 3791.58 crore in the same period last year.
According to KRChoksey Institutional Research, Punjab National Bank Q4 results were a miss on all parameters and stood worst in the industry.
For the full fiscal, the lender reported a net loss of Rs 3,974.39 crore compared with a net profit of Rs 3,061.58 crore in corresponding last fiscal.
Siddharth Purohit, senior equity research analyst, banking, Angel Broking, said, “PNB has come out with numbers much lower than our and street’s expectations. This is by far the highest ever increase in NPA by any bank so far. The point of worry is that the bank believes cleaning up exercise of balance sheet is not over. We believe pain to continue in 2016-17 also, with regards to asset quality.”
At 12.47 am, shares of public sector bank erased their initial gains and were trading 0.07 per cent at Rs 73.85.
With this huge loss, Punjab National Bank is now among the several public sector banks that have reported losses due to bad loans. On Tuesday, Syndicate Bank reported a net loss of Rs 2,158.17 for the quarter ending March 2016 due to more than three-fold rise in provisions for bad loans and contingencies. Bank of Baroda, UCO Bank, Central Bank of India, Allahabad Bank and Dena Bank have earlier reported losses due to bad loans.