Punjab National Bank shares surged over 3 per cent on Wednesday despite the bank reporting a net loss of Rs 5,367.14 crore for the fourth quarter ended March 31, 2016, on account of higher provisioning for bad loans.
The share price of the bank closed 3.25 per cent up at Rs 76.20.The scrip opened at Rs 72.55 and has touched a high and low of Rs 77.20 and Rs 72.10, respectively, in trade so far.
Provisions of the bank jumped nearly 3 times, or 173 per cent, to 10,485.23 crore for the quarter under review from Rs 3834.19 crore in the same quarter last year.
On Wednesday’s stock price movement, G Chokkalingam, founder, Equinomics Research & Advisory said, “Trading interest in PNB shares supported the price movement on Wednesday as it was hovering near to its 52-week low level of Rs 69.40. Also, possible short covering in F&O segment further lifted the scrip.”
Parag Jariwala, VP–institutional research, banking and financial services, Religare Capital Markets in a research note said, “Stressed assets (NNPA + restructured assets) actually declined from 14.8 per cent in 3Q16 to 13.5 per cent in 4Q16. Though, we were expecting large portion of restructured assets to go into NPA, flat stressed assets on QoQ basis is positive as it suggests no fresh addition to stressed book.”
Net non-performing assets (NPA) or bad loans as a percentage of net advances stood at 8.61 per cent during the last quarter of 2015-16. Net NPAs of the bank were at 4.06 per cent in the same period last year.
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 last year.