PNB Housing Finance books Rs 351-cr loss in Q4 on increased write-offs

PNB Housing Finance posted a pre-tax loss of Rs 351.18 crore on a standalone basis in the March quarter on a multi-fold rise in provisions for impairment on financial instruments and write-offs.

The firm had posted a pre-tax profit of Rs 547.05 crore in the quarter ended March 2019 (Q4FY19), according to BSE filings. It booked a net loss of Rs 263.12 crore in Q4 against a net profit of Rs 371.12 crore in the same period previous year.

For the entire financial year, its net profit fell to Rs 682.31 crore, from Rs 1,081.38 crore in FY19.

Net interest income declined by 19.9 per cent to Rs 488.1 crore, from Rs 609.7 crore in Q4FY19, while it had net interest margin of 2.61 per cent against 3.18 per cent in Q4FY19, the company said in a statement.

The Covid-19 pandemic has led to volatility in the financial markets and slowed economic activities. Based on the current indicators of future economic conditions, the company has maintained an incremental expected credit loss (ECL) provision of Rs 471 crore for Covid-19. This is in addition to the normal ECL provision.

The firm kept aside Rs 754.83 crore for impairment on financial instruments and write-offs, against Rs 10.11 crore in Q4FY19. Its assets under management declined 2 per cent from Rs 84,722 crore as of March 31, 2019, to Rs 83,346 crore as of March 31, 2020. The loan assets shrank 9 per cent, from Rs 74,023 crore as of March 31, 2019, to Rs 67,571 crore as of March 31, 2020.

The firm’s asset quality profile came under pressure with a rise in bad loans. Gross non-performing assets rose to 2.75 per cent, from 0.48 per cent a year ago, while net NPAs rose to 1.75 per cent of the loan assets, from 0.38 per cent.

Capital adequacy was 17.98 per cent, of which Tier I capital was 15.18 per cent and Tier II capital was 2.80 per cent. The Board did not recommend a dividend for FY20.