PNB Housing Q1 PBT down 20.4% on sharp dip in NII, lower disbursement

Its net interest margin declined to 2.66% in Q1FY21 from 3.14% in Q1FY20 as it did not securitise part of portfolio in Q1FY21

PNB Housing Finance has posted 20.4 per cent drop in profit before tax (PBT) to Rs 329.48 crore in Q1FY21 on a sharp contraction in net interest income (NII).

Its PBT was Rs 414.03 crore in same quarter of last financial year ended June 2019 (Q1FY20). The lender's net profit declined by 10 per cent to Rs 257.2 crore from Rs 284.5 crore.

Its stock closed five per cent higher at Rs 210.25 per share on BSE.

Its NII for the reporting quarter stood at Rs 487.8 crore, down from Rs 625.5 crore in Q1FY20. The net interest margin (NIM) declined to 2.66 per cent in Q1FY21 from 3.14 per cent in Q1FY20 as the HFC did not securitise part of portfolio in Q1FY21. It had securitized assets worth Rs 2,318 crore during Q1 FY19-20.

The cumulative provision for Expected credit loss (ECL) stood at Rs 1,837.1 crore. The provision for impairment on financial instruments and write-offs declined sharply at Rs 75.09 crore in Q1FY21 from Rs 164.16 crore a year ago quarter. The total provision coverage ratio was at 98 per cent at the end of June 2020 as against 117 per cent in June 2019.

The gross non-performing assets (NPAs) rose to 2.76 per cent in June 2020 from 0.85 per cent a year ago.

PNB Housing's loan assets shrank by 10 per cent to Rs 68,009 crore at end of June 2020 from Rs 75,933 crore in June 2019. The disbursements were hit hard by lockdown and economic slowdown during quarter. HFC disbursed loans worth Rs 694 crore during Q1 FY20-21 compared to Rs 7,634 crore during Q1 FY19-20.

The disbursements, however, registered an increase on a month on month basis. Retail disbursements were at Rs 674 crore and Corporate disbursements at Rs 20 crore during Q1 FY20-21.

The Assets under Management (AUM) stood at Rs 83,495 crore in June 2020 as compared to Rs 88,333 crore in June 2019. The share of Retail Loans was 82 per cent and Corporate loans being 18 per cent of the AUM down from 20% as on 30th June 2019.

Referring to moratorium on loans, the company said approximately 39 per cent of AUM is under moratorium in phase two, down from 56 per cent in phase one. The retail Loans under moratorium account for 29 per cent of the Retail AUM in phase two which reduced from 49 per cent in Phase one, it said.

The total borrowings declined by seven per cent at Rs 67,283 crore at end of Q1FY21 from Rs 72,261 crore in June 2019. The leverage moderated to 8.24x in June 2020 compared to 9.19x in June 2019.

The Capital Adequacy Ratio (CAR) stood at 18.05  per cent as on at end of June 2020 (15.13 per cent in Q1FY20). The lender's Tier-I capital was 15.33 per cent in June 2020 (12.04 per cent in Q1FY20) and Tier II capital was 2.72 per cent (3.09 per cent in Q1FY20).