PNB Q4 net profit jumps fivefold to Rs 1,159 crore as interest income rises

Punjab National Bank’s (PNB’s) standalone net profit jumped 474 per cent year-on-year (YoY) to Rs 1,159 crore in the January-March quarter (Q4) as its net interest income (difference between interest earned and interest expended) went up by 30 per cent to Rs 9,499 crore and provisions for non-performing assets (NPAs) went down by 21 per cent to Rs 3,625 crore.

Sequentially, the net profit of the Delhi-based public lender jumped about 84 per cent from Rs 629 crore reported in the October-December period.

However, the bank reported a 27 per cent decline in net profit for FY23 to Rs 2,507 crore as against Rs 3,457 crore in FY22.

PNB Managing Director and Chief Executive Officer Atul Kumar Goel said the bank would raise Rs 12,000 crore through bonds in FY24 and has set a recovery target of Rs 22,000 crore from bad loans.

The bank has no exposure to airlines Go First and SpiceJet,” he added.

PNB’s income during the fourth quarter was Rs 27,269 crore as against Rs 21,095 crore a year ago, the lender said in an exchange filing. Its interest income during the quarter was Rs 23,849 crore as against Rs 18,645 crore reported last year.

The bank’s global net interest margin (NIM) was 3.24 per cent in the fourth quarter of FY23, up from the 2.76 per cent a year earlier.

The bank’s asset quality showed an improvement with gross NPAs as a percentage of gross advances dropping to 8.74 per cent from 11.78 per cent a year earlier.

Net NPAs stood at 2.72 per cent from 4.80 per cent a year ago and 3.30 per cent a quarter ago.

Goel said the bank aimed to bring gross non-performing assets (GNPAs) and net non-performing assets (NNPA) below 7 per cent and 2 per cent, respectively, by the end of FY24.

On a consolidated basis, including the financial results of five subsidiaries and 15 associates, the bank recorded a net profit of Rs 1,741 crore in January-March FY23 as against a profit of Rs 245 crore reported in the same quarter in FY22.

The lender said the board of directors had recommended a dividend of Rs 0.65 per equity share (32.50 per cent) for the year ended March 31, 2023, subject to approval.

Advances by the bank grew 14 per cent YoY on account of a rise in retail and agricultural loans. In retail credit, personal and vehicle loans had the highest growth of 49 per cent and 31 per cent, respectively.

Goel said the bank would aim at 12-13 per cent credit growth and 10-11 per cent deposit growth in FY24.

Its capital adequacy ratio was 15.5 per cent as on March 31, comfortably above the regulatory requirement.