Fall in bad loans helps PNB post Rs506 cr Q3 profit

BBN Report

Net NPA down to 4.03 pc from 7.18 pc a year earlier

MUMBAI/February 05-2021: A substantial decline in bad loans helped the second largest public sector bank in the country, Punjab National Bank (PNB), post on Friday standalone net profit of Rs506.03 crore for the third quarter (Q3) ending December 31, 2020.

The state-owned bank had posted a net loss of Rs492.28 crore for the same period a year earlier. Total income in the quarter under review grew to Rs23,298.53 crore as against Rs15,967.49 crore a year ago.

NII up

Net interest income (NII) grew by 28 per cent to R 8,313 crore during the period whereas the total expenditure of the bank fell by 10.9 per cent to Rs16,908 crore.

Provisions against non-performing loans (NPLs) and contingencies stood at Rs5,432.60 crore for Q3 of 2020-21, compared with a lower Rs4,146.04 crore set aside for the same period last year.

On a consolidated basis, the profit was Rs 85.77 crore during the said period, while it was a net loss of Rs 501.93 crore in the same period last year.

Consolidated income increased to Rs23,639.41 crore from Rs16,211.24 crore. However, PNB said the current results are not comparable with that a year ago as the December quarter 2019-20 figures are of the pre-amalgamated period.

UBI, OBC merged with PNB

With effect from April 1, 2020, PNB merged United Bank of India (UBI) and Oriental Bank of Commerce (OBC) with itself.

Asset quality improves

The bank witnessed substantial improvement on the asset quality front, with gross non-performing assets (NPAs) as a percentage of gross advances falling to 12.99 per cent as of December-end 2020 from 16.30 per cent a year earlier.

In absolute value terms, gross NPAs stood at Rs94,479.33 crore as against Rs76,809.20 crore. The net NPA ratio also softened to 4.03 per cent (Rs26,598.13 crore) from 7.18 per cent (Rs 30,518.92 crore).

The bank’s global business has reached Rs18,09,587 crore and global NIM improved to 3.09 per cent in Q3,FY21, PNB said in a release.

The bank said the achievement under priority sector credit was 42.4 per cent at Rs2.84 lakh crore by the end of December 2020.

With a total of 10,925 branches across India, PNB has two overseas branches — Hong Kong and Dubai.

The lender said that all the branches of the erstwhile OBC and UBI’s core banking solution (CBS) have been upgraded from Finacle 7 to Finacle 10 and are integrated with PNB. More than 18 crore customers of PNB 2.0 are now on the same platform, it added.

The bank’s domestic deposits fell marginally to Rs10.52 lakh crore, even as advances were slightly up at Rs7.04 lakh crore.

On its financial inclusion initiatives, bank said as many as 3.94 crore accounts have been opened under the Pradhan Mantri Jan Dhan Yojana as of December 2020 with average balance of Rs4,021.

 

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