Punjab National Bank's third quarter (October-December) earnings missed analyst
expectations on Tuesday, but asset quality improved sequentially.
Profit growth of
11 percent at Rs 230.11 crore and net interest income growth of 7 percent at Rs
3,989 crore year-on-year were below CNBC-TV18 poll of Rs 558.1 crore and Rs
4,122.9 crore, respectively.
Profit growth,
which was largely driven by other income & operating income, was capped by
higher provisions.
The public
sector lender has reported loan growth at 17 percent compared to year-ago.
The bank
showed a good improvement on asset quality front as gross non-performing assets
were lower at 12.11 percent compared to 13.31 percent in previous quarter. Net
NPAs were also lower at 7.55 percent from 8.44 percent on sequential basis.
In absolute
terms, gross NPAs were down by 0.2 percent sequentially at Rs 57,519.4 crore
and net NPAs fell by 1.4 percent to Rs 34,075.7 crore for quarter ended
December 2017.
But provisions
for bad loans remained at elevated levels, surging 80 percent
quarter-on-quarter and 74 percent year-on-year to Rs 4,466.7 crore in Q3.
Provision
coverage ratio at 60.78 percent in Q3 improved from 59.20 percent in previous
quarter.
PNB said the
bank has provided Rs 854 crore out of Rs 1,112 crore for accounts under RBI's
first list and Rs 75 crore out of Rs 875 crore for accounts under RBI's second
list.
Other income or
non-interest income grew by 44 percent year-on-year to Rs 3,082.02 crore and
operating profit increased 53 percent to Rs 4,245.19 crore in Q3.
Meanwhile, the
state-run lender informed exchanges that board of the directors today accorded
approval for capital infusion by Government of India upto Rs 5,473 crore.
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