Scam-hit Punjab National Bank managed to claw its way back into black in the third quarter of the current fiscal year as bad loan levels fell, consequently reducing provisioning requirements. The bank recorded a net profit of Rs 247 crore for the quarter, compared to net losses in the three preceding quarters.
The bank had posted a mammoth net loss of Rs 13,417 crore in the January-March quarter of 2018, net loss of Rs 940 crore in the April-June quarter and Rs 4,532 crore in the July-September quarter. As for the October-December quarter of 2017, the bank had posted a net profit of Rs 230.11 crore.
The bank had slipped into losses after a Rs 14,000 crore scam allegedly perpetrated by jewellers Nirav Modi and Mehul Choksi with the connivance of certain bank officials came to light.
“Profitability from operations is going well, the asset quality is improving. The way forward, our provisioning requirement from the one-off incident (fraud) is no more. I am happy to announce that we are back in black,” PNB MD and CEO Sunil Mehta said.
Mehta added that the bank has consistently brought down its gross non-performing asset (NPA) levels from as high as over 18 per cent at the end of March 2018 to 16.33 per cent at December 2018. The bank also hopes to bring down its gross NPA by 200 basis points (2 percentage points) to around 14 per cent by the end of this fiscal year. Value-wise, gross NPAs of the bank stood at Rs 77,733.33 crore as on December 31, 2018 while net NPAs totalled Rs 35,675.12 crore. Provisioning for bad loans for the December quarter came down to Rs 2,565.77 crore as against Rs 2,996.42 crore in the same period last year.