NEW DELHI: Punjab National Bank (PNB) on Friday reported over five-fold jump in its net profit to Rs 1,159 crore for the March 2023 quarter, helped by lower bad loans and a rise in interest income.
The state-owned bank had earned a standalone net profit of Rs 202 crore in the year-ago period.
During the quarter, the bank's total income increased to Rs 27,269 crore from Rs 21,095 crore a year ago, PNB said in a regulatory filing.
Interest income grew to Rs 23,849 crore during the period under review against Rs 18,645 crore in the year-ago period.
Net interest income increased by 30.05 per cent to Rs 9,499 crore in Q4 FY23, the best-ever in the last five quarters, PNB managing director Atul Kumar Goel said.
The bank has done a recovery of Rs 29,000 crore in FY23 and aims for Rs 22,000 crore in the current financial year as money is expected from the NCLT cases and other means.
The bank's board has recommended a dividend of Rs 0.65 per share or 32.5 per cent of Rs 2 face value out of the net profits for the year ended March 31, 2023.
Gross Non-Performing Assets (NPAs) were reduced to 8.74 per cent of gross advances as of March 31, 2023, from 11.78 per cent by the end of March 2022.
Net NPAs also came down to 2.72 per cent of the advances from 4.8 per cent at the end of 2022.
Goel said gross NPA should moderate below 7 per cent, while net NPAs to come down below 2 per cent by the end of March 2024.
The fall in the bad loans ratio helped cut the provisions towards NPAs for Q4FY23 to Rs 3,625 crore compared to Rs 4,564 crore a year ago.
Goel said that net interest margin (NIM) improved by 48 bps to 3.24 per cent in Q4 FY23 from 2.76 per cent in the same quarter a year ago.
For the current fiscal, the bank anticipates the NIM to be in the range of 2.9-3 per cent as there is pressure on deposit rates to grow the liability.
However, the bank reported a 27 per cent decline in net profit for the entire financial year 2022-23 to Rs 2,507 crore against Rs 3,457 crore in the same period a year ago.
The capital Adequacy Ratio (CAR) of the bank increased to 15.50 per cent from 14.50 per cent at the end of March 2022.
On the capital raising, he said, the bank intends to mop up Rs 12,000 crore from Tier I and Tier II bonds to fund business growth as the bank expects credit growth of 12-13 per cent in the current fiscal.
Out of the total, Rs 7,000 crore from Tier I while Rs 5,000 crore from Tier II bonds, he said.
On the deposit side, he said, the bank is aiming at a growth of 10-11 per cent during the financial year ending March 2024.
Goel said that the bank aims for a profit in access of Rs 4,000 crore profit in the current financial year.
Asked if the bank has any exposure in Go First, he said, there is nil exposure in the airline.
Earlier this month, Go First filed for protection under Section 10 of the Insolvency and Bankruptcy Code (IBC) in 2023.
On a consolidated basis, the bank's net profit in Q4 FY23 significantly increased to Rs 1,864 crore against Rs 245 crore in the same period a year ago.
Total income during the quarter also fell to Rs 28,132.23 crore from Rs 21,350.59 crore.
The full-year consolidated net profit of the bank stood at Rs 3,348.45 crore, down from Rs 3,675.96 crore.
Total income during 2022-23, however, rose to Rs 99,084.88 crore as against Rs 88,339.49 crore in 2021-22.
The provisioning coverage ratio as on March 31, 2023, works out to 86.90 per cent against 81.60 per cent as on March 31, 2022, it said.
The board approved the raising of equity capital by way of the issue of up to 15 crore new equity shares of the face value of Rs 2 each to the employees of the bank through an 'Employees Stock Purchase Scheme', subject to the approval of the shareholders at the ensuing Annual General Meeting of the bank and other regulatory approvals.