PNB Q1 profit inches up 2.4% to Rs 1,275 crore
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PNB Q1 profit inches up 2.4% to Rs 1,275 crore

Last Updated: Friday, July 26, 2013, 16:47
 
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PNB Q1 profit inches up 2.4% to Rs 1,275 crore
New Delhi: Punjab National Bank (PNB) on Friday posted a marginal 2.4 percent growth in net profit at Rs 1,275 crore during the first quarter of the ongoing fiscal due to higher provisioning.

The bank had a net profit of Rs 1,246 crore during the April-June quarter of the previous fiscal.

Total income of the bank rose to Rs 11,747 as against Rs 11,722 crore in the same quarter a year ago, PNB Chairman and Managing Director K R Kamath said here.

However, interest income during the quarter declined by 1.4 percent at Rs 10,405 crore against Rs 10,554 crore in the first quarter of the previous fiscal.

The gross non-performance asset (NPA) as a proportion of advances went up significantly to 4.84 percent against 3.34 percent at the end of June last year. Net NPA also rose to 2.98 percent during the period from 1.68 percent in the same period of previous year.

In absolute terms, the gross NPA rose by 51 percent to Rs 15,090 crore while net NPA increased by 84 percent to Rs 9,060 crore at the end of June 2012 on year-on-year basis.

One big account in gems and jewellery segment (Winsome Diamonds and Jewellery) failed during the quarter, he said, adding, Rs 1,600 crore turned NPA.

Thus, the bank made provision of Rs 401 crore for exposure to the Winsome account out of the total provision of Rs 674 crore during the quarter.

When asked if the bank is considering to further lower the base rate, Kamath said there is no plan as of now.

"We are watching the market," he said.

On a deposit rate hike he said, there is no plan as liquidity is comfortable as of now.

Asked about rising bad loans, Kamath said: "This has been an area of concern but we have been able to contain this in the last two quarters."

Lower than expected performance, pulled down shares of PNB by 5.15 percent to Rs 595.95 apiece at the end of today's trading session on the BSE.

Talking about the cash recovery, he said, the bank during the quarter earned Rs 803 crore on this account while there was a write-off to the tune of Rs 799 crore.

The bank has recovered Rs 80 crore by selling assets of the beleaguered Kingfisher Airlines.

On the bulk deposit front, he said, the bank has reduced it from 22.16 percent to 8.8 percent at the end of June 2013.

Asked if PNB will start its operation in Pakistan, he said this is subject to various approvals including from the respective regulators.

The bank's net interest margin (NIM) declined to 3.52 percent from 3.60 percent during June end, 2012.

Capital adequacy of the bank at the end of June 2013, as per Basel-II norms, was 12.44 percent.

PTI




First Published: Friday, July 26, 2013, 12:25


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