Punj Sind Bank

The market is apparently very happy with the Q1FY16 performance of Punjab &Sind Bank as it has shown a very good jump in profitability. YoY, its asset quality has also improved but QoQ, it has not been as good. Its net profit more than doubled from Rs.21 crore to Rs.43 crore (YoY), up over 101%. NII showed a 31% jump at Rs.517 crore. This jump in profit was despite the provisions showing a 32% (YoY) rise at Rs.216 crore; QoQ, it has come down 17%. Total business of the bank showed an over 8% (YoY) improvement with deposits showing a 6.5% rise and advances were up 11%.

In terms of asset quality, Gross non-performing assets (NPAs), or bad loans, stood at 5.17% gross advances v/s 5.22% (YoY) but sequentially, it has risen from 4.76%. QoQ is a more pertinent comparison when looking at asset quality as it is more important to know how it is faring on the NPA front QoQ as that shows whether things are improving or deteriorating. Net NPA was once again looking good YoY – down from 3.87% to 3.65% but QoQ, it has risen from 3.55%.  Capital adequacy ratio was at 10.43% v/s 11.24% (QoQ).