PNB

Punjab National Bank (PNB) posted a set of dismal numbers for Q4FY14, with falling net profit, higher provisioning and increasing NPAs. It reported a 29% (YoY) drop in net profit at Rs.806 crore and the entire blame for this decline lay on higher provisioning. In fact provisioning for bad loans has risen 45% at Rs.2139 crore and this seriously dented the profits. Fresh slippages in the quarter were Rs.4,189 crore and loans restructured during the quarter were Rs.2,900 crore. Asset quality continues to remain bad with Gross NPA rising from 4.27% to 5.25% and Net NPA rising from 2.35% to 2.85% (YoY).

Its interest income for the quarter was up 7% at Rs.11101 crore while net interest income rose 6% at Rs.4002 crore. NIM fell from 3.51% to 3.2%. The rise of 19% in other income helped shore up at least some of the bottom line. For FY14, net profit dropped 30% at Rs.3343 crore. Advances during the fiscal rose 13% at Rs.3.49 trillion and deposits were up 5% at Rs.4.51 trillion. The bank, prudently decided not to declare any final dividend though there was an interim dividend of Rs.10/share some months ago. The stress on asset quality is expected to continue for some more time, till demand picks up and the economy starts recovering.