 "Punjab National Bank net beats estimates, rises 10% on fall in provisioning")
State-run Punjab National Bank, the country’s second largest public sector bank by asset size, reported a net profit growth of 10 percent on year for April-June due to a sharp fall in its provisions.
The bank’s net profit for the quarter stood at Rs 1,405 crore, higher than a CNBC-TV18 poll estimate of Rs 1,148 crore.
The bank’s provisioning during the quarter stood at Rs 927.61 crore, down 13 percent from the year-ago number of Rs 1,066.48 crore. Its other income also fell 8 percent to Rs 1,236.44 crore from Rs 1,342.05 crore a year ago.
The bank saw a sharp increase in its bad loans with gross non-performing asset ratio at 5.48 percent of total loans as against 4.84 percent a year ago.
The bank’s net interest income rose 12 percent to Rs 4,379.7 crore from Rs 3,907.51crore in the year-ago period.
Its operating profit during the quarter rose 5.1 percent on year to Rs 3,125.3 crore.
The banking sector is straddled with high non-performing assets as a wobbly economic revival is impacting the repayment loans by borrowers.
Canara bank, one among the leading state-run banks, early last week posted a marginal 1.86 percent increase in net profit at Rs 806.86 crore in the first quarter hit by higher provisioning, as compared with Rs792.07 crore in the year ago period.