Punjab National Bank (PNB) reported a strong first quarter of FY24, with net profit more than quadrupling from the previous year. The bank’s net profit was ₹1,255.4 crore in Q1FY24, compared to ₹308.4 crore in the same quarter of last fiscal. This was driven by a number of factors, including:
- Strong revenue growth: NII, which is the difference between interest earned and interest expended, increased 26% year-on-year to ₹9,504.3 crore in Q1FY24. This was due to a combination of higher interest rates and an increase in the bank’s loan book.
- Improving asset quality: Asset quality also improved sequentially, with gross non-performing assets (NPA) as a percentage of gross advances declining to 7.73% from 8.74%. Net NPA as a percentage of net advances fell to 1.98% from 2.72%.
- Declining provisions: Provisions and contingencies declined 17.2% year-on-year to ₹3,965.26 crore in Q1FY24. This was due to the lower level of NPAs and the bank’s efforts to improve its recovery rates.
Overall, PNB’s performance in the first quarter of FY24 was encouraging. The bank’s revenue growth was strong, its asset quality improved, and its provisions declined. This suggests that PNB is on track to meet its financial targets for the year.
- Deposits: Deposits rose 14.17% year-on-year to ₹12.98 lakh crore in Q1FY24. This was due to a number of factors, including the bank’s strong brand name and its focus on retail banking.
- Advances: Advances grew 16.30% to ₹863,731 crore in Q1FY24. This was driven by the bank’s focus on lending to small and medium enterprises (SMEs) and the government’s infrastructure spending program.
- Capital adequacy ratio: The bank’s Capital Adequacy Ratio – Basel-III – was at 15.54% in Q1FY24. This is well above the regulatory requirement of 13.5%, which indicates that the bank is well-capitalized.
Overall, PNB’s performance in the first quarter of FY24 was positive. The bank’s revenue growth was strong, its asset quality improved, and its capital position remains strong. This suggests that PNB is on track to meet its financial targets for the year.