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Kolkata: Punjab National Bank on Tuesday reported an 18% fall in net profit for the September quarter due to rise in provision to cover bad loans and Covid-related risk even as its net interest margin improved.
The country's second largest state-owned lender posted a net profit of Rs 621 crore for the quarter under review compared with Rs 757 crore in the year ago period. The bank's operating profit grew 7% at Rs 5675 crore on nearly flat business growth.
Provision against bad loans was Rs 3811 crore against Rs 3253 crore for the same period.
Managing director SS Mallikarjuna Rao said the bank is expecting 4-6% rise in advances in the second half of the fiscal. It's credit growth was merely 0.6% year-on-year to Rs 716924 crore at the end of September.
Rao said the bank has not renewed cost deposits and certificates of deposits worth Rs 27000 crore which helped its NIM to improve to 3.21% in second quarter from 2.58% in the year ago period.
"We are not carrying any high cost deposits now," he said.
The CASA (current and savings account) ratio, which is key to profitability, improved 253 basis points over the year to 44.1%.
Rao said the Covid-led risk is likely to be lower than what was expected earlier. Gross non-performing assets ratio was at 13.43% while net NPA stood at 4.75% at the end of September.
The country's second largest state-owned lender posted a net profit of Rs 621 crore for the quarter under review compared with Rs 757 crore in the year ago period. The bank's operating profit grew 7% at Rs 5675 crore on nearly flat business growth.
Provision against bad loans was Rs 3811 crore against Rs 3253 crore for the same period.
Managing director SS Mallikarjuna Rao said the bank is expecting 4-6% rise in advances in the second half of the fiscal. It's credit growth was merely 0.6% year-on-year to Rs 716924 crore at the end of September.
Rao said the bank has not renewed cost deposits and certificates of deposits worth Rs 27000 crore which helped its NIM to improve to 3.21% in second quarter from 2.58% in the year ago period.
"We are not carrying any high cost deposits now," he said.
The CASA (current and savings account) ratio, which is key to profitability, improved 253 basis points over the year to 44.1%.
Rao said the Covid-led risk is likely to be lower than what was expected earlier. Gross non-performing assets ratio was at 13.43% while net NPA stood at 4.75% at the end of September.
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