Punjab National Bank reported 45.82% growth in total consolidated revenues in the Dec-20 quarter at Rs23,639cr. However, the quarter ended Dec-20 includes the numbers of the amalgamated entity consisting of PNB, Oriental Bank of Commerce and United Bank of India combined. These banks were combined under order from the Ministry of Finance. This led to a sharp spike in the total interest income even as corporate lending remained stressed.
For the Dec-20 quarter, the operating profits were up 72.47% at Rs6,557cr. This was due to the interest expended growing much slower than the interest income leading to a widening of the NIM. As a result, operating margin or OPM expanded from a level of 23.45% in Dec-19 to 27.74% in Dec-20 quarter.
Profit after tax (PAT) for the Dec-20 quarter turned around to a profit of Rs747cr from a net loss of Rs385cr. While the provisions did grow overall, the NPA provisions tapered you. But the merger resulted in better utilization of combined resources. The net margins for the Dec-20 quarter stayed at a moderate level of 3.16%.
The bank also saw gross NPAs lower at 12.99% but that is still elevated absolute terms. Even net NPAs at 4.03% are still high to give any level of comfort. As a result, the annualized ROA at 0.15% is below the ideal ROA for banks which should be in the range of 0.5% to 0.6%. The capital adequacy level is the constraint at 13.88% which could seriously constrain asset book expansion of PNB unless more capital is raised.
Financial highlights for Dec-20 compared yoy and sequentially
|
|
Punjab National Bank |
|
|
|
|
Rs in Crore |
Dec-20 |
Dec-19 |
YOY |
Sep-20 |
QOQ |
|
Total Income |
₹ 23,639 |
₹ 16,211 |
45.82% |
₹ 23,844 |
-0.86% |
|
Operating Profit |
₹ 6,557 |
₹ 3,802 |
72.47% |
₹ 5,838 |
12.31% |
|
Net Profit |
₹ 747 |
₹ -385 |
N.A. |
₹ 576 |
29.70% |
|
|
|
|
|
|
|
|
Diluted EPS |
₹ 0.78 |
₹ -0.65 |
|
₹ 0.61 |
|
|
Operating Margins |
27.74% |
23.45% |
|
24.48% |
|
|
Net Margins |
3.16% |
-2.37% |
|
2.42% |
|
|
Gross NPA Ratio |
12.99% |
16.30% |
|
13.43% |
|
|
Net NPA Ratio |
4.03% |
7.18% |
|
4.75% |
|
|
Return on Assets |
0.15% |
-0.23% |
|
0.19% |
|
|
Capital Adequacy |
13.88% |
14.04% |
|
12.84% |
|
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