Punjab National Bank’s Q3 Profit Misses Estimates; Asset Quality Stable
Punjab National Bank’s shares saw volatility after its third quarter earnings.
Shares of Punjab National Bank swung between gains and losses after a near three-fold jump in net profit for the October-December quarter.
Net profit grew 305 percent to Rs 207 crore from Rs 51 crore in the same period last year, according to the lender’s exchange filing. However, the figure was way below the Bloomberg consensus estimate of Rs 613 crore.
Net interest income decreased 9 percent to Rs 3,731 crore, as compared to Rs 4,120 crore in the year ago period. This too missed analyst estimates of Rs 3,973 crore.
Capital adequacy ratio stood at 11.62 percent, higher than the 11.5 percent required by the end of fiscal 2019 under Basel III norms.
Asset Quality Performance
Punjab National Bank’s gross bad loans declined 1.4 percent to Rs 55,627.5 crore from Rs 56,465.6 crore in the July to September quarter. Gross non-performing loans as a percentage of assets increased marginally to 13.7 percent from 13.63 percent in the previous quarter. Net non-performing assets remained flat at 9.09 percent compared to 9.1 percent in the previous quarter. Fresh slippages stood at Rs 4,800 crore as compared to Rs 5,089 crore in the previous quarter. The total slippages now stand at Rs 5,600 crore, almost Rs 600 crore lower than the second quarter.
Provisions increased 51.6 percent to Rs 3,363.21 crore on a sequential basis, while the provisioning burden declined 10.7 percent, compared to the corresponding quarter last year. The provision coverage ratio stood at 54.96 percent.
Shares were trading higher by 3.9 percent at Rs 155.