Punjab National Bank reported 57 per cent fall in net profit at Rs 306.36 crore for the
quarter ended June 30, 2016 against Rs 720.71 crore in the corresponding
quarter a year ago. For the sequential quarter ended March 31, 2016, it
had reported a net loss of Rs 5,367.14 crore. Total income of Punjab
National Bank jumped by 3.71 per cent year-on-year to Rs 13930
crore.
Net interest income of the bank declined by 9.83 per cent to Rs
3699 crore during the quarter under review against Rs 4102.47 crore in
the same quarter last year. Brokerage House ICICI Securities was
expecting first quarter net profit of Rs 1,089.20 crore from Punjab
National Bank.
Gross non-performing assets (NPAs) of the bank as a percentage of
advances more than doubled to 13.75% from 6.47% in the year-ago period.
Net NPAs also touched 9.16% from 4.05% in the year-ago quarter.
The NPA ratios have increased even when compared to the preceding quarter when the bank had reported a record loss of Rs.5,367
crore, hit by the sharp increase in bad debts and need for greater
provisioning.
In the April-June quarter, provisions other than for tax increased to Rs.2,738 from Rs.1,811 in the year-ago period.
All banks were forced to clean up their books make higher
provisioning and classify more loans as bad debts after the Reserve Bank
of India mandated it following an asset quality review. As a result,
most of the state-run banks reported losses in the March quarter.
In the quarter, PNB’s net interest income contracted to Rs.3,699 crore from Rs.4,102 crore in the year-ago period. Other income also fell to Rs.2,355 crore from Rs.1,397 crore.
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