© Reuters.
Indian Bank and Punjab National Bank (PNB) reported impressive financial results for the third quarter of 2023, with both banks experiencing significant growth in key metrics.
Indian Bank’s net profit rose 62% year-on-year to Rs 1,988 crore, driven by substantial growth in net interest income, operating profit, credit originations and non-interest income. The bank also reported a 25% reduction in provisions. SL Jain, managing director and chief executive officer of the bank, attributed this growth to steady improvements in key metrics.
Despite a fall in non-performing assets (NPAs), with gross non-performing assets falling from 7.30% to 4.97% and from 1.5% to 0.6% net, new slippages increased to Rs 1,976 crore. These came mainly from the agricultural sector and the corporate segment. However, the bank’s internal advances increased by 11%, driven by growth in retail, agriculture, MSME loans and corporate loans, which grew by 11%. These segments accounted for more than 62% of gross domestic loans.
While total cash recoveries were less than Rs 1,943 crore and CASA’s domestic share declined slightly, domestic deposits saw an increase of 7% and total recoveries (cash and improvements) were Rs 2,265 crore. The bank’s total business grew 10% year-on-year to Rs 11.33 lakh crore.
On the other hand, PNB’s Q2FY24 results showed net profit rising 327% to Rs 1,756 crore due to higher interest income and better credit quality. Net interest income rose 20% to ₹9,923 crore, while gross NPA fell to ₹65,563.12 crore and net NPA declined to ₹13,114.12 crore. Gross arrears as a proportion of gross advances decreased to 6.96%.
The bank’s global savings and business deposits grew 11.26% to ₹22,51,631 crore and ₹4,71,238 crore respectively, with current deposits at ₹67,038 crore. PNB achieved profitability of over Rs 3,000 crore in H1FY24 and focuses on retail, agriculture and MSME sectors.
Following the results, PNB shares recovered to ₹70.30 on BSE and settled at ₹69.81. CEO Goel expressed hope of maintaining profitability in the coming quarters, indicating a positive outlook for the bank’s future performance.
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