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PNB posts Q2 loss of Rs 4,532 crore as provisions rise

Scam-hit Punjab National Bank posted a ₹4,532 crore loss for the quarter to September due to a sharp..

By admin , in Markets , at November 3, 2018

Scam-hit Punjab National Bank posted a ₹4,532 crore loss for the quarter to September due to a sharp increase in provisioning. The Delhi-based lender had reported a profit of ₹560 crore in the year-ago quarter.

Banks share closed 7% down at ₹69.05 on the Bombay Stock Exchange (BSE) on Friday, a day when the banking sector barometer, the Bankex, gained over 1%. The exchanges benchmark index, the Sensex, closed 1.68% up.

PNBs managing director Sunil Mehta, however, expressed hope that the bank will be in the black by the end of this fiscal and that they have front loaded provisioning requirements.

PNB increased provisions to ₹9,757 crore up from ₹5,758 crore in the previous quarter, setting aside ₹7,773 crore for bad loans as against ₹4,982 crore in the previous quarter.

The provision coverage ratio saw an increase to 67% as of end September from 59% last year.

The bank has now posted losses in the last three quarters. Post Nirav Modi scam, it had posted a staggering loss of ₹13,416.91 crore for the fourth quarter 2017-18, the biggest ever by any domestic lender.

By July 2018, the bank had made provisions of ₹9,041.88 crore against the loss of around ₹15,000 crore in the scam. The bank said it has made provisions of ₹3,295.12 crore during the September quarter.

The remaining provision will be made during the next quarter of the current financial year as per terms of RBIs dispensation, it said. PNBs capital adequacy ratio stood at 10.08% at the end of the September quarter compared with 9.62% at the end of the yearago quarter.

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