PNB profit to top Rs 20,000 cr in FY27: MD
New Delhi: Enthused by the consistent financial performance of the last four quarters, Punjab Bank MD and CEO Ashok Chandra exuded confidence that the bank's
New Delhi: Enthused by the consistent financial performance of the last four quarters, Punjab Bank MD and CEO Ashok Chandra exuded confidence that the bank's profit would surpass the Rs 20,000 crore mark this financial year.The public sector lender had earned a net profit of Rs 16,904 crore in the previous financial year.From the second quarter of last financial year, the bank has been maintaining a net profit of over Rs 5,000 crore every quarter, Chandra told PTI in an interview."We have maintained the same trend in the first quarter (ongoing financial year). And I am hopeful and confident that with the profitable growth, which is happening in the system....we will be surpassing the Rs 5,000 crore number and every quarter will be reaching a new height," he said.Asked if the bank can cross the Rs 20,000 crore mark during FY27 at this run rate, he said, "If I am telling that every quarter Rs 5,000 crore of net profit will happen, I think that goes to that figure which you are talking about".To achieve the target, he said, the bank is focusing heavily on conducting mega outreach activities every quarter on a very large scale.Besides, he said, retail, agri, MSME, and self-help groups are going to be the focus areas for asset creation.Overall, loan growth will be 12-13 per cent while deposits would be growing at 9-10 per cent during the ongoing financial year, he added.Chandra also said the bank would enter into acquisition finance in the third quarter of the current financial year as the RBI recently opened the window for lenders.Earlier this year, the Reserve Bank came out with final guidelines on acquisition finance by banks, increasing the lending limit to up to 75 per cent of the deal value from the 70 per cent proposed in the draft rules."The acquisition finance market is a very, very big market and ample opportunities are there in the system. We have got our policy approved for the acquisition financing in the last board meeting," he said."We are looking for a good partner and then maybe from Q3 onwards, we will be initiating some work in the acquisition financing."To begin with, he said, the bank would be starting acquisition finance with the domestic entities, and this will help the bank to diversify its asset portfolio.While permitting the activity from July 1, the RBI listed out a set of conditions to be met while banks do such financing activities, including a corporate guarantee from the acquiring company and ensuring that the debt-to-equity ratio does not exceed 3:1 post-acquisition on a continuous basis.The equity shares or compulsorily convertible debentures acquired by the acquiring company shall be free from any encumbrance; a borrower needs to have a net worth of at least Rs 500 crore and a net profit for three years, and the unlisted entities should additionally enjoy investment-grade ratings, the RBI had said.
The BriefWire