Indian Bank and PNB Report Strong Q3 2023 Financial Performance

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Indian Bank and PNB  Report Strong Q3 2023 Financial Performance
Credit: © Reuters.

Indian Bank (NS: INBA ) and Punjab National Bank (NS: PNBK ) (PNB) have reported impressive financial results for the third quarter of 2023, with both banks experiencing significant growth in key metrics.

Indian Bank's net profit surged by 62% year-on-year to ₹1,988 crore, driven by substantial growth in net interest income, operating profit, credit offtake, and non-interest income. The bank also reported a 25% reduction in provisions. SL Jain, the bank's MD & CEO, attributed this growth to consistent improvements in key metrics.

Despite a fall in non-performing assets (NPAs), with gross NPA dropping from 7.30% to 4.97% and net NPA from 1.5% to 0.6%, fresh slippages rose to ₹1,976 crore. These were primarily from the agriculture sector and corporate segment. However, the bank's domestic advances increased by 11%, driven by growth in retail, agriculture, MSME loans, and corporate loans which grew by 11%. These segments represented over 62% of the gross domestic loans.

While total cash recoveries were lower at ₹1,943 crore and the domestic CASA share slipped slightly, domestic deposits saw a 7% increase and total recoveries (cash and upgradation) were at ₹2,265 crore. The bank's total business grew by 10% year-on-year to ₹11.33-lakh crore.

On the other hand, PNB's Q2FY24 results showed a net profit surge of 327% to ₹1,756 crore due to higher interest income and improved credit quality. The net interest income increased by 20% to ₹9,923 crore while gross NPA fell to ₹65,563.12 crore and net NPA decreased to ₹13,114.12 crore. The Gross NPA as a proportion of gross advances dropped to 6.96%.

The bank's global business and savings deposits grew by 11.26% to ₹22,51,631 crore and to ₹4,71,238 crore respectively, with current deposits at ₹67,038 crore. PNB achieved over ₹3,000 crore profitability in H1FY24 and is focusing on the Retail, agri, and MSME sectors.

Following the results, PNB shares recovered to ₹70.30 on BSE and settled at ₹69.81. CEO Goel expressed hope for maintaining profitability in the next quarters, indicating a positive outlook for the bank's future performance.

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