He said the revival of the economy and focused recovery initiatives would help the lender to reduce the non-performing assets (NPAs).NPA) for single digits.
“We are primarily a consumption-led economy with a strong demographic dividend. As far as credit is concerned, it is expanding in double digits and will continue to do so despite rising interest rates. A strong economy, Budgetary support from the government to the capital-intensive sector, schemes like PLI (Production Linked Incentive), ECLGS (Emergency Credit Line Guarantee Scheme) and better consumption demand will pave the way for better credit growth. The banking sector is also strong and there is a chance to grab the upcoming. Well positioned for the opportunity,” Goyal told ET in an exclusive interview.
India It has become the fifth largest economy in the world, overtaking the United Kingdom and is expected to be the third largest by 2030.
He said, “When the developed world is going through a period of high inflation and policy makers are finding it difficult to reduce it, we are able to manage inflation expectations well. I hope that the Indian growth story Will continue.”
The Delhi-based lender has crossed Rs 8 lakh crore in global advances, showing a 10% year-on-year growth in retail loan portfolio with 11% growth and 25% growth in personal loans.
Goyal said that apart from retail, the focus is also on MSME, manufacturing, renewable energy and infrastructure sectors like roads. “All these sectors are being supported and increased investment through various policy initiatives,” he said.
However, its NPA ratio remained high at 11.2% despite recent reforms.
“We expect the gross NPA ratio to come down to single digit and the net NPA level below 4% by the end of the current financial year,” Goyal said. He said that the bank has set up different verticals for sourcing, sanctioning and monitoring of leads. of loans to improve underwriting standards.
He added the net interest margin of the bank (NIM) will remain in the range of 2.80-2.90% by the end of the year as against 2.79% seen in the June quarter.
The bank is permitted to raise up to ₹12,000 crore in one or more tranches – up to ₹5,500 crore through Basel-Ill compliant Additional Tier-1 (AT1) bonds and up to ₹6,500 crore in Tier-II bonds. “The approach will be gradual and will depend on business growth, market conditions and progress as per applicable laws/guidelines,” Goyal said.
Of the ₹5,500 crore AT1 plan for the year, the lender has already raised ₹2,000 crore in July. Goyal said, “Our CET1 (Common Equity Tier-1) stood at 10.94% even without raising any equity capital during the current financial year and the CRAR (Capital to Risk-weighted Asset Ratio) is expected to be around 14.5%. ”
Goyal said, “With all such initiatives, it is expected that going forward, quality credit growth will further improve the profitability of the bank. Gradual improvement in margins, stable operating efficiency with adequate provisioning buffer is sure to come. Will improve shareholder value in the times to come,” Goyal said. ,
PNB is planning to open 200 branches mainly in the southern and western parts of the country.