“In the June quarter, we have recovered Rs 7,057 crore. In the September quarter, the total recovery was Rs 8,564 crore. This means we are on the right track, whatever the target per quarter. Certainly, we are able to achieve Saksham will be targeted (for the financial year),” Goyal said.
The state-owned lender posted a net profit of Rs 411 crore in the second quarter ended September of the current fiscal, down nearly 63 per cent from the same period a year ago. However, profit increased by 33.4 per cent from the previous quarter ended June 2022.
The main reason behind the decline in net profit was higher provisioning for bad loans.
The bank’s provisioning for Q2FY23 increased to Rs 3,556 crore as against Rs 2,693 crore in the year-ago period.
“I had to make a major provision of Rs 3,556 crore for NPAs (non-performing assets). In addition, around Rs 450 crore, we were required to provide for non-performing investments (NPIs). In addition, around Rs 900 crore were required to be provided. As per the circular dated June 2019, Rs. Crore was to be done for the standard account reserve Bank of India, So, we needed to provide for it.
“So that was the prime reason (for higher provisioning) otherwise our credit cost is coming down and slippages are also coming down,” the official said, explaining the higher provisioning despite the fall in NPA ratio.
PNB’s gross non-performing assets declined to 10.48 per cent for the quarter ended September 2022, as against 13.63 per cent at the end of September 2021. Sequentially it was also down from 11.27 per cent in the quarter ended June 2022.
Further, Goyal said that an account in PNB’s account can be standard. However, if it is a non-standard account with another bank, the provision still needs to be made.
“This was the reason for the odd figure of Rs 900 crore that we were required to provide.”
The official said the slippage of the bank should be less than the number of recoveries as it happened in both the June and September quarters.
He said that as of today the situation is comfortable. “I am not getting any amount more than Rs 100 crore which we have to recognize as NPA in future.”
The fresh slippages during the first half of 2022-23, April-September period, fell to Rs 9,606 crore from Rs 13,299 crore in the same period. It was Rs 5,301 crore as against Rs 7,620 crore for Q2FY23.
Responding to a query regarding accounts referred to National Asset Reconstruction Company Limited (NARCL), he said that PNB has identified 62 accounts with outstanding of Rs 20,008 crore.
Of this, for the first phase, the bank has identified nine accounts worth Rs 2,752 crore. In the second phase, there are around 11 accounts worth Rs 2,685 crore. Out of the first phase, Rs 2,752 crore in five accounts, NARCL has proposed where PNB owes Rs 1,099 crore,” Goyal said.
Regarding recovery from bad accounts referred NCLTHe said, there was a recovery of Rs 693 crore in the June quarter and Rs 778 crore in the September quarter.
“And we expect to recover Rs 1,936 crore in the December quarter and Rs 588 crore in the March 2023 quarter.”
The lender has also shut down its branch operations in Hong Kong. Its principal assets and liabilities have been repatriated to settlement, principal capital and accumulated profits.
The MD and CEO said that around Rs 252 crore has been refunded from the Hong Kong branch.