PNB reports net loss of Rs 940 crore in Q1

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New Delhi, Aug 7: The scam-hit Punjab National Bank (PNB) reported a heavy loss of Rs 940 crore in the first quarter (April- June) of the financial year 2018-19. The bank had posted a net profit of Rs 343 crore in the corresponding quarter last year.
The fourth biggest Indian lender by assets, has now reported a back-to-back loss for the second straight quarter after it posted its biggest ever quarterly loss of Rs 13,417 crore in the fourth quarter of the last fiscal.
The heavy loss comes on back of the multi-crore fraud that hit the Brady House branch of the lender in Mumbai, involving diamantaires Nirav Modi and Mehul Choksi, among others.
Total income of the bank rose to Rs 15,072 crore from Rs 14,468.14 crore in the year-ago period.
The bank’s gross non-performing assets (NPAs) stood at 18.26 per cent for the quarter, a slight improvement from the 18.38 per cent in last quarter. Net NPAs also came at 10.58 per cent for the quarter.
Indian banks, including PNB, have also been hit by a surge in bad loans in recent years and have seen provisions accelerating as part of a clean-up exercise that includes sending defaulting borrowers into a nascent bankruptcy court framework.
The government recently injected Rs 2,816 crore in PNB to shore up its capital base. The bank also plans to sell an at least 51 per cent stake in PNB Housing Finance, jointly with private equity firm Carlyle Group LP, to raise funds.
In what has been dubbed as the biggest fraud in India’s banking history, PNB in February disclosed it had been defrauded it of more than Rs 13,000 crore by raising credit overseas using fake guarantees issued by rogue PNB staff at a Mumbai branch over several years.
The PNB stock took a plunge after the quarterly results were declared. At 2.37 pm, the PNB stock was down 7 per cent at Rs 83.85 on the BSE. The broader market, in comparison, was trading flat.