Punjab & Sind Bank is one of the few banks to report steady growth both on its retail and corporate loans side in the fiscal first quarter while keeping the recoveries robust. The state-owned bank continued to report a profit for the second straight quarter, backed by cash recovery and upgrades of Rs 753 crore.

“The big NPA (non-performing asset) resolutions are now centralised. We have a dedicated team working on them. We will continue to be on the path of recovery by growing our advances while keeping a check on the asset quality,” Punjab & Sind Bank managing director and CEO S Krishnan told reporters.

The bank reported a net profit of Rs 173.85 crore for the first quarter ended June 30 compared to a net loss of Rs 116.89 crore a year ago. Sequentially, the bank had posted a net profit of Rs 160.79 crore in the March 2021 quarter, after reporting losses for eight consecutive quarters.

Improving on all parameters, the bank’s total income rose to Rs 2,039.61 crore in the June quarter from Rs 1,954.39 crore in the year-ago period. Net interest margin improved 25 basis points to 1.95% sequentially. Net interest income (NII) grew 7.82% to Rs 579 crore from Rs 537 crore a year ago. On a quarter-on-quarter basis, NII increased 16.97%.

The bank's asset quality showed an improvement and the gross NPAs came down to 13.33% of the gross advances as of 30 June 2021, against 14.34% a year ago. In absolute value, the net NPAs stood at Rs 9,054.96 crore, up from Rs 8,848.06 crore. The net NPAs ratio fell to 3.61% (Rs 2,206.70 crore), from 7.57% (Rs 4,326.41 crore).

Provisions for bad loans and contingencies for the quarter fell to Rs 77.30 crore from Rs 382.56 crore in the year-ago period.

The bank had upgrades of Rs 539 crore worth of loans and had fresh slippage of Rs 442.83 crore. It wrote off over Rs 32 crore of loans.

Punjab & Sind Bank said it has kept the account of Delhi Airport Metro Express Pvt Ltd (DAMEPL) as standard, in accordance with the Supreme Court order and RBI guidelines.

The bank has not treated an outstanding of Rs 166.63 crore towards DAMEPL as NPA, it said. It has held the provisions of Rs 92.24 crore against this, higher than the required Rs 49.59 crore.

The provision coverage ratio of the bank stood at 84.22% as of 30 June 2021, and the liquidity coverage ratio at 215.52%.

Total advances grew 10% over the corresponding quarter of the previous fiscal to Rs 67,933 crore. This was led by loans to the infrastructure sector, which grew 22.28% over the year-ago period to Rs 15,477.82 crore at the end of the June quarter. Retail loans grew by 8.08% to Rs 8,884 crore, agriculture loans by 12.27% to Rs 9,710 crore and MSME loans by 12.87% to Rs 11,135 crore.

Total deposits grew 15.55% to Rs 98,478 crore as of 30 June 2021. While current deposits grew 18.46%, savings account deposits rose 13.79%.

Shares of the bank jumped 4.37% to close Thursday at Rs 20.30 apiece on BSE.