PNB Q2 Results Preview: Net profit likely to jump 280% YoY to ₹1,563 crore; asset quality to improve

livemint.com:

Punjab National Bank (PNB), the state-run lender, is set to report its financial results for the second quarter of FY24 today, October 26. The meeting of the Board of Directors of PNB is scheduled for today to declare Q2FY24 earnings. The public sector bank PNB is expected to report strong earnings for the second quarter of FY24 on the back of lower provisions with steady loan growth.

While net profit and interest income are likely to rise, net interest margin may see contraction on the back of increase in cost of funds. Earnings growth for the overall public sector banks is likely to remain robust in the July-September quarter of FY24, aided by controlled credit costs, though margins may moderate. Opex is likely to remain elevated as banks provide for wage revisions.

Treasury performance should be sluggish during the quarter due to an increase in bond yields after a robust Q1FY24. Also Read: Axis Bank share price gains after strong Q2 results; should you buy, sell or hold the stock? PSU banks’ loan growth should recover on a sequential basis, led by improved corporate demand and ongoing traction in the retail and MSME segments. Asset quality improvement is likely to continue, while healthy PCR and a sharp decline in SMA asset pool will lead to further moderation in credit costs, analysts said.

Punjab National Bank (PNB) is expected to report a net profit of ₹1,563 crore in the July-September of FY24, registering a growth of 280% from ₹411.3 crore in the corresponding quarter of last fiscal, as per average analysts estimates. The bank’s net interest income (NII) in Q2FY24 may see a growth of 16% to ₹9,594 crore from ₹8,270.7 crore in the year-ago period. Net interest margin (NIM) is expected to contract sequentially led