Punjab National Bank (PNB) Q4 99/00 earnings summary

Executive summary

• FY1999-2000 net profit rose to Rs. 408.14 crore from Rs. 372.12 crore; operating profit was nearly flat at Rs. 820.16 crore versus Rs. 821.27 crore.

• Deposits grew 16.4% to Rs. 47,483 crore and advances grew 18.5% to Rs. 22,572 crore at March 2000.

• Priority-sector credit reached 44.9% of net bank credit, exceeding the 40% national target; capital-to-risk assets ratio was 10.31%, above the 9% minimum.

Financial highlights

• Total income was Rs. 5,882.21 crore versus Rs. 4,992.65 crore; interest earned was Rs. 5,154.55 crore versus Rs. 4,447.96 crore.

• Total expenditure was Rs. 5,474.07 crore versus Rs. 4,620.53 crore; interest expense rose to Rs. 3,538.20 crore from Rs. 2,795.36 crore.

• Net profit was Rs. 408.14 crore, up 9.7% YoY; Rs. 96 crore of wage-revision payment/provision and a change in term-deposit interest calculation weighed on operating profit.

• Working funds rose to Rs. 54,129 crore from Rs. 46,323 crore; capital and reserves increased to Rs. 2,273 crore from Rs. 1,930 crore.

Outlook and guidance

• An IPO was planned during FY2000-01 to augment the capital base.

• Plans called for computerising another 650–700 branches by December 2000, targeting coverage of 70% of business versus 36% at March 2000.

• Planned growth initiatives included insurance, card and gold businesses, net banking, and wider use of technology to diversify services and strengthen core banking.