The Hindu Business Line : PNB net up 2.07 pc in '05-06; declares 30 pc dividend

FINANCIAL PERFORMANCE: Mr S.C. Gupta, CMD, Punjab National Bank, flanked by Mr K. Raghuraman, Executive Director, (right) and Mr Arun Kaul, General Manager (Finance), at a press conference in the Capital on Thursday. — Kamal Narang

New Delhi , May 18

Punjab National Bank (PNB) plans to raise fresh capital (tier-II) of about Rs 1,000 crore before June to fund its expected business growth in the current fiscal, the Chairman and Managing Director of the bank, Mr S.C.Gupta, has said.

"We have the mandate of the board to raise Rs 1, 000 crore towards tier-II capital. We will raise it in the first quarter itself from the domestic market and institutions. There is enough headroom to raise tier-II capital," Mr Gupta said at a press conference to announce the financial performance of the bank for the financial year 2005-06.

PNB has reported a net profit of Rs 1,439.31 crore for the financial year ended March 31, 2006, which reflects a 2.07 per cent growth compared to the net profit of Rs 1,410.12 crore recorded in the previous year. Total income of the bank increased to Rs 10,815 crore from Rs 10,136 in the previous year.

Operating profit of the bank touched Rs 2,874.78 crore (Rs 2,404.46 crore).The board of directors has recommended a final dividend of 30 per cent, taking the overall dividend for the financial year to 60 per cent. For financial year 2004-05, the bank had paid a dividend of 60 per cent.

Q4 net down

However, net profit of the bank for the fourth quarter (January-March 2006) declined to Rs 288.67 crore compared to Rs 360.63 crore in the same quarter in the previous year. "The profits are down in the fourth quarter mainly because of provisioning of depreciation in our government securities portfolio", Mr Gupta said.

He pointed out that the bank's operating profit for the fourth quarter was higher by 95.4 per cent to Rs 998.27 crore as compared to Rs 510.97 crore in the same quarter in the previous year. For the financial year 2006-07, PNB has targeted a nearly 18 per cent growth in business to Rs 2, 28,000 crore as compared to level of Rs 1,94,000 crore in 2005-06. Mr Gupta also said that PNB was open to inorganic growth, but was quick to point out that there were no proposals under consideration as of now.

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