The Hindu Business Line : PNB sees credit growth at 29%

Mumbai, Dec. 29 Punjab National Bank is likely to see credit growth in the range of 28-29 per cent this fiscal, said Dr K.C. Chakrabarty, the bank’s chairman and managing director. “There is robust demand for credit from all sectors. General consumption and need-based consumption will continue,” he said, speaking to reporters here on Monday.

As on December 19, the bank had a year-on-year growth of 29 per cent in deposits and 34 per cent in credit. In the three-month period between September to December, the total loan portfolio had grown from Rs 1,24,000 crore to around Rs 1,37,000 crore.

The bank’s loans to NBFCs were around Rs 7,000 crore. The direct exposure to commercial real estate was 7.5 per cent of total advances, while the total direct and indirect exposure, which includes loans to housing finance companies, was around 20 per cent.

Slippages

About a likely rise in bad assets, Dr Chakrabarty said the problem of slippages would begin from June 2009 onwards. “We expect gross NPAs at 2 per cent and net NPAs at 0.4 per cent by March 2009,” he said. The bank’s proposal to sell its stake in the primary dealership, PNB Gilts, was still on; but it was difficult to find buyers in the current market, Dr Chakrabarty said.

The bank is also likely to launch its credit card business from January, with Visa as the partner to begin with, he said. PNB has also received approval from the Royal Monetary authority for setting up Druk PNB Bank Ltd, a joint venture bank between PNB and Bhutanese Promoters, it said in a BSE notification.

New housing scheme

PNB has also launched a new housing loan scheme, “PNB Special Housing Loan Scheme’ for new accounts from January 1, 2009 to June 30, 2009, whereby 8.5 per cent will be charged under fixed housing loan option up to Rs 5 lakh, for the maximum period up to 20 years.

For fixed rate housing loans of above Rs 5 lakh to Rs 20 lakh, 9.25 per cent interest will be charged for a maximum period of up to 20 years.

The interest rate will be subject to reset on July 1, 2014 for the scheme.

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