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The post-demonetisation surge in low-cost CASA deposits has helped Punjab National Bank record more than a four-fold jump in third quarter profit to ₹207 crore, from the ₹51 crore recorded in the year-ago period.
However, the December quarter’s bottomline performance was lower than the ₹549 crore recorded in the previous quarter.
Demonetisation had resulted in the inflow of a whopping ₹53,000 crore of CASA deposits into the bank between November 8 (when demonetisation was announced) and December 31. This has helped sharply bring down the cost of deposits to 5.38 per cent in end-December 2016 from 5.92 per cent in December 2015.
“Several factors, including reduced cost of deposits, focussed efforts of the bank to accelerate digitalisation and resolution of stressed assets, have led to this Q3 bottomline performance,” PNB’s Managing Director and CEO Usha Ananthasubramanian said.
Ananthasubramanian said CASA deposits had moved up to a whopping 47 per cent as of end-December 2016 from 42 per cent in end-September 2016, courtesy the demonetisation process.
CASA deposits now stood at about ₹2.6 lakh crore for the bank, the highest among public sector banks.
The extent of CASA growth could be gauged from the fact that such deposits stood at just ₹1.98 lakh crore in December 2015.
She also expects that at least 40 per cent of the increased CASA deposit flow will remain with the bank.
For the nine-month period ending December 2016, PNB reported a net profit of ₹1,063 crore (₹1,393 crore).
“Going by the performance so far, we are hopeful of returning to the black for the entire fiscal 2016-17,” she later told BusinessLine .
PNB has so far this fiscal effected cash recovery and upgradation of close to ₹15,000 crore, and is on course to meet its targets on this front for the entire year.
Ananthasubramanian said the PNB now had two lakh UPI customers, 60 lakh mobile banking customers and 80 lakh internet banking customers.
The bank has also crossed the ₹10-lakh crore business mark.
Pact with India Post Meanwhile, Ananthasubramanian announced that PNB had entered into an MoU with the India Posts Payments Bank (IPPB), which is expected to emerge as the country’s largest payments bank.
“Our support initially will be in the form of technology and people,” she said. Going forward, PNB expects to sell its loan products to those customers who open accounts with the IPPB.
While there has been a gush of deposits, the uptick in credit has been negligible. PNB is eyeing credit growth of 6-7 per cent this fiscal in line with the industry.
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