Finance Minister Arun Jaitley on Tuesday came in support of scam-hit Punjab National Bank (PNB) and asserted that the bank, like the Indian economy, has sound fundamentals and strong growth potential.
These position PNB for sustained good performance and, going forward, generating positive market sentiment and market capitalisation gains, Jaitley said in a written reply to a Rajya Sabha question on the recent fraud at PNB.
Jaitley’s remarks will come as some comfort for the PNB senior management, which has been facing rough weather ever since the ₹12,700-crore scam perpetrated by fugitive diamantaire Nirav Modicame to light.
To buttress his stance that PNB has strong growth potential, Jaitley noted that the public sector bank had a high share of current account and savings account (CASA) deposits, healthy provision-coverage ratio of over 60 per cent and high potential for mobilising capital through sale of non-core assets.
Jaitley highlighted that market capitalisation depends on underlying fundamentals, growth potential and general market sentiments.
Ever since the Nirav Modi fraud on PNB came to light, PNB’s share price has been coming down at the bourses.
Between February 14 and February 26, the PNB share price was down 23.25 per cent, the reply noted.