New Delhi, May 5, 2026, 17:37 IST
- Punjab National Bank posted a March-quarter profit of ₹5,225 crore, though net interest income slipped 3.5%.
- Gross NPA ratio dipped under 3% as bad loans improved; the board put forward a dividend of ₹3 per share.
Punjab National Bank posted a 14.4% jump in fourth-quarter profit on Tuesday, crediting stricter cost controls and healthier asset quality. Still, the lender saw its core lending income slip, flagging ongoing margin pressure.
Net profit at the New Delhi-based state-run lender climbed to ₹5,225 crore for the January-March stretch, up from ₹4,567 crore last year. But net interest income slipped 3.5%, landing at ₹10,380 crore compared to ₹10,757 crore in the same period.
That’s the crux of it. PNB turned in a stronger profit on the surface, but pressure is building underneath—interest income isn’t keeping pace as lending rates ease off, while deposit costs refuse to budge. Domestic net interest margin slipped to 2.61% from last year’s 2.96%. Global NIM came down, too, at 2.47% versus 2.81% a year ago.
PNB reported a 10.7% jump in operating profit to ₹7,500 crore, even as total income slipped 1.1% to ₹36,319 crore. The board is pushing for a ₹3 dividend per equity share, pending shareholder nod.
Asset quality pulled more weight this time. Gross non-performing assets dropped to 2.95% of advances as of March 31, down from 3.95% a year ago; net NPA slipped to 0.29% from 0.40%, according to the bank’s press release. Provision coverage ratio climbed higher, reaching 97.14%.
The bank set aside ₹906 crore for NPA provisions in the quarter, up from ₹588 crore a year ago. Overall provisions, excluding tax, landed at ₹424 crore after factoring in offsets like write-backs on standard advances. Profit before tax rose by 10.3%, reaching ₹7,077 crore.
PNB posted a modest 1.6% increase in full-year profit at ₹16,904 crore, a figure that underscores how much of the momentum came in the March quarter. The bank reported global business up 10.7% to ₹29.70 lakh crore, with deposits climbing 9.2% and advances rising 12.7%.
The lender pushed deeper into retail, agriculture and MSME loans—what Indian banks group together as RAM. RAM loans climbed 12.1% to ₹6.76 lakh crore. Retail credit overall was up 8.3%. Vehicle loans surged, up 35.1%. MSME advances increased 19.9%.
PNB isn’t alone in feeling the pinch on margins. Union Bank of India saw its net interest income slip in the March quarter, with NIM dropping to 2.64% from 2.97% a year ago. Investors, already wary, are watching to see how public-sector banks like these handle narrowing spreads as rates trend lower.
Last year, Chief Executive Ashok Chandra told Reuters that PNB was targeting a gross NPA ratio below 3% by the close of FY26. That target’s now been hit, based on the latest data. At the time, he also flagged that central bank rate cuts usually take time to filter through, and warned that funding costs could remain high for a few more quarters.
There’s a risk here: margin repair could lag behind the bad-loan clean-up. Should deposit costs stay stubborn or loan yields keep drifting down, PNB might end up leaning harder on cost cuts, recoveries, and non-interest income just to keep profit growth on track.
Shares of PNB slipped 0.73% to ₹107.89 by 3:59 p.m. IST, Economic Times data showed, with the stock swinging between gains and losses after the results.
