New Delhi, May 6, 2026, 20:32 IST
- Punjab National Bank posted a 14.4% jump in Q4 FY26 net profit to Rs 5,225 crore. The board also put forward a Rs 3-per-share dividend.
- The lender has now cleared Rs 1 lakh crore in digital sanctions and is eyeing a Rs 2 lakh crore digital book by FY27.
- Brokerages mostly kept a positive stance on the stock. Still, the numbers were muddied by margin pressure and softer net interest income, making for a less-than-straightforward result.
Punjab National Bank logged a 14.4% jump in net profit for the March quarter, posting Rs 5,225 crore. The state-run lender managed the profit growth despite a drop in core lending income. PNB’s board has also put forward a Rs 3 per equity share dividend for FY26, pending shareholder approval.
The timing’s key here: PNB wants investors to look past a weaker spread business and pay attention to loan growth, cleaner credit, and digital origination efforts. Net interest income, or NII—the gap between what it makes on loans and pays out for funds—slipped 3.5% from a year earlier to Rs 10,380 crore.
PNB shares traded at Rs 110.18, up 2.12% as of the 3:31 p.m. IST update from NSE/BSE. Earlier in the session, the stock had jumped close to 4% on the back of the results.
PNB’s Managing Director and CEO Ashok Chandra told The Economic Times that digital channels now make up “more than 95%” of the bank’s transactions. The lender is shooting for a Rs 2 lakh crore digital book by FY27. Chandra pointed to strong momentum coming in credit cards, cash management and supply-chain finance. The Economic Times
According to the bank’s presentation, digital transactions climbed to 337 crore in Q4 FY26, up from 277 crore the previous year. UPI transactions also moved higher—reaching 323 crore, compared with 267 crore. PNB reported that digital lending sanctions and disbursals topped Rs 20,872.83 crore for the quarter, spread across 476,976 accounts.
Global advances hit Rs 12.59 lakh crore, up 12.7% from a year earlier. Deposits climbed too, rising 9.2% to Rs 17.11 lakh crore. As for RAM advances—those to retail, agriculture, and MSME segments—these increased 12.1%, reaching Rs 6.76 lakh crore.
Asset quality gave some breathing room. Gross non-performing assets dropped to 2.95%, down from 3.19% last quarter; net NPAs edged lower to 0.29%. Provisions saw a sharp cut, sliding to Rs 424 crore versus Rs 1,150 crore previously.
PNB is projecting credit growth between 12% and 13% for FY27, with deposits expected to rise 9% to 10%. The bank’s guidance puts net interest margin in the 2.60%-2.70% range, and it’s targeting gross NPAs under 2.5%. For FY26, net interest margin came in at 2.57%.
For public-sector banks like State Bank of India, Bank of Baroda, and Canara Bank, it’s really all about funding costs right now. PNB’s loans are outpacing its deposit growth, which puts the margin target under pressure—especially if costly deposits persist. There isn’t much flexibility left for another margin hit.
Motilal Oswal tagged the quarter as mixed, noting that the earnings beat mainly came from lower provisions and tight control on operating costs, even as margins slipped 5 basis points sequentially. The brokerage stuck with its Buy rating and kept the target at Rs 135. Jefferies, meanwhile, maintained its Buy stance too, but clipped its target down to Rs 130 citing softer NII and persistent margin pressure.
Pushing deeper into digital comes with a price tag. PNB is allocating close to 20% of its tech spend—around Rs 7 billion to Rs 8 billion—for cybersecurity in this financial year, Executive Director D. Surendran told Reuters. “We don’t want to compromise on this kind of expenditure,” he said. Reuters
Still, there’s a catch: profits could end up relying heavily on reduced provisions and one-off cost reversals, especially if spread income remains under pressure. PNB’s plans for FY27 — margins, return on assets north of 1%, and robust loan growth — may hit a wall if deposit costs don’t come down quickly enough, despite improvements in asset quality and an expanding digital portfolio.
