Punjab National Bank will focus on improving credit offtake in its retail and MSME segments as it expects these sectors to drive the loan growth in the current financial year.
First of all, the bank will keep its focus on diversified credit growth as it is expected that the huge demand will erupt from the MSME and retail segments in FY23. With the expected pick-up in the credit growth, interest income may also see an uptick,” the bank said in its annual report for FY22.
The bank’s retail credit grew 6.7% year-on-year to Rs 1.3 trillion in Q4FY22 while MSME advances rose 1% to Rs 1.2 trillion.
The bank will also focus on improving its current account, savings account (CASA) ratio for higher profitability. It is planning to scale up collaborations and partnerships for better results. Domestic CASA share improved by 195 bps on year to 47.43% in Q4FY22.
Asset quality will continue to be the buzzword for us and the bank will take up action-oriented plans to keep NPAs low so that capital remains available for business growth,” PNB said. The bank will lay stress on credit monitoring through proactive steps on the basis of various early warning signals and address the stress upfront.
As on March 31, 2022, the gross NPA ratio improved by 234 bps to 11.78% while the net NPA ratio improved by 93 bps and stood at 4.80%.
The bank is planning to strengthen the PNB ONE app by offering digital lending, marketplace features, lifestyle offerings and wealth management services by revamping existing features.
The bank will also make efforts towards profit maximisation through increase in non-fund-based business and income from third party products and will rationalise branches and ATMs to cut costs.