Key Points of PNB AT1 Bond Issue to Raise Funds:
- PNB will hold a board of directors meeting on March 29, 2023, to consider a proposal to raise funds for FY 2023-24.
- The bank plans to raise capital by issuing Basel-III compliant AT1 Bonds and Tier-II Bonds in one or more tranches.
- The issuance of AT1 bonds aims to improve PNB’s core capital base.
- PNB’s standalone net profit for Q3 FY23 decreased by 44% to INR 629 crore due to increased provisioning for bad loans.
- PNB’s provisions for bad loans increased to INR 3,908 crore during the quarter from INR 3,654 crore a year earlier.
- Despite an increase in net interest income and operating profit, PNB’s shares have fallen by over 18% in 2023 (year-to-date or YTD) compared to the benchmark BSE Sensex’s 5% decline in the same period.
- PNB’s asset quality improved with gross non-performing assets (NPAs) declining to 9.76% from 12.88% YoY.
Details of PNB AT1 Bond Issue to Raise Funds:
State-run Punjab National Bank (PNB) has announced that its board of directors will hold a meeting on March 29, 2023, to review the proposal of fund raising for FY 2023-24 through the issuance of Basel-Ill compliant Additional Tier-1 (AT1) Bonds and Tier-II Bonds, in one or more tranches. The purpose of issuing AT1 bonds is to boost the bank’s core capital base. PNB disclosed this information in a filing to the exchange.
PNB’s standalone net profit for Q3 FY23 fell by 44% to INR 629 crore due to increased provisioning for bad loans. The bank earned a net profit of INR 1,127 crore in the same period the previous year. The provisions for bad loans increased to INR 3,908 crore during the quarter from INR 3,654 crore a year earlier.
Despite a year-on-year increase of 17.6% to INR 9,179 crore in net interest income (NII) and a 12.6% rise in operating profit to INR 5,716 crore, the bank’s shares have fallen by over 18% in 2023 (year-to-date or YTD), compared to the benchmark BSE Sensex’s 5% decline in the same period. Nevertheless, the bank’s asset quality improved, with gross non-performing assets (NPAs) declining to 9.76% from 12.88% YoY.
About PNB:
PNB, headquartered in New Delhi, is a public sector bank established in May 1894. With respect to business volumes, it is the third-largest public sector bank in India and second-largest in terms of network. The bank caters to over 180 million customers through a network of 12,248 branches and 13,000+ ATMs.
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