PNB Housing Fin Q1 net profit falls 10 pc to Rs 257 cr on lower disbursements

Retail disbursements were at Rs 674 crore and corporate disbursements at Rs 20 crore during the quarter under review," it said. Total borrowings stood at Rs 67,283 crore as on June 30, 2020 compared to Rs 72,261 crore a year ago, registering a decline of 7 per cent.

PNB Housing Finance on Thursday reported 10 per cent decline in consolidated net profit to Rs 257.2 crore in the first quarter ended June 30, mainly due to lower disbursement amid COVID-19 pandemic. The housing financier, promoted by Punjab National Bank, had reported net profit of Rs 284.5 crore in June quarter of 2019-20.

The company's net interest income also slipped 22 per cent to Rs 487.8 crore during April-June, as against Rs 625.5 crore in year-ago period, it said in a regulatory filing. Total income during the quarter fell to Rs 1,872.33 crore from Rs 2,232.58 crore.

"During the quarter, the COVID-19 pandemic had a significant impact on the disbursements, resulting in the lowest quarterly disbursements in more than 24 quarters. However, with all our branches now operational, we are witnessing an increasing trend in disbursement on a month-on-month basis," Neeraj Vyas, Managing Director & CEO, PNB Housing Finance, said. On the asset quality side, the company said its gross non-performing assets (NPA) at AUM level was 2.32 per cent, while 2.76 per cent at loan assets level in the first quarter. Net NPA stood at 1.67 per cent of the loan assets against 0.67 per cent a year ago.

PNB Housing witnessed sharp decline in its disbursements during the quarter to Rs 694 crore, compared to Rs 7,634 crore in year-ago period. "The lower disbursements were due to the impact of lockdown and economic slowdown. The disbursements, however, registered an increase on a month-on-month basis. Retail disbursements were at Rs 674 crore and corporate disbursements at Rs 20 crore during the quarter under review," it said.

Total borrowings stood at Rs 67,283 crore as on June 30, 2020 compared to Rs 72,261 crore a year ago, registering a decline of 7 per cent. However, the deposit portfolio grew by 5 per cent to Rs 16,203 crore during the quarter on higher retail penetration. It was Rs 15,446 crore during the same period last year, PNB Housing said.

Its total assigned loans outstanding as on June 30, 2020 was Rs 15,486. The housing finance company said capital to risk weighted assets ratio (CRAR) stood at 18.05 per cent as on June 30, 2020, of which Tier I capital was 15.33 per cent and Tier II capital was 2.72 per cent.

"The company has rolled out its business plan for the 2020-21 and will continue to focus on the lower risk weighted retail assets, resulting in higher percentage of retail book in the total AUM," Vyas said. As part of cost rationalisation, the company has merged two branches during the quarter and will merge more over next few months, he said.

"During the year, the company will continue its focus on recovery, liquidity, sell down of the corporate book, cost rationalisation and strengthen its balance sheet by further reduction in gearing," he added. The company's loan assets de-grew by 10 per cent year-on-year to Rs 68,009 crore by June-end, as against Rs 75,933 crore a year ago.

Assets under Management (AUM) stood at Rs 83,495 crore, down from Rs 88,333 crore, registering a decline of 5 per cent, with share of retail and corporate loan at 82 per cent and 18 per cent, respectively. The share of corporate loan has come down from 20 per cent during the quarter as part of PNB Housing Finance's concerted effort to sell down its corporate book.

On moratorium being provided to customers as per the RBI guidelines, the company said it fell to nearly 39 per cent of the AUM by the end of June quarter as against 56 per cent during phase 1 of the lockdown. Retail loans under moratorium account for 29 per cent of the retail AUM, compared to 49 per cent in phase 1.

On March 27, in order to mitigate the burden of debt servicing and provide relief to borrowers, the RBI had announced moratorium on loans for three months from March 2020 to May 2020. This was further extended by another three months up to August 2020. Stock of PNB Housing Finance closed 4.99 per cent higher at Rs 210.25 on the BSE.