PNB Sees Profit Plunge Amid Tax Regime Shift

Punjab National Bank (PNB) experienced a 48% drop in net profit to Rs 1,675 crore for the first quarter due to a switch to a new tax regime, which led to increased tax expenses. The bank's income and interest income rose, and asset quality improved with declining NPAs.

Punjab National Bank (PNB) reported a significant 48% decline in its standalone net profit for the first quarter, ending June, citing the transition to a new tax regime as a key factor in the increased tax expenses. The bank's net profit stood at Rs 1,675 crore, compared to Rs 3,252 crore in the same period last year.

Despite the fall in profit, PNB's total income rose to Rs 37,232 crore from Rs 32,166 crore, with interest income increasing to Rs 31,964 crore. The bank's operating profit achieved a new high of Rs 7,081 crore. However, the transition to the new tax system resulted in tax expenses more than doubling to Rs 5,083 crore.

Asset quality showed significant improvement with gross non-performing assets (NPAs) dropping to 3.78%, and net NPAs falling to 0.38%. The bank also saw a substantial reduction in provisions for bad loans, positioning itself for improved financial health in future quarters.

(With inputs from agencies.)