NPA recovery boost: PNB targets overall recovery of ₹ 32,000 crore this fiscal | Popgen Tech
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Punjab National Bank (PNB) aims to make an overall recovery of ₹ 32,000 crore this fiscal and is stepping up efforts to curb net non-performing assets (Net NPA) as a percentage of its advances to 3.5 in -percent by the end of March 2023 from about 4.3 percent now, said its MD & CEO Atul Kumar Goel.
Overall recovery, which would include cash recovery, improvement and recovery from written off accounts, is now an “area of focus” for the bank and a team of 300 officers has now been finally brought together week of June to increase attention on this front. , Goel said, adding that he was confident of achieving a net NPA of 3.5 percent by the end of March 2023.
“We are focusing on recovery through One time settlement (OTS), taking physical possession and we are also using technology. Every account is being monitored. A team of 300 people was put to work. There is no worry on any large account”, he added.
He also emphasized that the recovery of cash from canceled accounts was higher in the last quarter of June than the previous three months of March or even the June quarter of last year.
As on day PNB, the country’s second largest public sector bank, has an NPA of ₹ 90,000 crore besides technically written off (TWO) of ₹ 90,000 crore. Put together, the total bad debt position was around ₹ 1.8-lakh crore. The public sector bank is eyeing a recovery of around ₹ 8,000 crore every quarter this fiscal.
Q1 net decrease
On Thursday PNB had reported a 72 percent decline in consolidated net profit for the first quarter ended June 30, 2022 at ₹ 304 crore (₹ 1,080 crore).
Goel said the bottom line performance was weighed down by ₹ 1,400 crore marked for market success due to the increase in returns on G-secs, besides the fact that the total treasury gains made by the bank in -quarter also dropped by around ₹ 500 crore. .
NCLT Recovery
Goel said PNB was aiming to recover ₹6,506 crore this fiscal through the National Company Law Tribunal (NCLT) route. As on date, there are 622 cases before NCLT with outstanding loans of ₹66,846 crore, of which the bank has provided for ₹65,384 crore.
He said the bank had recovered ₹ 693 crore through the NCLT route in Q1 this fiscal and expects to recover ₹ 626 crore in Q2; ₹ 1,799 crore in Q3 and ₹ 3,386 crore in Q4.
Transfer to wrong bank
PNB is aiming to transfer non-performing assets (NPAs) worth ₹ 2,486 crore to the newly created National Asset Reconstruction Company Ltd (NARCL) – commonly called a bad bank – by the end of September in the first phase.
“As of date, nothing has been transferred from any bank. We hope that by September all banks will be in a position to transfer. On our part, we have identified eight assets amounting to ₹ 2,486 crore to be transferred to NARCL soon. By the end of this quarter, I hope that the transaction will take place”, said Goel. The PNB has already made 100 percent provisions for this bad loan that should be transferred to the bad bank.
Goel, who is also President of the Indian Banks Association (IBA), expects at least ₹ 50,000 crore of NPAs from the banking system to be transferred to the bad bank that has just been set up this fiscal.
