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W h NIM i d f h i h i
Punjab National Bank
We expect the to remain under pressure from what was seen in the previous quarter on
account of lower growth in advances in Q1FY12 and the bank has hardly increased lending rates in
the quarter in comparison to its deposit rates that it had increased earlier.
We expect CASA to remain under pressure as seen in the last couple of quarters. However, CASA in
absolute terms will grow, but CASA share will remain under pressure.
Slippages will be a cause of concern for the bank as it migrates to system recognition of NPA’s of
the loan book of less than Rs.1mn.
Return ratios of PNB continue to remain on the healthier side (in Q1FY12) with RoA at 1.2% &
RoAE at 20.9% even after taking the impact of higher pension liability. We expect the return ratios
to remain on the higher side.
Currently, the stock is available at a P/ABV of ~1.1x FY13E.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
W h NIM i d f h i h i
Punjab National Bank
We expect the to remain under pressure from what was seen in the previous quarter on
account of lower growth in advances in Q1FY12 and the bank has hardly increased lending rates in
the quarter in comparison to its deposit rates that it had increased earlier.
We expect CASA to remain under pressure as seen in the last couple of quarters. However, CASA in
absolute terms will grow, but CASA share will remain under pressure.
Slippages will be a cause of concern for the bank as it migrates to system recognition of NPA’s of
the loan book of less than Rs.1mn.
Return ratios of PNB continue to remain on the healthier side (in Q1FY12) with RoA at 1.2% &
RoAE at 20.9% even after taking the impact of higher pension liability. We expect the return ratios
to remain on the higher side.
Currently, the stock is available at a P/ABV of ~1.1x FY13E.
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