PNB sees retail loans rising 17-18% and MSME credit up 21% this quarter

what happened

According to ANI, reproduced by ru.tradingview.com, Punjab National Bank managing director and CEO Ashok Chandra expects core retail loan growth to reach 17-18% in the current quarter, while lending to micro, small and medium enterprises should rise roughly 21%. He linked the expected pickup to the festive season, which he said should lift borrowing.

Chandra said agricultural priority-sector lending should keep its momentum after growing 18%. He also forecast further gains in profit and a continued decline in gross and net bad loans, pointing to two years of steady expansion in growth, asset quality and earnings.

In the first two quarters of the financial year, the bank approved corporate loans worth 2.5 trillion rupees, against 4 trillion rupees in the whole previous year. PNB is swapping lower-yielding advances for higher-yielding ones, which keeps corporate loan-book growth near 10-11%. Domestic net interest margin rose by more than 10 basis points and global margin by 8 basis points.

why it matters

Two points matter for markets: credit demand in India remains firm, and the recent 25 basis point repo rate hike could add roughly 7 basis points to the bank's net interest margin. Lending and deposit rates will be reviewed by the bank's ALCO in coming months, while further RBI moves depend on inflation and growth trends.

market impact

Indian banks: strong loan growth and margins support the sector, while RBI rate decisions remain the key driver

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