Taken loan from PNB? You may have to pay higher EMIs from next month, check details

PNB will raise the repo-linked lending rates from next month. 

Taken loan from PNB? You may have to pay higher EMIs from next month, check details

New Delhi: Punjab National Bank (PNB) chief Atul Kumar Goel on Thursday said the bank will raise the repo-linked lending rates from next month. The move comes against the backdrop of Reserve Bank of India (RBI) hiking the repo rate by 40 basis points (bps) last week amid rising inflation.

Goel, the state-owned lender's MD and CEO, told reporters that interest rates are certain to rise a tad going further.

"With 40 bps rise in repo rate... So according to our policy, from June 1, the same quantum raise in lending rates will be there. So there will be some increase in the loan rate for sure," Goel said.

Repo rate is the rate at which banks borrow short term money from RBI.

With effect from May 7, the city-headquartered lender had raised interest rates on term deposits in select buckets up to 0.60 per cent.

A number of banks have already raise the repo-linked lending rates for their customers after the RBI rate hike. Some have also increased their deposit rates.

About the bank's performance in the quarter and fiscal ended March 2022, Goel said the quarterly profitability reduced due to an increase in provisioning.

In the March quarter, the bank's net profit fell 66 per cent to Rs 202 crore. However, for the full year 2021-22, the net profit jumped 71 per cent to Rs 3,457 crore.

Goel said the demand in the economy has reached the pre-pandemic level and sectors such as steel, cement and road infrastructure are showing good trends.

"There is a good demand in the vehicle segment. On account of COVID, everybody wants to purchase own vehicle. It is the reason that there was growth of about 25 per cent in the vehicle (segment loans). There is a good demand in the housing sector also. We are also estimating 15 per cent growth in the housing loan demand.

"As I told you earlier also, there is a good demand in the steel, cement industries... Lot of road projects are coming. We have very hopeful, this year will be very good as far as the credit growth is concerned," he said.

On the asset quality front, the lender registered an improvement with the Gross Non-Performing Assets (GNPAs) falling to 11.78 per cent of the gross advances as of March 2022 from 14.12 per cent a year ago.

Net NPAs or bad loans too declined to 4.8 per cent from 5.73 per cent. However, the lender kept a higher provision for bad loans and contingencies for Q4 FY22 at Rs 4,851.47 crore, as against Rs 3,540.32 crore earlier.

However, the provision and contingencies for the latest March quarter was raised to Rs 4,851.47 crore as against Rs 3,540.32 crore in the same quarter a year ago. Also Read: 3 free LPG cylinders for Antyodaya card-holders! Uttarakhand govt takes big step ahead of crucial by-poll

"As far as NPA addition is concerned, in whole year FY2021, it was Rs 28,100 crore which has reduced to Rs 24,744 crore (in FY22). In terms of quarterly addition, it was Rs 10,506 crore in March 2022 quarter," Goel added. Also Read: Why Terra Luna crashed 98% in a snap? Massive crypto fall signals worrying signs

Live Tv

Trending news