CEO Ashok Chandra says credit growth guidance will be surpassed despite global risks
State-owned Punjab National Bank reported a 214 per cent rise in net profit to Rs 5,253 crore in the April-June quarter (Q1) of the fiscal year 2026-27 compared to Rs 1,675 crore in Q1 FY26. In an interview, the Bank’s MD and CEO, Ashok Chandra, speaks to Falaknaaz Syed about the impact of El Niño, West Asia conflict, business plans and inflows under FCNR (B).
What will be the impact of monsoon and West Asia conflict on your business? Any change in guidance?
As of now, the Middle East crisis has no impact on any of the sectors and any geography and it is getting reflected in my stressed book, and slippages (which remain low). I can tell you very confidently that the Indian economy is very, very resilient. Banks are able to take care of the domestic requirement and because of that only, you are seeing high growth for the system. Not only PNB, I mean all the banks have shown good credit growth and that growth is continuing in this quarter also.
Secondly, on the El Niño factor. I think let us wait for another two months because last year also the monsoon was delayed but revived in August and September. So, I am optimistic for this year too. However, if monsoon doesn’t regain strength then definitely some challenge will come on the agri (loan) book in the third quarter onwards.
So no change in guidance on credit, deposit growth?
Credit growth, we have given a guidance of 12-13 per cent and definitely we will cross this guidance. Deposit growth guidance is 9-10 per cent. Also on operating profit, whatever guidance we have given, we are not going to miss any of the guidance.
How much have you mobilised under FCNR (B) deposits and what is the target?
So far we have mobilised $ 425 million through FCNR (B) deposits while the target is $ 2.5 billion by September 30.
Globally bond yields have risen affecting FCNR inflows. Will you be able to meet the target? Also what kind of flows may come in the banking system?
We have an old association with many foreign banks under the correspondent banking arrangements which will help us in getting foreign funds. And in the beginning itself when the scheme was launched, I had mentioned that our bank will mobilise $ 2.5 billion while the country should get around $ 35-40 billion through the FCNR route. I think that amount will come into the system. Just wait for another one or two months.
What is the leverage you are providing?
Leverage will be given on a case to case basis. But we are not giving more than 9 times.
What is the credit growth you will see in various segments?
Corporate loan book will grow at 10 per cent. Growth has been well diversified coming from renewable energy, infrastructure, roads, power, agriculture trading, warehouse, real estate, natural engineering, all major sectors are witnessing good growth.
For MSME, we are growing at 20-21 per cent and that growth will continue throughout the year. Retail, we are growing at 14-15 per cent which will also continue. Agriculture, priority sector too will grow at 16-17 per cent.
Any plans to monetise stake in any subsidiaries?
As of now, there are no monetization plans for the next quarter.
Has MetLife evinced interest in increasing stake in your insurance venture PNB MetLife after 100 per cent FDI has been allowed?
No, we are not going to dilute our stake in the insurance joint venture.
