REUTERS - State-run Punjab National Bank (PNB), the country's fourth-biggest lender by assets, reported a 2 percent rise in second-quarter profit that handily beat forecasts, as its bad loans ratio fell.
Net profit rose to 5.61 billion rupees ($9.44 million) in the quarter ended Sept 30 from 5.49 billion rupees a year earlier, beating the 4.33 billion rupees average estimate of analysts, according to Thomson Reuters data.
Gross bad loans as a percentage of total loans stood at 13.31 percent at end-September compared with 13.66 percent at end-June and 13.63 percent a year earlier, the bank said on Friday. (http://bit.ly/2h9nRzR)
Provisions for non-performing assets rose 64 percent to 26.94 billion rupees.
State-run lenders account for the bulk of Indian banks' record 9.5 trillion-rupee soured loan pile as of June. The surge in bad loans has choked new lending in an economy which needs revival in investment to help spur growth.
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The Indian government, which owns majority stakes in 21 lenders including PNB, last month announced a $32 billion recapitalisation plan for the banks to help them resolve soured loans and kickstart lending which last year grew at its slowest pace in more than six decades.
Shares of the bank were trading about 4 percent higher at 205.7 rupees at 0713 GMT in a Mumbai market that was up 0.18 percent. PNB shares have surged 43 percent since the recapitalisation plan was announced on Oct 24.
($1 = 64.5950 Indian rupees)
(Reporting by Samantha Kareen Nair in Bengaluru and Mohi Narayan in New Delhi; Editing by Sunil Nair and Muralikumar Anantharaman)
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