Banks with lower NPA percentages are perceived as more stable and credible. They have a more robust loan portfolio and a reduced risk of default, both of which are crucial for financial stability.
A lower NPA ratio, on the other hand, does not always mean that a bank is fully risk-free. Market circumstances, economic slowdowns, and changes in government laws can all have an impact on a bank’s financial health.
Non-performing assets (NPA): a loan or advance for which the principal or interest payment has remained overdue for a period of time, usually 90 days or more.
The banks listed below lowered their NPA by up to 3.17% in Q1FY24 compared to Q1FY23.
Punjab National Bank
On Wednesday, the shares of Punjab National Bank were trading at Rs 61.00 a share, down 1.85 percent from the previous close price of Rs 62.15.
According to a recent report, Punjab National Bank’s NPA has decreased by 2.3 percent, from 4.28 percent in Q1 FY23 to 1.98 percent in Q1 FY24.
The company reported a net profit of Rs 1,210 crore for the April-June quarter, up 298 percent from Rs 304 crore reported in the corresponding period last year. Revenue from operations for the June 2023 quarter grew 34 percent YoY to Rs 25,672 crore as compared to Rs 19,143 crore in the year-ago period.
Punjab National Bank offers a variety of services to its customers, including business and personal banking, industrial financing, agricultural finance, and international finance.
South Indian Bank Ltd
South Indian Bank’s shares were trading at Rs 20.15 on Wednesday, down 0.74 percent from the previous close price of 20.35.
South Indian Bank reported a 1.02 percent decline in NPA, from 2.87 percent in Q1FY23 to 1.85 percent in Q1FY24.
The company reported a net profit of Rs 202 crore for the April-June quarter, up 75 percent from Rs 115 crore in the previous year’s corresponding quarter. In comparison, revenue from operations increased by 25 percent year on year to Rs 2,025 crore in the June 2023 quarter, up from Rs 1,621 crore the previous year.
South Indian Bank provides retail and corporate banking, para banking activities such as debit cards, third-party financial product distribution, and Foreign Exchange Business.
Yes Bank Ltd
Yes Bank Ltd shares were trading at Rs 16.85 a share on Wednesday, with the bank having a market capitalization of Rs 48,453 crore.
According to the most recent data, bank NPA fell by 3.17 percent, from 4.17 percent in Q1FY23 to 1.00 percent in Q1FY24.
The company posted a net profit of Rs 346 crore for the April-June quarter, up 10 percent from Rs 314 crore the previous year. Revenue from operations increased by 25 percent year on year to Rs 6,445 crore in the June 2023 quarter, up from Rs 5,134 crore the previous year.
Yes Bank Ltd is engaged in providing a wide range of banking and financial services such as capital finance, trade and transactional services, treasury risk management services, investment banking solutions, and liquidity management solutions.
Written by Omkar Chitnis
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