Punjab National Bank Q2 Results: A Detailed Analysis

Punjab National Bank (PNB) has announced its Q2 results for the fiscal year 2026, reporting a 14% year-on-year increase in its net profit. The bank’s net profit stood at Rs 4,903 crore, up from Rs 4,303 crore in the same quarter last year.

Key Highlights of PNB’s Q2 Results

The bank’s net interest income (NII) was nearly unchanged at Rs 10,469 crore, down 1% sequentially. However, provisions surged 123% year-on-year to Rs 643 crore. Other income declined 5% to Rs 4,342 crore.

The state-run lender’s gross non-performing asset (NPA) ratio improved to 3.45% from 3.78% in the prior quarter, and net NPA eased to 0.36% from 0.38%. Domestic net interest margin contracted 12 basis points sequentially to 2.72%.

Domestic advances rose 10.5% year-on-year to Rs 10.11 lakh crore, and deposits increased 10.4% to Rs 14.16 lakh crore. The slippages fell to 0.71%, down 18 basis points year-on-year.

Operating Profit and Return on Assets

The operating profit for Q2 FY26 increased to Rs 7,227 crore, recording a growth of 5.5% on a year-on-year basis. The return on assets (RoA) improved to 1.05% in Q2 FY26 from 1.02% in Q2 FY25.

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Net Interest Income and Net Interest Margin

Net interest income (NII) increased to Rs 21,047 crore in HY1FY26 from Rs 20,993 crore in HY1FY25, showing an improvement of 0.26% on a year-on-year basis. The global net interest margin (NIM) stands at 2.65% in HY1FY26 and 2.60% in Q2 FY26.

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Asset Quality and Provision Coverage Ratio

The GNPA ratio improved by 103 bps on a year-on-year basis to 3.45% as on September 25 from 4.48% as on September 24. The NNPA ratio improved by 10 bps on a year-on-year basis to 0.36% as on September 25 from 0.46% as on September 24.

The provision coverage ratio (including TWO) improved by 24 bps on a year-on-year basis to 96.91% as on September 25 from 96.67% as on September 24.

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Global Business and Deposits

Global business grew by 10.6% on a year-on-year basis to Rs 27,86,673 crore as on September 25 from Rs 25,20,246 crore as on September 24. Global deposits registered a growth of 10.9% on a year-on-year basis to Rs 16,17,080 crore as on September 25 from Rs 14,58,342 crore as on September 24.

Global advances increased by 10.1% on a year-on-year basis to Rs 11,69,592 crore as on September 25 from Rs 10,61,904 crore as on September 24. RAM advances grew by 12.7% on a year-on-year basis to Rs 6,35,417 crore as on September 25 from Rs 5,64,049 crore as on September 24.

CD Ratio and CRAR

The CD ratio improved by 124 bps to reach 72.33% in Q2 FY26 as against 71.09% in Q1 FY26. The CRAR increased to 17.19% as on September 25 from 16.36% as on September 24, registering an improvement of 83 bps.

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Conclusion

In conclusion, Punjab National Bank’s Q2 results have shown a significant improvement in its asset quality and a surge in provisions. The bank’s net profit has increased by 14% year-on-year, driven by a growth in domestic advances and deposits.

However, the bank’s net interest income has remained nearly unchanged, and other income has declined. The bank’s gross NPA ratio has improved, and the net NPA has eased.

Overall, PNB’s Q2 results are a positive sign for the bank and the Indian stock market. The bank’s focus on improving its asset quality and increasing its provisions is expected to yield positive results in the long term.

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