The bank’s chief executive, Swarup Kumar Saha, told ET that the lender has got approval to scale up the business size to ₹4 lakh crore and is going through a digital transformation project which will materialise by the year-end, enabling the bank to undertake more digital lending and acquisition of accounts.
“We are upgrading our technology. We are upgrading our credit underwritings. I think the bank is well-poised to be on a sustainable and efficient growth path,” he said.
The bank posted a profit of ₹331 crore for the first quarter of the fiscal, up 23.05% from ₹269 crore a year ago. Operating profit, however, remained almost flat at ₹545 crore in the April-June period, against ₹540 crore a year earlier.
“We are trying to have more operating income or operating profit from our core business, so that is the green shoot in the overall assessment, and our net interest income (NII) growth, which is at over 15%, shows that we have also now been able to stabilise our interest components of both deposits and advances,” Saha said.
Punjab & Sind Bank has identified food and agro as the champion sector, largely because of its presence in the northern part of the country, he said, adding, “We have created special segments within the retail, within MSMEs (micro, small and medium enterprises), so that we get better returns from those assets, much more than what we get in a corporate lending.”
Saha said the bank is constrained by not having any branches abroad and has kept a modest target of $100 million under the Reserve Bank of India (RBI) swap facility schemes, of which $25 million will be raised from foreign currency non-resident (bank) deposits and the remaining through external commercial borrowings and overseas foreign currency borrowings swap initiatives.
In terms of recovery, the lender aims to increase its collection efficiency to 98% from 95% and has become proactive in auctioning properties, which is giving it good recovery. The target for this fiscal is ₹1,000 crore. “We have done ₹366 crore this year, and I think we will surpass that guidance that we have given,” said Saha.