Assets Under Management AUM

PNB Housing aims to bring the business loan portfolio below 10,000 by the end of March 2022

The company’s business loans amounted to ??10,989 crore at the end of the first quarter 2021-2022, representing 15% of its assets under management (AUM) and the latter touched ??71,828 crore over the same period.

However, PNB Housing Finance’s loan assets declined to ??60,438 crore at the end of June this year compared to ??68,009 crore in the period of one year ago.

The business of the company, promoted by the public enterprise Punjab National Bank (PNB), has been affected by the second wave of COVID.

“This quarter (June 2021) itself, we were able to reduce the book by about ??800 crore in terms of business (loan). And we wanna take it back down ??10,000 crore (by March 2022), “Hardayal Prasad, managing director and CEO of PNB Housing Finance, told PTI in an interview.

The company has reduced its portfolio by 25% since March 2020.

At some point, the company would like to make a decision on the size of business loans, Prasad said, adding that it was essential to have some financing from the builder.

“This (business book) was about ??11,800 crores (by the end of fiscal 21). Now it comes to ??10,900-10,800 crores. So we definitely aim to bring it down below ??10,000 crores and in the future we will see what kind of wallet we would like to hold and what kind to let go, ”said Prasad.

He said the company has taken a massive initiative for its retail ledger and is focusing on granular ledger resulting in a higher proportion of less than ??2 crore loans.

In January, the company rolled out a strategy to expand its retail portfolio.

“So we continue to monitor the deliverables that we have promised. And in that strategy, we made it very clear that we would go for a retail-oriented organization,” said Prasad.

According to PNB Housing Finance, retail will be its growth engine and it will take advantage of expertise in mass housing and the merchant category.

In the affordable housing segment, the lender will develop its “Unnati” portfolio, focusing on the average size of banknotes. ??15 lakh. It will also strengthen the distribution network with an increased presence in level II and III cities.

PNB Housing Finance recorded a net profit of 5% at ??243 crore in the last quarter of June.

Noting that the company has done “a reasonably good job,” Prasad said net profit has jumped almost 90% sequentially.

“There’s a marginal drop if you look year over year (earnings). But you have to take into account that we actually have a wallet that’s running out, that’s a part. (book), and we will only reduce operations on the corporate side, which we have done significantly.

“So if you look at the profit, I think it’s reasonably good,” he added.

Almost 45 days of lockdown during the April to June period of this fiscal year due to the second wave of COVID and legal instructions have hampered the company’s operations as well as the recovery process, Prasad said. while adding that the efficiency of the collection has now improved.

In July, the efficiency of the collection went from 95% to almost 98%.

“During the quarter there were 45 days of lockdown so there was virtually no activity during that period. We plan to better manage them starting this month as we were successful in withdraw some postcode. We have moved back by about ??NPA 80 crore in July itself, ”said Prasad.

In addition, the company has launched the ‘IGNITE’ project which aims to increase efficiency by reducing costs.

“This project has completed its diagnostic study. To bring this project to fruition, we brought in a proven transformational leader. He is leading this IGNITE project, which will actually take care of almost everything.

“This is going to help us tremendously in the way we are going to do our business, because once we have a very, very good IT infrastructure and strong digital products, we can increase the numbers very quickly,” said Prasad.

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