Punjab National Bank (PNB) will report its financial results on Thursday. The public sector lender is likely to take a hit on profitability due to a treasury loss

— or a loss emanating from a fall in bond prices. Investors will closely look out for a stable margin and signs of sustained improvement in asset quality.

Analysts in a CNBC-TV18 poll expect PNB's net profit for the April-June period to come in at Rs 736.3 crore, which would mean a 28.1 percent fall compared with the previous three months.

They estimate the PSU bank's net interest income (NII) — or the difference between interest earned and interest paid — at Rs 7,534.1 crore for the three-month period. That would translate to an increase of 4.3 percent compared with the quarter ended March.

The analysts peg the bank's loan growth — a key metric of demand for lenders — to come in at two percent sequentially.

PNB's asset quality — measured by the proportion of bad loans in total loans — is expected to improve.

Punjab National Bank's financial results come in a tightening monetary policy environment, with major central banks having lined up aggressive hikes in COVID-era interest rates.

The RBI has raised the repo rate — or the key rate at which it lends funds to commercial banks — by 90 basis points since early May. Its Monetary Policy Committee — or the rate-deciding panel chaired by the RBI Governor — is scheduled to meet next week.

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First Published:Jul 28, 2022 1:16 PM IST