The company has posted sharp 91% decline in the disbursement in Q1FY2021. Meanwhile, the margins and asset quality of the bank was stable on sequential basis in Q1FY2021.

The net interest margin rose to 2.66% in the quarter ended June 2020, compared with 2.61% in the preceding quarter, while decline from 3.14% in the corresponding quarter last year.

Net interest income for the quarter ended June 2020 declined 22% to Rs 488.00 crore as against Rs 625 crore in the same period of the previous year.

Income from operations declined 9% to Rs 1801.52 crore in the quarter ended June 2020. Interest expenses also fell 10% to Rs 1363.53 crore, while other expenses (including staff cost of Rs 61.00 crore and other expenses of Rs 27.24 crore) dipped 30% to Rs 88.24 crore. Ensuing Gross profit declined 29% to Rs 420.56 crore.

The depreciation declined to Rs 15.99 crore in Q1FY2021 against Rs 16.39 crore in Q1FY2020. The provision and write offs stood at Rs 75.09 crore against Rs 164.16 crore in same quarter last year. PBT declined 20% to Rs 329.48 crore.

Effective tax rate eased to 21.94% bps on yoy basis from 31.29% . The profit after tax of the company declined 10% to Rs 257.18 crore in the quarter ended June 2020.

The Spread on loans for Q1FY2021 stood at 2.19% compared to 2.53% for Q1FY2020. The Company has not done any securitization during the quarter. Excluding the assignment income generated in Q1 FY2019-20, i.e. on the IGAAP basis, the Spread for Q1FY2021 is 2.28% compared to 1.98% in Q1 FY2019-20, an increase of 30 basis points.

Net Interest Margin for Q1FY2021 stood at 2.66% compared to 3.14% for Q1FY2020 declined owing to nil securitization during Q1FY2021 compared to Rs 2,318 crore during Q1FY2020.

Gross Margin, net of acquisition cost, for Q1FY2021 stood at 2.61% compared to 3.44% for Q1FY2020 due to lower fee and other operating income and nil securitization during Q1FY2021.

Loan book and disbursements

The AUM of the company fell 5% to Rs 83495 crore end June 2020 over June 2019. The loan portfolio of the company declined 10% to Rs 68009 crore, while the loans sold outstanding increased 25% to Rs 15486 crore end June 2020 over June 2019.

The share of Retail Loans being 82% and Corporate loans being 18% of the AUM down from 20% end June 2019.

The disbursements stood at Rs 694 crore during Q1FY2021 compared to Rs 7,634 crore during Q1FY2020. The lower disbursements were due to the impact of lockdown and economic slowdown. The disbursements, however, registered an increase on a month on month basis. Retail disbursements were at Rs 674 crore and Corporate disbursements at Rs 20 crore during Q1FY2021.

Borrowings and deposits

Total borrowings are at Rs 67,283 crore end June 2020 from Rs 72,261 crore end June 2019 registering a decline of 7% during the period.

The deposits with the company have increased 5% to Rs 16203 crore at end June 2020.

Asset quality

Gross NPA ratio was steady at 2.76% at end June 2020 from 2.75% a quarter ago, while moved up from 0.85% a year ago. Meanwhile, Net NPA ratio eased to 1.67% at end June 2020 from 1.75% a quarter ago.

In absolute terms, GNPA stood at Rs 1878.87 crore and NNPA at Rs 1133.30 crore at end June 2020.

Gross Non-Performing Assets (NPA) at an AUM level is at 2.32% and 2.76% at Loan Assets end June 2020. Retail book GNPA stood at 1.29% and Corporate book GNPA stood at 8.05% end June 2020

Moratorium

On 27 March 2020, in order to mitigate the burden of debt servicing and provide relief to borrowers, Reserve Bank of India announced moratorium on loans for three months from March 2020 to May 2020 (Phase 1). This was further extended by another three months upto August 2020 (Phase 2). Company adopted Opt-in route for accepting customer requests for moratorium.

As on 30 June 2020, approx 39% of Company's AUM have opted for moratorium which has reduced substantially from 56% in Phase 1. Retail Loans under moratorium account for 29% of the Retail AUM which has also reduced from 49% in Phase 1.

Distribution and Service Network

As a part of cost rationalization, the Company has merged two branches with other branches. As a result, end June 2020 the Company has 103 branches with presence in 64 unique cities and 23 Hubs.

The Company also services the customers through 27 outreach locations.

Capital to Risk Asset Ratio (CRAR)

The Company's CRAR based on IGAAP stood at 18.05% as on 30 June 2020, of which Tier I capital was 15.33% and Tier II capital was 2.72% compared to 15.13% with Tier I at 12.04% and Tier II at 3.09% as on 30 June 2019. The risk-weighted assets end June 2020 stood at Rs 50661.22 crore.

Credit Rating

As on 23 July 2020, PNB Housing Finance Fixed Deposit programme has been rated "FAA+" by CRISIL and "AA" by CARE. The Company's Commercial Paper (CP) is rated at "A1(+)" by CARE & CRISIL and Non-Convertible Debenture (NCD) are rated at "AA" by CARE, India Ratings, CRISIL and ICRA. Further the bank loans long term rating is "AA" by CARE and CRISIL.Book value of the company stood at Rs 490.8 per share, while adjusted book value was at Rs 423.4 per share at end June 2020.

Financial Performance FY2020:

For the year ended March 2020 (FY2020), PNB Housing Finance reported 13% rise in Income from operations at Rs 7688.21 crore. Interest expense moved up 14% to Rs 5874.95 crore, while other expenses declined 13% to Rs 486.37 crore. Ensuing Gross profit increased 9% to Rs 2128.23 crore. Depreciation increased 110% to Rs 65.85 crore, while provision and write offs increased 562% to Rs 1251.37 crore. PBT declined 53% to Rs 811.01 crore. Effective tax rate stood at 20.32% FY2020, compared with 31.30% in FY2019. The PAT of the company fell 46% to Rs 646.24 crore in FY2020.