PNB Housing Finance to strengthen its recovery efforts this month onwards

The PNB Housing Finance is likely to step up its recovery efforts and manage the bad loans from this month onwards. The deadline of leniency shown to the borrowers by the courts ends on August 31. The organisation will ask the borrowers to do the repayment of loans if there are capable to do so.

PNB Housing’s gross non-performing assets (NPAs) increased to 6% of the gross advances (or Rs 3,625 crore) in the quarter ended June 30, 2021, from 2.7% by the end of June 2020, due to the second wave of the pandemic.  The increase in NPAs is also due to the legal forbearance up to August 31, 2021, as per high court orders.

Due to the Covid situation, various courts and high courts had directed lenders not to take any legal or administrative action against defaulters.

“We expect to manage these better from this month onwards even as we have managed to pull back some NPAs. We have pulled back about Rs 80 crore of NPA in July itself,” Hardayal Prasad, managing director and CEO of PNB Housing Finance, told media recently.

For someone who has borrowed money from the company, the company will ask the person to return it unless there is a demise in a family, or someone’s business is wiped out.

“But, if you have borrowed, your business is running. I have every right to ask for my money,” Prasad said.

The company will show consideration on a case-to-case basis. If there are genuine borrowers facing any kind of problem to repay, the company will find a solution in such cases.

On June 30, 2021, its Covid-related restructured loans stood at Rs 1,733 crore.

It posted a 5% fall in its net profit to Rs 243 crore in the first quarter ended June 2021, as against Rs 257 crore in the year-ago quarter.

The company, promoted by Punjab National Bank, said its collection efficiency was the lowest in May due to the second wave of the pandemic. In June and July, it witnessed an uptick.