Indian lender PNB has 70 billion rupees exposure to Adani Group -MD
MUMBAI (Reuters) - India's Punjab National Bank has a total exposure of 70 billion rupees ($859.30 million) to Adani Group, but there is currently no worry pertaining to those accounts, the state-run lender's managing director and chief executive said on Monday.
Last week, U.S. short-seller Hindenburg Research flagged concerns about Adani Group's debt levels and the use of tax havens. Adani Group has said that it complies with all local laws and has made the necessary regulatory disclosures.
"Out of 70 billion rupees, around 25 billion rupees is related to Adani's airport business," PNB CEO Atul Kumar Goel told reporters at a virtual press conference after the company's quarterly results.
"Whatever the exposure we are having is backed by cash flow."
However, the bank is keeping a "close eye" on the developments pertaining to the news flow around Hindenburg's research report, Goel said.
The bank has not given any loan to the Adani Group by pledging shares, he added.
Punjab National Bank reported a 44% drop in net profit for the October-December quarter due to rising provisions for bad loans.
The lender's asset quality improved, with gross non-performing asset ratio at 9.76% as of end-December, compared with 10.48% at the end of the prior quarter.
Its net NPA ratio was at 3.30% as of the end of December.
Goel said the bank is targeting a gross NPA ratio of around 9% and net NPA ratio of 3% by March-end. The bank is targeting credit growth of 12-13% and deposit growth of 8-9% for 2022-23. ($1 = 81.4620 Indian rupees)
(Reporting by Siddhi Nayak; Editing by Savio D'Souza)