PNB CEO Atul Kumar Goel Predicts Interest Rate Cut Amid Inflation Trends
Atul Kumar Goel, the Managing Director and CEO of Punjab National Bank (PNB), has shared his expectations for a potential interest rate cut of 20 to 25 basis points by March 2025, provided conditions remain favorable. This comes as the Reserve Bank of India (RBI) has kept the repo rate unchanged at 6.5% for the tenth consecutive meeting.
Inflation in India is currently under control, with a rate of 4.6% in the first half of 2024-25, a decrease from 5.5% during the same period last year. Goel also mentioned that deposit rates are at their peak, and he does not foresee any further increases.
Discussing loan growth, Goel highlighted an 18% increase in home loans and a 25% rise in car loans, with strong demand for housing loans in Tier 2 and Tier 3 cities. He expects a 12% growth in home loans for the next quarter.
PNB recently released its financial results for the quarter and half-year ending September. The bank’s net profit surged by 145% year-on-year to Rs 4,303 crore in the July-September 2024-25 period, compared to Rs 1,756 crore in the same quarter of the previous fiscal year. Net Interest Income (NII) also improved by 5.99% to Rs 10,517 crore.
Savings deposits grew to Rs 488,635 crore, marking a 3.7% year-on-year increase, while current deposits rose to Rs 68,104 crore, a 1.6% growth. CASA Deposits (Current Account Savings Accounts) increased to Rs 556,739 crore, recording a 3.4% year-on-year growth.
Doubts Revealed
PNB -: PNB stands for Punjab National Bank, which is one of the largest banks in India. It provides various banking services like savings accounts, loans, and more.
CEO -: CEO means Chief Executive Officer. This is the person who is in charge of managing the entire company or organization.
Interest Rate Cut -: An interest rate cut means the bank will lower the percentage it charges on loans or pays on deposits. This can make borrowing money cheaper.
Inflation -: Inflation is when the prices of goods and services go up over time. It means you need more money to buy the same things.
Basis Points -: Basis points are a way to describe changes in interest rates. One basis point is equal to 0.01%, so 20 to 25 basis points mean 0.20% to 0.25%.
Repo Rate -: The repo rate is the rate at which the Reserve Bank of India lends money to commercial banks. It influences the interest rates in the economy.
Net Profit -: Net profit is the amount of money a company has left after it pays all its expenses. It’s like the company’s earnings.
Net Interest Income -: Net Interest Income is the difference between the interest a bank earns from loans and the interest it pays on deposits. It’s a measure of a bank’s profitability.