Punjab National Bank’s (PNB) net profit for the quarter ended June 30 stood at Rs 1,675 crore, down 49 per cent year-on-year, according to its stock exchange filing on Wednesday. The public sector lender had posted a net profit of Rs 3,251 crore in the same quarter last year (Q1 FY25) and Rs 4,567 crore in the preceding quarter (Q4 FY25).

Meanwhile, PNB’s total income for the quarter rose 15.7 per cent YoY to Rs 37,231 crore from Rs 32,165 crore in Q1 FY25. The bank had reported a net income of Rs 36,705 crore in the preceding quarter. Meanwhile, the net interest income (NII) moved up marginally to Rs 10,578 crore, compared to Rs 10,468 crore in the same period a year earlier.

The bank’s profit was primarily hampered by a sharp increase in tax expenses, which more than doubled in absolute terms from Rs 2,017 crore to Rs 5,083 crore. The bank’s underlying operational strength during the quarter was overshadowed by this spike in tax outflow.

The bank reported an improvement in its asset quality in the quarter under review. Gross non-performing assets (NPAs) fell to Rs 42,673 crore, with the Gross NPA ratio improving to 3.78 per cent from 4.98 per cent a year ago.

Similarly, the Net NPAs ratio dipped to 0.38 per cent, compared to 0.60 per cent in Q1 FY25, as per the filing. In line with the improved asset quality, the bank’s provisioning requirements dropped significantly to Rs 396 crore, down from Rs 792 crore in the corresponding quarter last year.

According to the filing, the Bank’s profit before tax (PBT) increased by 28 per cent to Rs 6,758 crore in Q1 FY26 as against Rs 5,269 crore in Q1 FY25. Its global Business grew by 11.6 per cent on a YoY basis to Rs 27,19,276 crore as on June 25 from Rs 24,36,929 Crore as on June 24, the bank said.