Punjab and Sind Bank plans to enter the mutual funds sector to expand fee-based income, aiming to find a partner by September 2023.
State-owned Punjab & Sind Bank has reportedly planned to foray into mutual funds in a bid to expand their fee-based income. The bank aims to find a partner by September 2023.
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According to a report by news agency PTI, a senior official of the Punjab & Sind Bank has said that the bank has already floated a Request for Proposal to finalise a partner in the Fintech space. “we hope to conclude the process soon,” Punjab & Sind Bank managing director Swarup Kumar Saha told the news agency.
Swarup Kumar Saha told the news agency that the bank would be able to finalise a partner by the end of second quarter and start operations during the current financial year. The asset management business would help the bank in increasing fee income by cross-selling products, he added.
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India at the moment has a total of 44 asset managment companies. The Assets Under Management (AUM) management by these companies stood at ₹44,39,187 crore as of 30 June 2023.
The AUM of the Indian Mutual Fund Industry has grown from ₹8.11 lakh crore at June-end 2013 to ₹44.39 lakh crore as of 30 June 2023, more than a five-fold increase in a span of 10 years.
Many public sector lenders, including the State Bank of India (SBI), have their mutual fund subsidiaries.
Talking about the growth plan for the current financial year, Saha told PTI, credit growth is expected to be 13-14 per cent, while deposit mobilisation would witness a growth of 8-10 per cent during the current fiscal.
With regard to recovery, he said the bank expects a recovery of ₹1,500 crore and aims to keep fresh slippages under ₹1,500 crore in the current financial year.
He further said that the provision coverage ratio should increase to 90 per cent from the present level of 88.58 per cent.
In terms of asset quality, he said, the bank aims to bring down gross NPA to 6 per cent while net NPA below 1.5 per cent during the year.
On Saturday, Punjab & Singh Bank on Saturday announced their Q1 results and posted a 25% year-on-year decline in their net profits. The profit after tax (PAT) of the bank dropped to ₹152.6 crore from 204.7 crore during the corresponding quarter previous fiscal.
