PNB's stake sale in housing fin arm credit positive

PNB
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The sale of Punjab National Bank's 13 per cent stake in PNB Housing Finance is credit positive as it will strengthen the bank's capital, Moody's said on Monday.

New Delhi: The sale of Punjab National Bank's 13 per cent stake in PNB Housing Finance is credit positive as it will strengthen the bank's capital, Moody's said on Monday.

Last month state-run Punjab National Bank announced that it will sell 13 per cent stake in PNB Housing Finance for Rs 1,850 crore ($270 million) to global private equity firm General Atlantic Group and alternative investment firm Varde Partners.

"The proceeds of the sale will strengthen the bank's capital, a credit positive.

We estimate that the sale will increase PNB's Common Equity Tier 1 (CET1) ratio by about 40 basis points from the 6.9 per cent reported in December 2018," Moody's said in a statement.

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