India ratings affirms PSB infrastructure bonds at 'IND AA'/stable

India Ratings and Research (Ind-Ra) has reaffirmed Punjab & Sind Bank's (PSB) infrastructure bonds at 'IND AA'/Stable, as announced on October 7, 2025. The rating applies to INR30.0 bn in infrastructure bonds, issued on December 20, 2024, with a 7.74% coupon rate and a maturity date of December 20, 2034. This affirmation is largely due to Ind-Ra factoring in the availability of support from the Government of India, which holds a 93.85% stake, underscoring PSB's systemic importance.

The rating reflects the bank's improved capital position, operating buffers, and enhanced ability to absorb credit costs. PSB's profitability buffers have strengthened, provision cover for stressed assets has improved, and capitalization has seen a boost through reduced risk-weighted assets and a shift towards a granular loan portfolio.

PSB's financial indicators for FY25 show total assets of INR1,618.1 bn, total equity of INR133.6 bn, and net income of INR10.2 bn. The bank achieved a Return on Assets (ROA) of 0.66% and maintained a CET-1 ratio of 15.59% and a Capital Adequacy Ratio (CAR) of 17.41%.