Finsamudra Desk
The state-run lender is on track to beat its FY27 recovery target after pulling in ₹366 crore through settlements, asset seizures and insolvency payouts in the first quarter alone.
Punjab & Sind Bank says it is on track to surpass its ₹1,000 crore bad loan recovery target for FY27, with Q1 recoveries and account upgrades totalling ₹366 crore.
The bank is using three main levers to drive this: One-Time Settlements (OTS) to speed up resolution of long-standing sticky accounts, SARFAESI enforcement to take direct possession of collateralized real estate, and NCLT resolutions to secure court-approved insolvency cash payouts.
Legacy non-performing assets have historically weighed on smaller public sector banks, tying up capital that could otherwise support fresh lending.
By recovering cash from written-off accounts, Punjab & Sind Bank is converting stressed assets into direct, low-cost capital that flows to its bottom line, alongside its ongoing digital transformation efforts.
When a public sector lender clears legacy NPAs and recycles that capital, it directly expands the pool of funds available for fresh disbursals — which is where DSAs and connectors source new business. A bank actively recovering ₹366 crore in a single quarter signals improving balance sheet health, which can translate into more aggressive lending targets and better sanction rates for referred cases.
For connectors working with Punjab & Sind Bank, this recovery push is worth tracking: banks freeing up capital from written-off accounts often loosen credit appetite in subsequent quarters, creating an opening to push more loan files through as the lender looks to redeploy recovered cash into fresh growth.
Sources
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