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Punjab National Bank (PNB) will face an estimated 90 billion-rupee ($1.03 billion) impact as the lender transitions to a central bank-mandated credit loss framework by 2031, its chief executive said on Monday.The country's third-largest state-owned lender by market capitalisation is one of the first to disclose an estimate on the likely effect of the rules, issued by the Reserve Bank of India earlier this month, to its balance sheet."The impact comes to around 90 billion rupees," said Ashok Chandra, PNB's managing director and CEO in an interview with Reuters. "The bank has done a rough estimate as this (new credit rules) was already in the pipeline ... I don't see any further deviation."The RBI's draft guidelines require banks to transition to an expected credit loss (ECL) framework, wherein funds are set aside to cover likely risk of default, over a five-year period starting April 1, 2027. At present, provisions for bad loans are made when a loan becomes overdue.Top Indian banks, including the State Bank of India , are in the process of evaluating the impact from the transition.As per internal estimates, Chandra said, the New Delhi-based bank will face an impact of around 0.85 percentage points to its capital to risk assets ratio (CRAR), a metric that measures bank's capital adequacy.PNB's CRAR was at 17.19%, as on September 30, according to the company's presentation. As per RBI's latest financial stability report, Indian commercial banks had a CRAR of 17.3% at March-end.The impact will be offset by the profit generated from the bank's operations in the normal course, said Chandra."I think we will be able to manage with our internal accrual itself. Bank is well poised to take care of all requirements which is going to come in future."For PNB, a majority of these provisions will be for stage-two assets in its retail, agriculture and small and medium enterprises portfolios, Chandra said.Stage-two assets refer to high-risk loans where the borrower has missed a repayment deadline but has not turned into a non-performing asset.The lender on Saturday reported a net profit of 49.04 billion rupees for the second quarter, up 14% from a year earlier. Chandra projects the bank to post a net profit of over 150 billion rupees for the 2026 financial year.

Indian shares advanced for a fourth session on Monday, with the Sensex climbing 0.5% and the Nifty closing above the 25,800 mark, as heavyweight Reliance Industries and HDFC Bank surged on post-results optimism. Gains were partly offset by profit-taking in ICICI Bank, which capped the broader rally.The S&P BSE Sensex surged 411.18 points, or 0.49%, to close at 84,363.37, while the NSE Nifty 50 rose 133.30 points, or 0.52%, to settle at 25,843.15.On the 30-stock Sensex, Reliance Industries, Bajaj Finserv, Axis Bank, SBI, and TCS led the gains, advancing between 1.8% and 3.5%.Reliance Industries jumped 3.5% to a three-month high after its September-quarter results, as analysts turned upbeat on the conglomerate’s core earnings, retail momentum, and improving outlook across businesses.HDFC Bank ended little changed after touching a record high earlier in the session, buoyed by steady quarterly earnings and an improvement in asset quality.ICICI Bank slipped 3.2%, even as it topped profit estimates, with investors flagging concerns over muted loan and deposit growth.Broader markets also firmed, with the mid-cap index up 0.8% and small-caps rising 0.5%. The Sensex and Nifty have now climbed 2.8% over four sessions, leaving them less than 2% below their record highs from September 2024.Indian markets will hold a special one-hour Muhurat trading session on Tuesday, from 2:30 p.m. to 3:30 p.m. IST, to mark Diwali.Expert viewsThe Indian market extended its positive momentum, driven by better-than-expected Q2 results from major companies and festival optimism and positive global cues further bolstered investor sentiment, with easing trade narratives between the US-China and rise in European market led by defense stocks, said Vinod Nair, Head of Research at Geojit Investments, adding that improved FII inflows in the cash market turned the domestic market into a net buyer in October, following three consecutive months of selling. "PSU banks and mid-sized financial services led the charge, benefiting from potential acquisitions and improvement in margins & asset quality as per Q2 results. The oil industry also experienced notable gains, thanks to declining crude prices and a strengthening Indian rupee," said Nair.