Punjab national bank has issued a regulatory intimation to stock exchanges regarding a potential bank strike scheduled for January 27, 2026. The notification, filed under Regulation 30 of SEBI (LODR) Regulations, 2015, alerts stakeholders about possible disruptions to banking operations.

Strike Details and Organizers

The strike has been called by the United Forum of Bank Unions (UFBU) on behalf of nine constituent unions and associations, along with the All India Bank Officers Association (AIBOA). The industrial action is being undertaken in support of their demands, though specific details of these demands were not disclosed in the regulatory filing.

Bank's Preparedness and Impact Assessment

Punjab National Bank has indicated that it is taking necessary steps to ensure smooth functioning of its branches and offices during the strike period. However, the bank has cautioned that if the strike materializes as planned, the functioning of branches and offices may be affected.

The notification emphasizes the bank's commitment to maintaining operations while acknowledging the potential for service disruptions. This proactive communication allows customers and stakeholders to prepare for possible inconveniences.

Regulatory Compliance and Communication

The intimation was officially signed by Bikramjit Shom, Company Secretary of Punjab National Bank, and digitally authenticated on January 23, 2026. The document was simultaneously communicated to both the National Stock Exchange of India Limited and BSE Limited, ensuring comprehensive regulatory compliance.

The Department of Financial Services (DFS), Ministry of Finance, Government of India, and the Indian Bank Association (IBA) have been informed about the strike call, indicating coordination at the highest levels of banking administration.

Stakeholder Impact

This regulatory disclosure serves as an early warning system for various stakeholders including customers, investors, and business partners. The advance notice allows for contingency planning and helps manage expectations regarding service availability during the strike period.

The bank's transparent communication approach demonstrates its commitment to regulatory compliance and stakeholder information, even when facing potential operational challenges from labor action.

Punjab National Bank has implemented a 20 basis points reduction in deposit rates across all tenures effective January 1, 2026, as the state-owned lender grapples with mounting pressure on net interest margins following a series of RBI rate cuts. Managing Director and Chief Executive Ashok Chandra indicated that further deposit rate cuts remain on the table as the bank seeks to restore margin stability.

Margin Compression Intensifies Pressure

The bank's domestic net interest margin has experienced significant compression, falling to concerning levels amid the challenging rate environment. The following table illustrates the deterioration in key margin metrics:

The data reveals that while deposit costs have remained relatively sticky, declining only marginally from 5.18% to 5.10%, loan yields have fallen more sharply, creating the margin squeeze that is driving the bank's aggressive repricing strategy.

Strategic Response to RBI Rate Cuts

Chandra acknowledged that deposit rate cuts had been limited so far due to a "dynamic" market environment and the need to balance depositor interests. However, the mounting margin strain is now pushing the case for faster repricing. The Reserve Bank of India has implemented 125 basis points of rate cuts since February 2025, including a 25 basis points reduction in December 2025, adding significant pressure on banking margins.

"As of now also, hardly 80 bps rate cut has happened in any segment in our deposit. So there is still enough room," Chandra told Mint, indicating the bank's readiness for further adjustments. The bank's asset-liability committee will assess the impact of the latest rate cut at month-end before determining future deposit rate strategies.

Financial Performance and Outlook

Despite margin pressures, PNB delivered solid financial results for the quarter. The bank's performance metrics demonstrate resilience amid challenging conditions:

The Casa ratio declined to 37.10% from 37.30% in the previous quarter and 38.10% a year earlier, reflecting the challenging deposit environment.

Repricing Strategy and Future Expectations

Management expects margins to stabilize through strategic repricing of the bank's special 440-day term deposit scheme launched last year, through which PNB raised over ₹2.80 trillion at rates of 7.25% and 7.75%. Chandra revealed that 70% repricing has occurred up to December 31, with 21% scheduled for repricing in the March quarter and the remaining 9% in Q1FY27.

"For Q4, we expect our NIM to remain at around the same levels as that of Q3 despite the full impact of December rate cut in Q4," Chandra stated during the bank's Q3 earnings call on January 19. The bank expects full-year FY26 domestic NIM to remain above FY25's 2.70%.

Market Analysis and Challenges

Brokerage firm Elara Capital flagged continued pressure in a post-earnings note, highlighting that PNB's Q3 NIM decline of 8 basis points sequentially came in below estimates and declined more sharply than peers. Elara expects full-year FY26 NIM at 2.40%, significantly below PNB's revised guidance of 2.80%-2.90%, which was already reduced from the original 2.90%-3.00% target.

Weighted average rates on domestic term deposits across the banking system fell to 6.80% in November 2025 from 7.20% in February 2025, according to RBI data, indicating the broader industry challenge in managing deposit costs amid the rate cutting cycle.