New Delhi: Punjab National Bank that saw its earnings wiped out by an unprecedented fraud aims to report the nation’s biggest bank profit by selling some assets, according to people familiar with the matter.

Punjab National Bank (PNB) is targeting net income of more than 5,000 crore ($730 million) for the three months through 30 September, boosted by asset sales and bad-loan recoveries, the people said. Much of the record earnings will come from a planned sale of PNB’s stake in its housing finance unit, they added, asking not to be identified as the information is private.

The 124-year-old PNB is trying to regain its financial health and credibility following the uncovering of a $2 billion fraud this year. The scam caused it to slip one spot to become India’s third-largest state-run bank by assets and analysts, including those at Goldman Sachs Group Inc., cut profit estimates for the lender.

PNB had reported India’s biggest ever bank loss of 13,420 crore in the quarter ended 31 March as it had to account for the fraud. It has already provided for half of the roughly 14,400 crore it owes other banks to make good for the scam, and said the rest will be paid over three quarters — approximately 2,400 crore each quarter if spread equally.

PNB will probably report a loss of 2,400 crore for the three months ended 30 June, according to the average of 11 estimates in a Bloomberg survey. This narrowing is expected to be led by a drop in bad loans following the sale of bankrupt Bhushan Steel.

For the current quarter, the lender expects profit will be further boosted by more than 8,000 crore it estimates to get by selling so-called non-core assets, the people said. This includes its stake in PNB Housing Finance Ltd., they added. If PNB does report net income of 5,000 crore, it would be the biggest quarterly profit in India’s banking sector.

A PNB spokesperson didn’t immediately answer two phone calls and an email.

PNB and Carlyle Group plan to jointly sell at least 51% of PNB Housing Finance, the bank told the stock exchange on Wednesday, without sharing more details. Together, these two investors hold more than 60% of PNB Housing Finance, data compiled by Bloomberg show, and PNB’s roughly 33% holding is worth about 6,800 crore based on Friday’s share price.

“It is reasonable to assume that the stake sale in PNB Housing could happen around the prevailing market prices," said Gaurang Shah, chief investment strategist at Geojit Financial Services Ltd. in Mumbai. “However, this one-off gain would not change the outlook for Punjab National Bank much."

The New Delhi-based bank also aims to cut its risk-weighted assets by more than 20,000 crore and halve its net bad-loan ratio from 11.2% over the year through March 2019, the people said.