BENGALURU (Reuters) - India's PNB Housing Finance reported a 57% rise in fourth-quarter profit on Monday, helped by steady demand for home loans and a decline in bad loans.

Demand for premium and luxury housing has been strong over the last year even as the affordable segment saw demand easing due to high interest rates.

Home financiers saw strong disbursement in the fourth quarter as home buyers pinned hopes on a rate cut later this year.

PNB Housing Finance, a unit of state-run lender Punjab National Bank, said its disbursements from the retail segment, which is their largest, jumped one-fourth, boosting total disbursements by 24% to 55.74 billion rupees.

The company's consolidated net profit rose to 4.39 billion rupees ($52.6 million) for the quarter ended March 31 from 2.79 billion rupees a year earlier.

PNB Housing Finance has scaled back on corporate loans over the last few quarters due to increased bad debt in the segment, aiding its bottomline.

The home financier's gross bad loans as a percentage of total loans declined to 1.50% at the end of March, from 1.73% at the end of December.

The company's bad loan provisions and write-offs declined 95% to 66.4 million rupees.

Its net interest income, the difference between interest earned and paid, rose 7% year-on-year to 6.32 billion rupees. The net interest margin expanded to 3.65% from 3.49% a quarter earlier.

The company approved raising of funds through a debt issue of up to 25 billion rupees.

Shares of PNB Housing Finance settled 2.3% higher after results.

($1 = 83.4725 Indian rupees)

(Reporting by Nishit Navin in Bengaluru; Editing by Mrigank Dhaniwala)