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Shares of PNB plunged to 20-month low after the lender has uncovered more fraudulent loans. Shares of state-run Punjab National Bank Ltd fell as much as 8.93 per cent to Rs 102, lowest since June 24, 2016.
Amid the multi-agency probe into the PNB scam, the state-run bank had yesterday said the amount of fraudulent transactions could be Rs 1,300 crore more than the current estimate of about Rs 11,400 crore.
The alleged fraud, by far the biggest ever detected by a local bank, is centred around companies linked to a billionaire jeweller Nirav Modi and his uncle Mehul Choksi, owner of Gitanjali Gems Ltd.
A number of banks provided loans to Modi and Choksi after PNB issued letters of undertaking, or guarantees, for the loans.
The PSU Bank index was down 2.5 per cent, with all stocks trading in the red. PNB stock fell over 30 pct in nine trading sessions since the fraudulent transactions were first reported, while the PSU Bank index fell 8.8 per cent during that period.
On February 14, the bank had detected the fraud wherein billionaire jeweller Nirav Modi and associates had allegedly acquired fraudulent letters of undertaking (LoUs) from one of the branches of the PNB for overseas credit from other Indian lenders.
“...We have to inform that quantum of reported unauthorised transactions can increase by $204.25 million (approximately),” the filing said. At the current exchange rate, the amount comes to around Rs 1,323 crore.
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