Shares of the state-run lender Punjab National Bank dropped nearly 6% after the bank said it has detected some fraudulent transactions in one of the branches in Mumbai while Bank of India shares tanked over 4% post Q3 results. The stock of India’s largest bank State Bank of India also declined about 2%. Shares of PSB (public sector banks) witnessed a major decline on Wednesday after the negative earnings reported by major PSU banks with Bank of India down 4%. The stock of Bank of India shed emerged as one of the major losers among the Nifty PSU Bank index. Following a decline in almost all the components of Nifty PSU Bank, the index slipped more than 2% to 3,394.4.
The stock of Punjab National Bank tanked as much as 5.7% to the day’s low of Rs 152.45 on NSE after the bank informed about the fraud transactions. “The Bank has detected some fraudulent and unauthorised transactions (messages) in one of its branch in Mumbai for the benefit of a few select account holders with their apparent connivance. Based on these transactions other banks appear to have advanced money to these customers abroad,” Punjab National Bank said in an exchange filing. The quantum of such transactions is $1,771.69 million (approx), PNB added. A heavy trading volume was witnessed in the shares of Punjab National Bank, as at 10:30 am, about 1.27 crore shares exchanged hands on both NSE and BSE with more than 1.17 crore shares on NSE alone.
Shares of Bank of India crumbled as much as 4.7% to the day’s low of 138.05 after the state-run lender reported a net loss of Rs 2,341.23 crore for the quarter ended 31 December as it had to make up for under-reporting of bad loans worth Rs 14,057 crore and also driven down by treasury losses. Other PSU bank shares also traded in negative territory, Syndicate Bank down 3%, Oriental Bank of Commerce down 2.7%, Allahabad Bank, Union Bank of India, IDBI Bank, Andhra Bank, Canara Bank each declined 2-3% whereas shares of State Bank of India shed 1.65% to Rs 284. Bank of Baroda and Indian Bank were down 0.18 and 1.16% respectively.
Meanwhile today, Indian stock markets erased major gains after opening higher on Wednesday as blue-chip stocks fell substantially in the morning trades with Sun Pharma, SBI, Axis Bank, ICICI Bank losing up to 2%. The S&P BSE Sensex surged as much as 136.51 points or 0.4% to open at 34,436.98 whereas NSE Nifty gained 84.8 points or 0.81% to begin the day at 10,539.75. In the wee hours of trading, Sensex made a low of 34,264.83 and a high of 34,473.43. Shares of Bharti Airtel, HDFC, Adani Ports, RIL, HDFC Bank, Wipro and Infosys were the top gainers among the Sensex components.