Shares of the downtrodden Punjab National Bank plunged heavily on Tuesday hitting the lowest level since June 2016 after the fraud got bigger with the amount further escalating to Rs 12,700 crore.
Shares of the downtrodden Punjab National Bank plunged heavily on Tuesday hitting the lowest level since June 2016 after the fraud amount further escalated to Rs 12,700 crore. The second-largest PSU lender PNB is undergoing the biggest ever banking scam in India involving the usage of fake LOU (Letters of Undertaking) by the alleged diamond merchant Nirav Modi. In the latest development to the case, Punjab National Bank had said that the estimated amount of the fraud can go up by Rs 1,300 crore more from the current approximate of Rs 11,400 crore. Following the paramount and considerable leap in the quantum of the scandal, shares of PNB cracked nearly 9% on Monday’s session.
Earlier yesterday, PNB said in a regulatory filing that the quantum of “reported unauthorized transactions” can inch up by $204. 25 million or Rs 1,323.34 crore (as per rupee’s closing on 26 February 2018). This announcement came in the continuation of the exchange filing when PNB said that the bank has detected “unauthorised and fraudulent transactions” in the Brady House branch of Mumbai amounting to $1.77 billion or Rs 11,400 crore.
The stock of Punjab National Bank plunged as much as 8.93% to more than one-and-half-year-low of Rs 102 on NSE while the stock nosedived 8.76% to Rs 102.1 on BSE. PNB shares touched the lowest since June 2016 on Monday. Way back on 24 June, PNB shares were at a low of Rs 93.55 on NSE. A massive trading volume has been observed in the shares of PNB, as at 10:40 am, more than 5.1 crore shares exchanged hands on both NSE and BSE with about 4.75 crore shares on NSE alone.
In the biggest banking scandal in the nation, Billionaire Nirav Modi is accused of obtaining buyer’s credit from several Indian lenders on the basis of LOU (Letters of Undertaking) issued by PNB without following proper protocols. Nirav Modi group companies are undergoing a probe from Enforcement Directorate and Central Bureau of Investigation.
In the latest development of the case, the Enforcement Directorate had summoned Punjab National Bank’s Managing Director and CEO Sunil Mehta, Nirav Modi, his wife Ami and his uncle Choksi. According to a PTI report, the beleaguered billionaire jeweller Nirav Modi, his wife Ami and his uncle Mehul Choksi had skipped their scheduled appearance before the Enforcement Directorate (ED) in Mumbai.