CBI names ex-PNB CEO Usha Ananthasubramanian in PNB scam case

  • CBI names ex-PNB CEO Usha Ananthasubramanian in PNB scam case

CBI names ex-PNB CEO Usha Ananthasubramanian in PNB scam case

The announcement came within hours of CBI filing its first chargesheet in the country's largest financial scam of more than Rs 12,000 crore in PNB allegedly perpetrated by billionaire jeweller Nirav Modi.

Part of the reason for the bank reporting an operating loss in the fourth quarter is the higher employee cost, for which it had charged ₹63.45 crore in Q4 FY18 and deferred ₹190 crore to the subsequent three quarters. A Bloomberg poll of 14 analysts had estimated, on an average, that the bank will report a stand-alone loss of Rs3,835 crore in the quarter ended March.

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The officials said Nirav Modi and Nishal were beneficiaries of the fraud, authorised signatories, and in the know of the whole scam.

PNB on Tuesday said its losses widened to Rs 13,417 crore in the January-March 2018 quarter from Rs 262 crore in the same period past year.

What was breathtaking to watch in PNB results was their higher than expected provisions and gross NPAs.

In absolute term, the gross NPA of the bank surged to Rs 86,620 crore in the fourth quarter as compared to Rs 55,370 crore in same quarter a year ago.

The bank said its net non-performing assents had risen from 7.5% in March 2017 to 11.24% in March 2018.

PNB had reported a Rs 143.5 billion fraud in January, wherein a few of its employees had issued letters of undertaking, in collaboration of Nirav and Mehul firms, in an unauthorised manner. The provision for bad loans stood at ₹16,200 crore.

The modus operandi in the IOB case was similar to the Nirav Modi case. PNB's earnings will be pressurised as it will have to make enough provisions to deal with the scam-related payouts to other banks. The remaining amount will be covered in the three quarters of the current fiscal year.

"The moment I have definitive information either from the regulation side, supervision side or investigation side, the government will not hesitate in taking action to protect people's trust in the banking system", he said. The bank has said that it has paid liabilities totalling Rs 6,586.1 crore on account of LoUs/FLCs during the quarter ending March 31.

Shares of Allahabad Bank today tumbled almost 9 percent after the state-owned company said the Reserve Bank has imposed restrictions on its lending to risky assets and raising high-cost deposits in view of deteriorating financial health. The public sector lender's stock has fallen 47.6% so far this year as against a 5.2% rise in the benchmark S&P BSE Sensex Index.