Hit hard by the Rs 13,000 crore scam, PNB has decided to tighten loan disbursement and set up a monitoring mechanism to check loan slippages and fraud.
PNB had issued as many as 41,178 LoUs since 2011, of which 1,590 were given to Nirav Modi, Mehul Choksi and their associates, the finance ministry has said.
PNB said it will honour all "bonafide" Letter of Undertakings, an instrument which was used by billionaire diamantaire Nirav Modi to defraud the bank of Rs 12,968 crore.
Public sector banks want PNB to honour its commitment with regard to LoUs allegedly issued by it to Nirav Modi and its associates, said SBI Deputy MD M S Sastry.
Bank stocks fell as much as 2 percent today amid concerns over fresh case relating to "fraudulent" issuance of LoUs.
All PSBs have verified LoUs issued by them, and there are no other unauthorised authority letters except for those issued by PNB, a senior SBI official said.
Reacting to RBI's decision to scrap the system of issuing LoUs and LoC, industry body CII said it would have a disruptive impact on the buyers credit market.
RBI banned banks from issuing LoUs instruments used allegedly Nirav Modi and Mehul Choksi to defraud PNB of Rs nearly 13,000 cr in connivance of bank officials.
Jaitley said Nirav Modi obtained his first fraudulent guarantee from PNB's Brady House branch on March 10, 2011 and managed to get 1,212 more such guarantees in six yrs.
RBI has initiated special audit of state-owned lenders with focus on trade financing activities, especially relating to issuance of LoUs by them, banking sources said.
Acquires Cynosure Inc and Cynosure Interface Solutions for $31mn and Rs13cr respectively
To add platform capabilities in the insurance segment which contributes 15% of total business
The Acquisition is expected to close within the next 3 months
Sells Essar Steel loan to Deutsche Bank
Has sold its $385 mn Foreign currency loan extended to Essar Steel
Bank has taken a 38% haircut
Rs 1600 cr is expected earnings to the bank from the deal
Economic Times Reports
To Sell 50% stake in prime Mumbai office assets to Blackstone for $1.3bn
The co is also in discussions to sell its residential and commercial projects in Chennai
To convene shareholder’s meet on 23rd March in regard to the proposed divestment
Gets Order Worth Rs 230 Cr From NTPC
To perform the pressure part metallurgy upgradation for 3 660MW super critical steam generators
Will help NTPC commission the 3x 660MW plant started 12years
Declared L1 bidder for EPC Project in UP worth Rs 677cr from NHAI
The completion period for the project is 30 months