Punjab National Bank shares fell as much as 7 per cent to hit intraday low of Rs 34.60 after the state-owned lender reported Rs 3,689 crore loan granted to Dewan Housing Finance Limited (DHFL) as fraud to the Reserve Bank of India.
PNB, which was hit by a $2 billion fraud involving billionaire Nirav Modi in 2018, has made provision of Rs 1,246.58 crore towards the DHFL loan as per the norms laid by the RBI, Punjab National Bank said in an exchange filing.
Banking regulations require the provision on an account affected by fraud to be 100 per cent, made over four quarters. DHFL, which was once one of the country’s top “shadow” lender, accumulated total debts of almost Rs 1 lakh crore and then failed to honour dues to its creditors.
Government agencies are investigating DHFL’s promoters and its loan book to determine the extent of any fraud.
Other banks including State Bank of India and Union Bank have also reported DHFL’s accounts as fraudulent.
As of 10:30 am, Punjab National Bank was trading 4.85 per cent lower at Rs 35.25, underperforming the Sensex which was down 0.3 per cent.