Big wilful defaulters owe PNB Rs 14.6k cr

Outstanding rises 23% in eight months, Forever Precious top defaulter

New Delhi : State-owned Punjab National Bank (PNB), which is reeling under a Rs 11,400 crore fraud, has witnessed nearly 23 per cent jump in the amount which wilful defaulters owe it, with loan outstanding of Rs 25 lakh and above, in just over eight months ended January.

The wilful defaulters who have taken loans over Rs 25 lakh from the bank had a gross outstanding against them of Rs 14,593.16 crore as on January 31, 2018, as per PNB data. The bank first started giving out such data from June 2017, when the gross loan outstanding against them was at Rs 11,879.74 crore.

The amount has grown over 22.8 per cent in these eight months. The rise in such outstanding is startling, especially when the bank has been aggressive for over a year now in recovering bad loans.

The 123-year-old bank has unearthed Rs 11,400 crore fraud allegedly involving billionaire jeweller Nirav Modi and associate companies. The fraud pertains to issuance of fake Letters of Understanding (LoUs) to companies associated with Modi by errant PNB employees that enabled these companies to raise buyers credit from international branches of other Indian lenders.

The list of wilful defaulters with over Rs 25 lakh loan as on January 31, 2018 include Rs 747.97 crore against Forever Precious Jewellery & Diamonds; Rs 597.44 crore against Kingfisher Airlines; Rs 410.18 crore against Zoom Developers and Rs 266.17 crore against MBS Jewellers Pvt Ltd among others.

PNB CMD Sunil Mehta said last week that the bank would take all the legal action to bring the perpetrators to the books and that it will also honour all its bonafide commitments.

PNB has been putting out the list of wilful defaulters since June 2013 which it continued till May 31, 2017. Since then it is only listing out those wilful defaulters with outstanding of Rs 25 lakh and above with their names/proprietorship from June last 2017. Bank’s net non-performing assets (NPAs) or bad loans fell to Rs 34,076 crore at the end of third quarter ended December of the current fiscal, from Rs 34,994 crore at end-December, 2016. Gross NPAs were up however at Rs 57,519 crore as on December 31, 2017 as against Rs 55,628 crore by the same period of previous fiscal.

In terms of ratio, the net NPAs fell to 7.55 per cent of the net advances by end of third fiscal 2017-18 from 9.09 per cent in the year ago same quarter. Gross NPAs were 12.11 per cent, as against 13.70 per cent.

Post the third quarter earnings announcement on February 6, Mehta said he hoped to see good recoveries in bad loans in the last quarter ending March 2018.

Industry body calls for privatisation

New Delhi : The fraudulent transactions of Rs 11,400 crore detected at Punjab National Bank (PNB) should act as a strong trigger for the government to reduce its stake to less than 50 per cent in public sector banks (PSBs), industry body Assocham said on Sunday.

It argued that PSBs should then be allowed to function on the lines of private sector lenders with a full sense of accountability to their shareholders, protecting the interest of depositors.

The $1.77 billion (about Rs 11,400 crore) scam in PNB involves billionaire jeweller Nirav Modi allegedly acquiring fraudulent letters of undertaking (LoUs) from a branch in Mumbai to secure overseas credit from other Indian lenders.

“The PSU banks, ironically, are slipping from one crisis to the other and there is a limit the government can keep bailing them out at the cost of taxpayers’ money, even if it is the principal shareholder in these lenders,” Assocham said. It claimed that top banking positions are treated as extension of a government job and the senior most managements spend bulk of their quality time, receiving and implementing directions from the bureaucrats even for innocuous issues.

“In the process, the core banking functions, including all important risk mitigation and management, take a back seat,” it said.


Mobile No
Your Comment *