Punjab National Bank (PNB) shares tanked 11 percent in trade on Monday after the public sector lender on Saturday said it has detected a fraud of more than Rs 3,800 crore by Bhushan Power & Steel (BPSL) and has reported it to the Reserve Bank of India (RBI).
PNB said Bhushan Power & Steel embezzled bank funds and manipulated its books of accounts to raise funds from consortium lender banks.
Punjab National Bank (PNB) in a regulatory filing said, “on the basis of forensic audit investigation findings and CBI filing FIR, on suo moto basis, against the company and its directors, alleging diversion of funds from the banking system, a fraud of Rs 3,805.15 crore is being reported by the bank to RBI.”
The lender added that it has already made provisions amounting to Rs 1,932.47 crore, as per prescribed prudential norms, for the BPSL account.
The shares of the bank closed 10.95 percent lower at Rs 72.80 on BSE.