The Punjab National Bank reported a net loss of Rs 13,416 crore in the fourth quarter of the 2017-’18 financial year. The bank’s poor performance in the last quarter of 2017-’18 follows an alleged fraud of over Rs 13,000 crore involving businessmen Nirav Modi and Mehul Choksi.
The bank had made a profit of Rs 262 crore in the fourth quarter of the previous financial year.
The Punjab National Bank’s statement on Tuesday said it had ensured provisions and contingencies worth Rs 20,353.10 crore for the quarter that ended in March. This was significantly higher compared to the provisions worth Rs 4,466.68 crore it had made in the quarter that ended in December.
The bank said its net non-performing assents had risen from 7.5% in March 2017 to 11.24% in March 2018. The lender’s gross non-performing assets increased from 12.11% to 18.38% in the fourth quarter.
The bank’s share value declined by 6.10% to Rs 83.85 per share after the announcement of its quarterly results. The lender’s share price has reduced by 47.6% this year, Bloomberg reported.
On February 14, the Punjab National Bank had informed the Bombay Stock Exchange that it had detected “fraudulent and unauthorised transactions” worth Rs 11,380 crore at its Brady House branch in South Mumbai. The bank revised this figure to Rs 12,703 crore and later to around Rs 13,645 crore.
A few officials of the public sector bank had allegedly issued fraudulent Letters of Undertaking – essentially letters of credit telling others banks that it would meet a customer’s liabilities – to Modi’s companies. Some bank officials have been arrested and are under investigation.