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PNB Reports Rs 2,434 Crore Borrowal Fraud Linked to Former SREI Promoters

The exposure relates to SREI firms now owned by NARCL following IBC resolution.

Overview

  • The bank notified the RBI in a regulatory filing, detailing Rs 1,240.94 crore tied to SEFL and Rs 1,193.06 crore to SIFL.
  • PNB said it has made 100% provisions for the entire amount, indicating no fresh impact on earnings.
  • The fraud classification follows forensic-audit findings reported to include related-party siphoning and loan evergreening.
  • The RBI had superseded the boards of the two NBFCs in October 2021 over governance lapses after large repayment defaults.
  • NCLT approved NARCL’s resolution plan in August 2023 and the acquisition closed in December 2023, distancing current management from the alleged actions of the erstwhile promoters.