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PNB case: Will take appropriate supervisory action, says RBI

By Pti
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    The Reserve Bank on Friday said it has already undertaken an assessment of control systems at scam-hit Punjab National Bank and will take "appropriate supervisory action".

    Image for representation only

    The country's second largest state-run lender has been rocked by a Rs 11,400-crore fraud allegedly involving billionaire diamantaire Nirav Modi.

    In a statement, the central bank said it has already undertaken a supervisory assessment of control systems in Punjab National Bank (PNB).

    "The fraud in PNB is a case of operational risk arising on account of delinquent behaviour by one or more employees of the bank and failure of internal controls.

    "RBI has already undertaken a supervisory assessment of control systems in PNB and will take appropriate supervisory action," it said.

    The RBI also denied media reports that it had directed PNB to meet its commitments under the letters of undertaking (LoUs) to other banks.

    State-owned PNB detected a USD 1.77 billion scam where billionaire jeweller Nirav Modi allegedly acquired fraudulent letters of undertaking (LoUs) from a branch in Mumbai to secure overseas credit from other Indian lenders.

    PTI 

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