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<keyword id="62034" type="General" weightage="20" keywordseo="punjab-national-bank" source="Orion">Punjab National Bank</keyword> (PNB) on Thursday reported a two-fold jump in standalone net profit at Rs 1,126.78 crore for the third quarter ended December. The state-owned bank had earned a net profit of Rs 506.03 crore in the year-ago period. However, total income during October-December 2021 declined to Rs 22,026.02 crore as against Rs 23,298.53 crore in the year-ago period, PNB said in a regulatory filing. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/boat-sells-about-eight-out-of-ten-products-on-amazon-and-flipkart-which-it-states-as-a-risk-factor/articleshow/89155645.cms">About eight out of ten BoAt products are sold on Amazon and Flipkart, but the company has concerns around it</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/ola-electric-plans-to-hire-200-automotive-engineers-designer-for-its-uk-center/articleshow/89157318.cms">Ola Electric is now looking to invest $100 million in setting up an R&amp;D centre in UK that will hire 200 engineers</a>

Punjab National Bank's net profit more than doubles to ₹1,127 crore

<ul><li><keyword id="47268" type="ORGANIZATION" weightage="20" keywordseo="PNB">PNB</keyword>, India’s second-largest government-owned bank, reported a loss of ₹134.2 billion for the quarter ended March 31st. </li><li>The bank’s provisions surged nearly five times to ₹203.5 billion because it is liable to pay back a lot of the loans that <keyword id="571991" type="PERSON" weightage="20" keywordseo="Nirav-Modi">Nirav Modi</keyword> has defaulted on. </li><li>Modi and his associates defrauded these banks of ₹130 billion ($1.92 billion) between 2011 and 2017- India’s biggest banking fraud. </li></ul> The name “Nirav Modi” isn’t likely to go out of news cycles anytime soon. This past February, it came to light that Modi, a prominent Indian jeweller and billionaire, had used his clout to allegedly procure fraudulent letters of undertaking from a Mumbai branch of the <keyword id="62034" type="ORGANIZATION" weightage="100" keywordseo="Punjab-National-Bank">Punjab National Bank</keyword> (PNB). He then used the letters to get loans from not only PNB, but a number of Indian banks like State Bank of India and <keyword id="6358005" type="ORGANIZATION" weightage="20" keywordseo="allahabad-bank">Allahabad Bank</keyword>, and eventually defaulted on the loans, despite issuing additional letters to pay back these loans. Modi and his associates defrauded these banks of ₹130 billion ($1.92 billion) between 2011 and 2017. This is the biggest banking fraud in India’s history. And now, it’s led to the highest quarterly loss ever by an Indian bank. PNB, India’s second-largest government-owned bank, reported a loss of <a href="https://www.pnbindia.in/downloadprocess.aspx?fid=qTvsjnzvILodoPNEqn9wCQ==">₹134.2 billion</a> for the quarter ended March 31st. Its loss even exceeded its total revenue of ₹129.5 billion. Given that PNB sanctioned the invalid letters of undertaking, it is the main bearer of liability for the loans that Modi and his partner firms have defaulted on. It will have to drum up the payments for these letters of credit itself. Hence, it’s provisions for bad loans and defaulted accounts surged 355% from the previous quarter to a staggering ₹203.5 billion. Around 40% of this figure was accounted for by the Nirav Modi fraud alone. In fact, after staying well under the ₹600 billion mark for all of 2017, the bank’s total amount of bad loans ballooned to ₹866 billion by the end of March 2018. There were around ₹291 billion of fresh bad loans in just the last quarter of fiscal 2018. The bank’s growth will be severely limited for the foreseeable future. All the capital that the managed to raise from institutional investors, <a href="https://www.thehindubusinessline.com/markets/pnb-raises-rs-5000-cr-via-qualified-institutional-placement/article9989982.ece">₹50 billion</a> in December 2017, and the government, <a href="https://www.bloombergquint.com/business/2018/03/08/over-a-dozen-state-owned-banks-to-get-rs-46000-crore-capital-infusion-this-month#gs.3aHyZcg">₹54 billion</a>, was insufficient to cover its provisions, let alone its other growth initiatives and capital expenditure. Given the dire state of PNB’s finances, it is likely to be put under the <keyword id="6354335" type="ORGANIZATION" weightage="20" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword>’s Prompt Corrective Action watchlist (PCA). The operations of 11 of India’s 21 state-owned banks are already being monitored under the PCA programme, which imposes restrictions on fresh loans. PNB is already said to be taking steps to make credit underwriting norms more rigorous and improving its internal auditing process. Meanwhile, the Nirav Modi fraud is still being investigated by India’s Central Bureau of Intelligence and judicial authorities, and names are finally being named. A charge sheet against Modi and his uncle, Mehul Choksi, - both of whom are absconding - was filed by the investigative agency earlier this week. <a href="http://www.business-standard.com/article/current-affairs/pnb-scam-two-bank-execs-removed-allahabad-bank-chief-to-step-down-118051400782_1.html">A number of other people</a>, including senior directors at PNB and Allahabad Bank, were also charged in the filing for various breaches. The senior management of all the banks involved will likely be cleaned out and reshuffled.

How one fraudster drove Punjab National Bank to the highest quarterly loss in the history of Indian banking

<keyword id="19965774" type="General" weightage="20" keywordseo="punjab-national-bank" source="keywords">Punjab National Bank</keyword> (<keyword id="19918505" type="General" weightage="20" keywordseo="pnb" source="keywords">PNB</keyword>) on Thursday announced an over three-fold jump in its profit to Rs 2,223 crore for the October-December quarter of the current financial year, compared to the corresponding figure of Rs 629 crore in the same period last year. The government-owned bank's total income shot up to Rs 29,962 crore during the quarter from Rs 25,722 crore in the same period last year. PNB's net interest income (<keyword id="19936363" type="General" weightage="20" keywordseo="nii" source="keywords">NII</keyword>) went up 12.1 per cent to Rs 10,293 crore from Rs 9,179.4 crore in the year ago period, according to a regulatory filing. The bank's asset quality also improved during the quarter with gross non-performing assets (<keyword id="19964545" type="General" weightage="20" keywordseo="npas" source="keywords">NPAs</keyword>) declining to 6.24 per cent of total loans from 9.76 per cent in the same period last year. Net NPAs came down to 0.96 per cent from 3.30 per cent. The provisions for bad loans made by the bank came down to Rs 2,739.1 crore from Rs 4,713.34 crore in the same quarter of the previous year. SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/webstories/oneplus-12-vs-oneplus-12r-heres-whats-different-between-the-two-devices/slidelist/107138750.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/webstories/oneplus-12-vs-oneplus-12r-heres-whats-different-between-the-two-devices/slidelist/107138750.cms" target="_blank">OnePlus 12 vs OnePlus 12R – What distinguishes the two new smartphones</a><a href="https://www.businessinsider.in/business/auto/webstories/revolt-rv400-brz-an-electric-bike-for-the-city-with-150-km-range-hits-indian-roads/slidelist/107142891.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/webstories/revolt-rv400-brz-an-electric-bike-for-the-city-with-150-km-range-hits-indian-roads/slidelist/107142891.cms" target="_blank">Revolt RV400 BRZ – An electric bike for the city with 150 km range hits Indian roads</a> <a href="https://www.businessinsider.in/business/auto/news/rolls-royce-spectre-rolls-out-as-indias-most-expensive-electric-car/articleshow/107051636.cms">Rolls Royce Spectre rolls out as India’s most expensive electric car</a>

PNB clocks 3-fold jump in net profit at ₹2,223 crore for Q3

<keyword id="109276" type="COMPANY" weightage="20" keywordseo="Honda-India">Honda India</keyword>’s two wheeler arm, Honda Motorcycle &amp; Scooter India Pvt Ltd (HMSI) has signed a Memorandum of Understanding (MoU) with state-run <keyword id="62034" type="CITY" weightage="20" keywordseo="Punjab-National-Bank">Punjab National Bank</keyword> to provide <keyword id="6354851" type="ORGANIZATION" weightage="20" keywordseo="Retail">retail</keyword> finance to Honda two wheeler buyers. 
	 
	“This alliance is first of its kind in the two-wheeler industry - both for Honda and PNB. Propelled by this partnership with Punjab National Bank, we aim to grow Honda's retail finance significantly in coming months,” said Y S Guleria, Vice President, Sales and Marketing, HMSI. 
	Through this strategic alliance, company aims to tap its target audience in rural areas. “With 40% of branches of PNB in rural areas and additional 24% in semi-urban areas, Honda's strategic alliance with Punjab National Bank will help it make deeper inroads into hinterland”, the company said in a statement. 
	 
	By availing this offer, customers can save up to Rs 10,000 by getting loan finance for 90% of the value of the product at a lower rate of interest of 12.25%. The auto maker claims that the interest rate is the lowest in the industry. 
	 
	Commenting on the partnership, S S Bhatia, General Manager, Retail Assets Division, Punjab National Bank said that the bank has offered two retail finance schemes through this alliance. “Our Bank has 80 specialized retail asset branches at prime locations for financing only retail loans. Honda is synonymous globally with high quality products at reasonable prices…Through customized and convenient finance options, we look forward to partnering Honda in fulfilling the dreams and aspirations of millions in India,” added Bhatia. 
	 
	Reports suggest that HMSI is expecting to clock in a sale of 4.5 million scooters and motorcycles in the current fiscal year, posting a growth of 22% against 3.7 million units sold in the last fiscal year.

Honda India To Woo Customers
Through Easy Retail Loans; Ties-Up With PNB

The government on Wednesday asked state-owned banks to defer <keyword id="9420782" type="UNKNOWN" weightage="20" keywordseo="avoidable-expenditure">avoidable expenditure</keyword>, including purchase of <keyword id="9420781" type="UNKNOWN" weightage="20" keywordseo="staff-cars">staff cars</keyword> and refurbishment of guest houses, to ensure more productive utilisation of <keyword id="625899" type="PERSON" weightage="20" keywordseo="financial-resources">financial resources</keyword> amid the coronavirus pandemic. In a detailed advisory to the heads of all <keyword id="6355548" type="UNKNOWN" weightage="20" keywordseo="Public-sector-banks">public sector banks</keyword>, the Department of Financial Services (DFS) said it was necessary that the banks take appropriate measures to ensure productive use of their financial resources for core business activities. The advisory also comes against the backdrop of <keyword id="62034" type="CITY" weightage="20" keywordseo="Punjab-National-Bank">Punjab National Bank</keyword> recently purchasing three <keyword id="6363321" type="COMPANY" weightage="20" keywordseo="audi">Audi</keyword> cars worth over Rs 1.30 crore for travel of its top executives. Banks are advised to defer avoidable expenditure beyond the current financial year, including purchase of staff cars, except where unavoidable, the advisory said. DFS has also directed the banks to postpone expenditure on decorative, non-functional items for the interiors in non-customer facing premises like administrative offices and back offices, and refurbishment of guest houses. Further, the banks have been asked to effect significant reduction in expenditure on activities other than those pertaining to core business activities. "Economy in expenditure to the tune of 20 per cent year-on-year or more may be effected on activities or heads of expenditure such as entertainment, publicity, by making efficacious use of social media and press releases, and pooling resources with other PSBs (Public Sector Banks) for common publicity campaigns where appropriate," it said. Besides, DFS has directed banks to avoid travel and adopt digital means of communication as well as make effective use of locally available administrative officers. "The bank board's executive committee/ management committee may review the composition of the existing fleet of vehicles engaged on hire, while taking into account functional imperatives and the profitability and the cost to income ratio of the bank's operations and the occupancy level of guest houses," the advisory said. DFS, which comes under the finance ministry, has asked banks to place the advisory before their respective boards and issue appropriate instructions internally. "Top management may also suitably sensitise senior executives to give effect to this advisory in letter and spirit," it said. In addition, DFS has directed banks for revision of entitlements and perquisites such as entitlements to fixed assets like vehicles and furniture and lease/ rent amounts admissible for hired residential accommodations. Amid the pandemic, the finance ministry has asked all ministries and departments not to initiate any new scheme in the current financial year. Earlier this month, the ministry said there was a need to use resources prudently in these difficult times. Schemes that have already been approved for the current financial year would remain suspended till March 31 next year or further orders. SEE ALSO: <a href="https://www.businessinsider.in/business/news/interest-rate-waivers-for-bank-loans-during-moratorium-will-harm-depositors-aibda/articleshow/76419600.cms">Interest rate waivers for bank loans during moratorium will harm depositors: AIBDA</a> <a href="https://www.businessinsider.in/finance/news/only-5-of-the-governments-msme-emergency-loan-package-is-disbursed-after-a-month/articleshow/76437386.cms">Only 5% of the government’s MSME emergency loan package is disbursed after a month ⁠— private banks are sitting tight</a> <a href="https://www.businessinsider.in/business/news/indian-companies-shifting-accounts-to-large-stable-banks-amid-covid-crisis-report/articleshow/76411271.cms">Indian companies shifting accounts to large, stable banks amid COVID crisis: Report</a>

PNB buying Audi cars for its execs is followed by government telling PSU banks to cut 'avoidable' expenses

<ul><li>Number of bad loans alone was close to $149 billion last year.</li><li> <keyword id="571991" type="ORGANIZATION" weightage="20" keywordseo="Nirav-Modi">Nirav Modi</keyword> and his uncle Mehul Choksi allegedly defrauded Punjab National Bank of over <a href="http://www.thehindu.com/business/Industry/all-you-need-to-know-about-nirav-modi-and-the-177-billion-pnb-fraud/article22753973.ece" data-type="tilCustomLink">₹1.77 billion</a>. </li><li>According to proxy advisory firm Institutional Investor Advisory Services (IiAS), in 2016-17 alone the Indian banking sector reported 12,553 frauds aggregating to Rs 181.7 billion. </li></ul> India’s already troubled banking sector is being demolished by the surging number of bad loans and/or bank frauds that are coming to light. Though this is not at all a new phenomenon, the Nirav Modi case has opened up a Pandora’s box full of dodgy transactions -- that typically involves cases where the borrower intentionally tries to deceive the lending bank and does not repay the loan -- that run in millions and even billions. As a result of which, the CBI is on an overdrive to nab these offenders. According to data from the Reserve Bank of India (RBI), accessed through a right-to-information request by a <a href="https://in.reuters.com/article/india-banks-fraud/exclusive-unpublished-data-shows-indias-fraud-problems-extend-far-beyond-pnb-idINKCN1G00SJ">Reuters</a> reporter, in the five financial years leading up to 31 March 2017 showed that state-run banks reported 8,670 “loan fraud” cases totalling ₹612.6 billion. And the number of bad loans alone was close to a whopping <a href="https://www.ndtv.com/india-news/unpublished-data-shows-indias-fraud-problems-extend-far-beyond-pnb-1813569" data-type="tilCustomLink">$149 billion</a> last year. According to proxy advisory firm Institutional Investor Advisory Services (IiAS), in 2016-17 alone the <a href="https://www.firstpost.com/business/frauds-cost-rs-18170-cr-in-12553-cases-to-banking-sector-in-fy17-advisory-firm-report-4411267.html">Indian banking sector reported 12,553 frauds aggregating to Rs 181.7 billion</a>. Here’s are of the biggest frauds that came to light in the past financial year. Kanishk Gold Pvt Ltd./consortium of 14 banks led by <keyword id="6354731" type="UNKNOWN" weightage="20" keywordseo="state-bank-of-india">State Bank of India</keyword> (SBI): Kanishk Gold Pvt Ltd. has been <a href="https://timesofindia.indiatimes.com/business/india-business/jewellery-chain-kanishk-gold-defrauds-14-banks-to-tune-of-rs-824-15-crore/articleshow/63394221.cms" data-type="tilCustomLink">accused</a> by a consortium of 14 banks led by SBI of defaulting on a loan of ₹8241.5 million. While the principal loan amount is about ₹8241.5 million, adding the interest due would indicate a loss of more than ₹10 billion. In a letter dated 25 January 2018 to the CBI, SBI charged Kanishk with "manipulating records, shutting shop overnight." Nirav Modi / <keyword id="6476298" type="UNKNOWN" weightage="20" keywordseo="Punjab-National-Bank">Punjab National Bank:</keyword> The all-too-famous case in which companies owned by billionaire jeweller Nirav Modi and his uncle Mehul Choksi allegedly defrauded India's second-biggest state-run bank of over <a href="http://www.thehindu.com/business/Industry/all-you-need-to-know-about-nirav-modi-and-the-177-billion-pnb-fraud/article22753973.ece" data-type="tilCustomLink">₹1.77 billion</a>, making it India's biggest detected loan fraud. Apparently, two junior officers at a single branch had illegally issued fraudulent “letters of undertaking” (a guarantee that a bank is obliged to repay the loan if the actual borrower fails) without any collateral to the accused. When the accused failed to pay up, the bank employees involved issued more LoUs on behalf of PNB, asking other banks to give out fresh loans to the firms. The Central Bureau of Investigation (CBI) registered the case on 31 January 2018. Vikram Kothari / consortium of 7 banks led by Bank of India: The CBI arrested <keyword id="5888255" type="COMPANY" weightage="20" keywordseo="Rotomac">Rotomac</keyword> owner Vikram Kothari and his family in the alleged “willful” loan default to the tune of ₹ 36950 million on 22 Feb 2018. As alleged, the case relates to bank loans <a href="https://thewire.in/banking/banking-sector-hit-second-scam-rs-3695-cr-rotomac-promoters-probed" data-type="tilCustomLink">worth ₹ 29190 million</a> from 2008 onwards taken by Mr Kothari’s companies from a consortium led by Bank of India and comprising Bank of Baroda, Indian Overseas Bank, Union Bank of India, Allahabad Bank, Bank of Maharashtra and Oriental Bank of Commerce. This amount inflated to ₹ 36950 million after including accrued interest, because of repeated defaults on payment. Dwarka Das Seth International Pvt Ltd / Oriental Bank of Commerce: On 24 February 2018, the CBI registered a case against Delhi-based diamond exporter, Dwarka Das Seth International Pvt Ltd, for an alleged <keyword id="77600" type="PERSON" weightage="20" keywordseo="bank-fraud">bank fraud</keyword> to the tune of <a href="https://economictimes.indiatimes.com/news/politics-and-nation/cbi-approaches-interpol-to-locate-promoter-of-dwarka-das-seth-jewellers/articleshow/63129931.cms" data-type="tilCustomLink">₹3898.5 million</a>. The company was supposedly using letters of credit (LoCs) to pay off other creditors against the purchase of gold and other precious stone and transfer gold and funds outside the country using fictitious transactions. The company was also engaging in business transactions with non-existent entities, it said. Totem Infrastructure Ltd / consortium of eight banks led by Union Bank of India: CBI arrested the promoters of Totem Infrastructure Ltd — Tottempudi Salalith and Tottempudi Kavita — on 23 March 2018 in connection with an alleged <a href="https://timesofindia.indiatimes.com/business/india-business/cbi-arrests-promoters-of-totem-infra-in-rs-1394-crore-fraud-case/articleshow/63433753.cms" data-type="tilCustomLink">₹13940 million</a> fraud perpetrated against a consortium of eight banks. They were also accused of using the funds that were loaned to them for purposes other than what they were meant for. Aircel promoter C Sivasankaran and more / IDBI Bank: The CBI on Thursday (26 April 2018) registered a case against 15 former and serving senior IDBI Bank officials along with 24 others including former Aircel promoter C Sivasankaran, the heads of two public sector banks — Melwyn Rego of Syndicate Bank and Kishor Kharat of Indian Bank — and former CMD of IDBI Bank M S Raghavanand in an alleged <a href="http://www.thehindu.com/business/Industry/idbi-bank-fraud-case-cbi-books-indian-bank-and-syndicate-bank-chiefs-aircel-founder/article23684141.ece" data-type="tilCustomLink">₹6-billion</a> bank fraud case. The CBI claims loans worth ₹3220 million and ₹5230 million were given to Sivasankaran’s two offshore companies – Axcel Sunshine Limited (British Virgin Islands) and Finland-based Win Wind Oy respectively – which turned non-performing assets.

Here are the biggest bank frauds that happened in India the previous financial year

New Delhi, Nov 18 () Punjab National Bank and Union Bank of India on Monday said they have received in-principal approval from the government for their amalgamation with other public sector banks.
"Bank has received a letter dated November 13, 2019 from Department of Financial Services, Ministry of Finance vide which bank has been advised that Alternative Mechanism (AM), has accorded in-principle approval to proposed amalgamation of Oriental Bank of Commerce and United Bank of India into Punjab National Bank," Punjab National Bank said in a regulatory filing.
Punjab National Bank is the transferee bank and Oriental Bank of Commerce and United Bank of India as transferor banks.
In a separate filing, Union Bank of India said, "The bank has received a communication from ministry of finance on November 16, 2019 stating that the alternative mechanism has accorded in-principle approval to proposed amalgamation of the Andhra Bank and Corporation Bank into Union Bank of India".
Union Bank of India is the transferee bank, and Andhra Bank and Corporation Bank are the trasferor banks.
The government in August had announced four major mergers of public sector banks, bringing down their total number to 12 from 27 in 2017, a move aimed at making state-owned lenders global sized banks.
According to this, United Bank of India and Oriental Bank of Commerce will be merged with Punjab National Bank, making the proposed entity the second largest public sector bank (PSB).
Syndicate Bank will be merged with Canara Bank Indian Bank will be merged with Allahabad Bank.
In January this year, the Union Cabinet had approved merger Dena Bank and Vijaya Bank with Bank of Baroda. The merger came in to effect from April 1.
With these mergers, the number of PSBs will come down to 12 from 27 in 2017.
Prior to this, the government had merged five associate banks of SBI and Bharatiya Mahila Bank with State Bank of India.
These were State Bank of Patiala, State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Travancore and State Bank of Hyderabad and also Bharatiya Mahila Bank effective April 2017. KPM NKD BAL

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Punjab National Bank's net profit more than doubles to ₹1,127 crore

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How one fraudster drove Punjab National Bank to the highest quarterly loss in the history of Indian banking

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PNB clocks 3-fold jump in net profit at ₹2,223 crore for Q3

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Honda India To Woo Customers Through Easy Retail Loans; Ties-Up With PNB

Purba Das

PNB buying Audi cars for its execs is followed by government telling PSU banks to cut 'avoidable' expenses

PTI

Here are the biggest bank frauds that happened in India the previous financial year

Kavita Majumdar

PNB, Union Bank get in-principal nod from govt for proposed merger

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