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IDBI Bank discloses ₹772 crore loan fraud, sends shares falling
Soam of the fraudulent loans, issued during fiscal years 2009-2013 for fish farming businesses, were obtained against fake lease documents of non-existent fish ponds and by inflating the value of the collateral.
IDBI Bank Ltd said fraudulent loans worth ₹772 crore were issued from five of its branches in Andhra Pradesh and Telangana on Tuesday night, sending its shares spiraling down on Wednesday.
Some of the loans, which were issued during fiscal years 2009-2013 for fish farming businesses, were obtained against fake lease documents of non-existent fish ponds and by inflating the value of collateral, the company said.
The bank found major lapses in processing and disbursing the loans by two of its officials. The lender dismissed one of the officials, while the other official had already retired, it said.
The Central Bureau of Investigation (CBI) has registered cases for two of the five complaints, relating to branches at Basheerbagh and Guntur, IDBI said.
Read: CBI lodges case in another bank fraud involving ₹445 crore
The bank said earlier on Tuesday it initiated a quality assurance audit, expected to be completed by April.
IDBI shares fell as much as 3.5% to ₹73.6 rupees by 10.45 am, while Nifty PSU Bank index dropped as much as 1.8%.
