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PNB responds to Nirav Modi letter, says followed laws to recover dues

Earlier this week, in a letter, Nirav Modi had alleged that Punjab National Bank’s overzealousness had shut the doors on his ability to clear dues

business Updated: Feb 22, 2018 18:44 IST
Remya Nair
Remya Nair
Livemint, New Delhi
Punjab National Bank,Nirav Modi,Nirav Modi letter
People walk past as CBI team seals Punjab National Bank’s South Mumbai branch at Brady House in Mumbai on Monday.(PTI Photo)

Responding to Nirav Modi’s claims about the bank closing all recovery options, Punjab National Bank on Thursday said it has followed lawful avenues to recover its dues.

In a regulatory filing, it also said it has enough assets and capital to meet any liabilities arising from the fraud.

Last week, PNB reported a Rs 11,400 crore fraud involving jewellers Nirav Modi and Mehul Choksi and their group firms and some errant bank employees.

Earlier this week, in a letter, Modi had alleged that PNB’s overzealousness had shut the doors on his ability to clear the dues. He had also said that the money he owed banks was less than Rs 5,000 crore and not what was publicised. He had also blamed the bank and its “anxiety to recover dues immediately”, for destroying his brand and business and closing all options for a possible repayment of dues.

In a clarification to the stock exchanges about the letter, PNB said, “We have followed lawful avenues available to us as per law to recover our dues.”

The bank also sought to assuage the concerns of investors and customers about the impact of the fraud on the financials and operations of the bank.

“We have enough assets/capital to meet any liability which is decided as per the law,” the bank said.

The bank had a capital adequacy ratio of 11.58% as of December end. It will get an additional Rs 5,473 crore as capital from the government in the quarter ending March.

It also has huge real estate holdings that it plans to monetize. It also has joint ventures in the insurance and mutual funds space which it can completely or partially exit depending on its requirements.

At 2.55pm, PNB’s shares were down 1.3% to Rs 115.55.

First Published: Feb 22, 2018 16:00 IST