PNB trades in red after reporting fraud of Rs3,688.58cr in DHFL account; Latter's stock dips 4%

Provision Coverage Ratio also improved to 77.79% in FY20 from 74.50% of the previous fiscal.

Jul 13, 2020 10:07 IST India Infoline News Service

Stocks In Focus
State-owned Punjab National Bank (PNB) and Dewan Housing Finance (DHFL) both were trading in red on Sensex during Monday's trading session, with the latter witnessing huge sell-offs. The reason behind investors sentiment would likely be PNB reporting fraud worth Rs3,688.57cr in the NPA account of DHFL.

In a filing to exchange, PNB stated that, "This has reference to our letter dated 09.07.2020, reporting a Borrowal Fraud of Rs3,688.58 Crore in the NPA account of Dewan Housing Finance Ltd. (DHFL) at Large Corporate Branch at Mumbai, Zonal Office, Mumbai".

"Due to this, PNB's provision figure is now to be read Rs1,695.73cr instead of Rs246.58cr", said the lender.

At around 10.06 am, the PNB stock was performing at Rs35 per piece down by 0.14% on Sensex. The stock even clocked an intraday low and high of Rs34.80 per piece and Rs35.50 per piece, respectively.

Meanwhile, the DHFL stock was trading at Rs14.40 per piece, lower by 3.68% on Sensex. The stock has also touched an intraday high and low of Rs14.90 per piece and Rs14.30 per piece, respectively.

PNB has presented its FY20 annual report on July 12, the bank said, "Improvement in asset quality continues to be one of the top priorities for the bank".

As of March 2020, PNB's gross NPA ratio improved to 14.21% compared to 15.50% as of March 2019. Provision Coverage Ratio also improved to 77.79% in FY20 from 74.50% of the previous fiscal. 

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