Hyderabad : State-owned Bank of India (BoI) has an exposure of Rs 200 crore in the Punjab National Bank (PNB) fraud case and the public sector lender has initiated insolvency proceedings against Nirav Modi firms, said a top official of the bank.
“We have some exposure (in the PNB fraud case). We are participating in the resolution process. It (exposure) was around Rs 200 crore. We are participating in the insolvency process in overseas also,” Dinabandhu Mohapatra, Managing Director and CEO of BoI said.
“Let’s hope for the best,” he said. The Centre has also intervened in the bankruptcy proceedings of Nirav Modi firms in the US to protect the interests of PNB.
Mohapatra said the bank’s profitability was hit during the October-December quarter largely due to higher provisioning to some of the large accounts that were downgraded by RBI. During the Q4, the bank recovered about Rs 9,000 crore of the non-performing assets (NPA) and was hopeful of better results during the current financial year, he added.
BoI reported a net loss of Rs 2,341.10 crore during the third quarter ended December 31, as provisioning for bad loans rose 72 per cent due to high NPA ratio. NPAs grew to 16.93 per cent of the gross loans by end of December 2017 from 13.38 per cent from December end 2016. Net NPAs were 10.29 per cent against 7.09 per cent.
“We did well in June and September quarters (of last fiscal). Then in December quarter some accounts of March 17 were downgraded by RBI. We have recovered around Rs 9000 crore of NPAs that were downgraded during the inspection,” he said.
“That’s a good sign. It will help us in managing NPA’s position,” he added.
According to him, BoI is one of the few banks which have 65 per cent of provisional coverage ratio.