Punjab & Sind Bank (PSB) said on Wednesday it has reported a Rs 238 crore ($34.58 million) fraud to the country’s central bank, relating to allegations of diversion of funds by the indebted Bhushan Power & Steel Ltd.
Earlier this month, Punjab National Bank (PNB) said it had reported a borrowing fraud of Rs 3805 crore in Bhushan Power’s account to the Reserve Bank of India (RBI).
Both these banks are among a host of financial creditors who have claimed a collective Rs 47,303 crore from Bhushan Power, which the RBI referred to a bankruptcy court in 2017.
It has been observed that the company has misappropriated bank funds, manipulated books of accounts to raise funds from the consortium of lenders, New-Delhi based PSB said in a statement on Wednesday.
The case is currently at the country’s company law tribunal and the bank expects good recovery, it said.
State-owned PSB also said it has made provisions amounting to Rs 189 crore relating to its exposure to the Bhushan Power account.
Source: Business Standard