Bank of Baroda shares slide after $15B lawsuit
What's the story
Bank of Baroda's shares plummeted by almost 4% to 229.80 in today's session, making it one of the biggest losers on the Nifty 100 index. The fall came after NMC Healthcare founder BR Shetty filed a $15 billion (around ₹1.44 lakh crore) damages lawsuit against the public sector lender and 25 other defendants in the Bombay High Court. Bank of Baroda has vowed to defend itself vigorously against these claims.
Lawsuit details
Shetty's lawsuit accuses bank of facilitating fraudulent transactions
Shetty's lawsuit accuses Bank of Baroda and some of its officials of facilitating fraudulent transactions involving his group companies.
The petition claims $5 billion each in direct damages, consequential damages such as lost business opportunities, and compensation for alleged reputational damage.
He has also sought 18% annual interest on the claimed damages.
The petition alleges that the bank facilitated fund diversion through accounts linked to purported suppliers, failed to adequately investigate anti-money-laundering alerts, and allowed unauthorized transactions.
Forgery allegations
Shetty has sought disclosure of banking records, internal compliance documents
Shetty has also claimed that personal guarantees bearing forged signatures were used to secure loans and pursue liabilities against him.
He has sought disclosure of banking records and internal compliance documents in the case.
However, it's worth noting that these allegations have not been established by a court yet.
Bank of Baroda said it was pursuing recovery proceedings against Shetty in India and UAE for outstanding dues of around ₹2,800 crore.
Past cases
Similar lawsuit filed by Shetty in New York dismissed
Notably, a similar lawsuit filed by Shetty in New York was dismissed in July 2024.
Bank of Baroda also noted that judgment was reserved in proceedings against Shetty and former NMC executive Prashant Manghat before the Abu Dhabi Global Market Court concerning fraud, wrongful trading, and fraudulent trading allegations.
The new lawsuit comes just over three months after Bank of Baroda agreed to pay $600 million (around ₹5,700 crore) to settle litigation with NMC group companies.