Fraud-hit PNB posts Rs. 13,420cr loss in Q4 of FY17-18

15 May 2018 | By Shiladitya Ray
PNB's Q4 results do not look good

On Tuesday, the fraud-hit Punjab National Bank (PNB) reported a massive net loss of Rs. 13,419.91cr in Q4 of FY17-18.

Interestingly, PNB had posted a net profit of Rs. 261.90cr in the corresponding quarter of the last fiscal.

Following the publication of the results, PNB shares fell by 6%.

Here's how Nirav Modi's alleged fraud affected PNB's operations.

In context: PNB's Q4 results do not look good

15 May 2018Fraud-hit PNB posts Rs. 13,420cr loss in Q4 of FY17-18

It's been a really rough year for PNB

As of Monday, PNB shares had tumbled by 44% since the discovery of the fraud, and PNB stock is the worst performer among all Indian bank stocks this year.
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PNB's performance took a significant hit owing to the fraud

Impact of fraudPNB's performance took a significant hit owing to the fraud

For Q4, PNB saw its total provisions increase three fold compared to last fiscal to Rs. 20,353cr. Of this amount, Rs. 7,178cr was due to the fraud involving Nirav Modi, Mehul Choksi and associates.

Additionally, gross bad loans as a ratio of total loans spiked to 18.38% in end-March, compared to 12.11% in Q3 FY17-18, and 12.53% in the fourth quarter of last fiscal.

LoU/FLC paymentsPNB's liabilities on account of LoUs and FLCs

In the quarterly results, PNB said that liabilities on account of letters of undertaking (LoUs) and foreign letters of credit (FLCs) amounting to Rs. 6,586.11cr had been paid off.

Additionally, PNB also said that it had created liabilities in its books with respect to LoUs and FLCs due after 31st March, amounting to Rs. 6,959.79cr. PNB will pay these off by their due dates.

CBI chargesheetCBI named several top PNB officials as co-conspirators

PNB's results come a day after CBI named 22 people in its chargesheet pertaining to the Nirav Modi fraud case.

Some former and current PNB officials, including former MD and CEO Usha Ananthasubramanian, were named.

Apart from "misrepresenting" the factual position of the fraudulent LoUs in the case, the CBI alleged that Ananthasubramanian and associates failed to prevent the fraud despite knowing about it.