Punjan National Bank (PNB) shares opened red at Rs 116.60 apiece on Monday, December 29, after the lender reported a borrowing fraud of Rs 2,434 crore to the Reserve Bank of India involving the erstwhile promoters of SREI group companies.

The scrip was trading at Rs 120.23 apiece from the previous day close at Rs 120.37 apiece. 

Punjab National Bank informed stock exchanges that it has reported borrower frauds linked to SREI Equipment Finance Ltd (SEFL) and SREI Infrastructure Finance Ltd (SIFL), in line with regulatory requirements.

In a regulatory filing, the bank said the total fraud amount reported stands at Rs 1,240.94 crore for SEFL and Rs 1,193.06 crore for SIFL. Importantly, the lender clarified that it has already made 100% provision for the entire outstanding amount in both cases.

The disclosure was made to exchanges following reporting to the Reserve Bank of India.

The Reserve Bank of India, in October 2021, superseded the boards of SIFL and its wholly-owned subsidiary SEFL. The Kolkata-based Kanorias previously controlled the twin companies, SIFL and SEFL, until the RBI superseded their boards over alleged mismanagement and subsequently initiated IBC proceedings.