STOCK MARKET BSE NSE

SBI shares hit 52-week low after Rs 824 crore Kanishk fraud alert

Following reports about a fresh Rs 824 crore loan fraud, shares of State Bank of India (SBI) hit a 52-week low at Rs 240.65 on NSE.

Published: 23rd March 2018 05:02 AM  |   Last Updated: 23rd March 2018 05:38 AM   |  A+A-

For representational purposes (File | Reuters)

By Express News Service

MUMBAI: Following reports about a fresh Rs 824 crore loan fraud, shares of State Bank of India (SBI) hit a 52-week low at Rs 240.65 on NSE on Thursday. Its previous low was Rs 241.15 in October last year.
A consortium of 14 banks have reportedly lent to Chennai-based Kanishk Gold Pvt Ltd. SBI, the lead banker, has filed a case alleging mismanagement and falsification of accounts.

The Central Bureau of Investigation (CBI) has registered a case based on the complaint, where SBI alleged of a Rs 824 crore fraud. Though SBI’s individual exposure was about Rs 215 crore, the security available with it to cover the loss was only around Rs 156 crore, which sent the stock downwards on Thursday. The saving grace is that the company’s accounts were declared fraud and NPA in 2017-18 by various lenders.

As per the complaint, the loan accounts of the company were taken over by the SBI from the ICICI in 2008, while its banking arrangement was converted into a multiple banking system in March, 2011. SBI also alleged that the company had misrepresented and falsified its records and financial statements to show a rosy picture since 2009 to avail credit facilities.

Kanishk Gold and its directors allegedly diverted the funds detrimental to the rights and interests of the bank, SBI said, adding that the agency should register a case against Kanishk Gold, its promoter director Bhoopesh Kumar Jain and others.

Kanishk Gold was in the business of gold jewellery manufacturing, marketed under the brand name ‘Krizz’, and sold through distributors till 2014. In 2015, it changed its business model to B2B and started supplying to large retail jewellers, SBI said in its complaint.



Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp