Corp Bank to write off Rs 532-cr loan to REI Agro

State-run Corporation Bank on Tuesday said it will technically write-off a Rs 532-crore loan given to REI Agro, under the CBI scanner for alleged loan fraud, in the December quarter after making full provisions.

Last month, the Central Bureau of Investigation (CBI) had registered a case against Basmati rice exporter REI Agro on the basis of a complaint filed by a consortium of bankers.

The consortium, led by UCO Bank, alleged that the company had defrauded them to the extent of Rs 3,815 crore since 2013 through conspiracy, cheating and forgery.

Corporation Bank Chairman and Managing Director S R Bansal said the lender had already categorised the account as fraud and has been making provisions for it since January last, as per the regulatory requirement.

"We have been making provisions for the account for the past three quarters... The December quarter will be the last one and then we will just technically write-off the account," Bansal told reporters here after launching the bank's institutional broking services through its wholly-owned subsidiary CorpBank Securities.

He said the bank has an exposure of Rs 532 crore to the Delhi-based company, which is registered in Kolkata.

Regarding taking action against the company, Bansal said the PSU lender has given its consent to the lead bank, which is taking action on behalf of all the consortium members.

In the last week of October, CBI had conducted searches at four premises of the company and its directors in Kolkata.

The central agency also searched three rice processing units of REI Agro at Rewari in Haryana.