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PNB scam: Bank assures it has strong sovereign backing, adequate capital

The country's second largest lender has also dismissed media reports that it has imposed restrictions on withdrawals

Press Trust of India  |  New Delhi 

File photo: Reuters

Scam-hit PNB has assured investors and customers that it has a strong sovereign backing and adequate capital to deal with the situation in the aftermath of the Rs 114 billion

"We assure you that in your bank, it is business as usual," state-owned said in a tweet.

The country's second largest lender has also that it has imposed restrictions on withdrawals.

"Be rest assured we have a strong sovereign backing. The core strengths of the is the brand image with rich 123 years of existence, strong CASA base, stable asset quality and increased pace of digitisation," PNB said.

Earlier this month, the said that it has been hit by a amounting to about $1.77 billion. The alleged was affected by fraudulent Letter of Undertakings (LOUs) issued to firms of diamantaire and

"We have adequate capital coupled with strong non core asset base," said the PNB tweet as multi-agency probe widened into the fraud.

PNB also said that it has the capacity and capability to "handle the situation" and protect the interest of the institution.

"Some like restrictions on withdrawals etc is floating in some channels. It has been created by some miscreants and is totally baseless," the PNB added.

Bank's scrips closed almost flat on benchmark

International Moody's Investor Service and yesterday warned PNB of rating downgrades, citing likely networth erosion and widening losses at the bank.

Moody's said the review for downgrade will focus on: (1) the timing and quantum of the financial impact of the fraudulent transactions, (2) any management actions taken to improve the capitalisation profile of the bank, and (3) any punitive actions taken by the regulator on the bank.

First Published: Wed, February 21 2018. 16:15 IST