Scam-hit Punjab National Bank (PNB) has received a warning from the Securities and Exchange Board of India (SEBI) for alleged delay in disclosing the fraudulent transactions related to Nirav Modi and Gitanjali Gems and also the complaints made by the bank to regulatory and investigation agencies in the matter.
‘Ensure compliance’
“The... non-compliances are viewed seriously and PNB is hereby warned and advised to be cautious in future to ensure compliance with all applicable provisions of the SEBI LODR Regulations,” the capital markets regulator stated in a letter written to PNB’s company secretary on May 15.
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LODR refers to the Listing Obligations and Disclosure Requirements Regulation of SEBI which every listed entity has to comply with.
PNB, which is the second largest lender after State Bank of India (SBI), released a copy of the letter as part of a stock exchange announcement on Thursday.
In its letter, SEBI highlighted the fact that there was a delay of 1-6 days by the bank in making disclosures related to the complaints filed with the Reserve Bank of India (RBI) and the Central Bureau of Investigation (CBI).
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The capital markets regulator further said that the public sector lender “has not made any provision/disclosure with respect to fraud of ₹280 crore in the financial statements for the quarter ended December 2017.”
The warning by the regulator came after it “examined various events and disclosures by PNB to the stock exchanges from the point of appropriate disclosures to be made and other requirements to be complied with under” SEBI regulations.
The capital market regulator has sent a copy of the letter to the RBI as well.
In a separate development, Crisil revised the outlook of various debt instruments of PNB while retaining the rating. The instruments which were earlier placed on ‘rating watch with developing implications’ saw the outlook changed to ‘rating watch with negative implications.’