PNB Convenes EGM For ₹5,473-cr Capital Infusion By Government

The ₹11,300-crore Nirav Modi Group and Mehul Choksi Group perpetrated fraud has not deterred scam-hit Punjab National Bank (PNB) from going ahead with the planned ₹5,473 crore capital-raising from the government on preferential-issue basis.

This state-owned bank — government holds 57.04 per cent stake — has convened an extraordinary general meeting of shareholders on March 16 to seek approval for issue 33.49 crore shares of ₹2 each at a premium of ₹161.38 per share, garnering an amount of ₹5,473 crore through preferential issue to the government.

The proposed issue price of ₹163.38 per share is substantially higher than the Thursday closing price of ₹114.65 per share at the BSE.

The EGM will happen at the PNB head office in the Capital, sources said. After the proposed capital infusion, the Centre’s stake in PNB will go up to 62.25 per cent. The equity shares that are to be allotted to the government will have a three-year lock-in period from the date of trading approval.

Meanwhile, the Enforcement Directorate on Thursday tweeted that it has seized nine luxury cars, including Rolls Royce Ghost, Porsche Panamera, two Mercedes Benz cars, three Honda cars, one Toyota Fortuner and an Innova of Nirav Modi and his companies.

Shares and mutual funds worth ₹7.8 crore of Nirav Modi and ₹86.72 crore of the Mehul Choksi group have also been frozen, said the ED tweet.

Meanwhile, to a query from the bourses on the aspect of Nirav Modi’s contention that PNB has closed all option to recover dues by going public, PNB replied: “We have followed lawful avenues available to us as per law of the land to recover our dues.”

On the impact of the event (fraud) on the financials and operations of the bank, PNB said the bank has enough assets/capital to meet any liability which is decided as per law.

Staff transfer

PNB on Thursday said that it had transferred 257 sub-staff, 437 clerks and 721 officers (total 1,415 employees) since February 19 as per the prevailing rotational transfer policy of the bank.

Work at the bank’s branches is going on smoothly and the above transfers are in no way affecting the customer service in the bank, PNB said.