New Delhi: Twenty-one public sector banks have lost a total of Rs 25,775 crore due to banking frauds in 2017-18, a Right to Information (RTI) reply has revealed. It comes as no surprise that scam-hit Punjab National Bank (PNB) incurred the highest loss of Rs 6,461.13 crore due to different cases of fraud.
Chandrasekhar Gaud, who filed the RTI with the Reserve Bank of India, told PTI that the RBI in its reply on May 15 did not specify details of any particular case of banking fraud.
One of the biggest banking frauds to the tune of Rs 14,400 crore allegedly involving diamond merchants Nirav Modi and Mehul Choksi and PNB officials is being investigated by the Central Bureau of Investigation. The investigating agency has filed two chargesheets in the special CBI court in Mumbai in connection with the Punjab National Bank scam.
The RTI reply stated that the State Bank of India incurred losses of Rs 2,390.75 crore due to various cases of banking fraud.
In the given period, the Bank of India incurred a loss of Rs 2,224.86 crore, Bank of Baroda's losses stood at Rs 1,928.25 crore, Allahabad Bank at Rs 1,520.37 crore, Andhra Bank at Rs 1,303.30 crore and Uco Bank at Rs 1,224.64 crore.
Post the detection of PNB fraud in February and subsequent unearthing of other similar cases and wilful defaults have created a domino effect. Both the finance ministry and the Reserve Bank of India has been tightening the noose on the state-owned banks with greater scrutiny and stringent norms. For example, (1) Asking banks to examine all NPAs above Rs 500 million for frauds, or (2) identify & resolve any operational and technical risks in the system within 15 days and so forth.
The RBI governor in a speech in March had hit back at the government that had criticised the inability of the central bank in detecting the fraud at Punjab National Bank. The Reserve Bank of India governor Urijit Patel said that banking regulatory powers in India ‘are not ownership neutral and called for legal reforms to empower the central bank.
The RTI reply informed that the IDBI Bank incurred losses of Rs 1,116.53 crore, Union Bank of India had losses of Rs 1,095.84 crore, Central Bank of India of Rs 1,084.50 crore, Bank of Maharashtra of Rs 1,029.23 crore and Indian Overseas Bank had incurred a loss of Rs 1,015.79 crore.
The RBI has clarified in the RTI that only those cases of fraud, involving a sum of over Rs one lakh, were included in the list. It, however, did not disclose the numbers of cases or the nature of fraud.
Other banks, as per the RTI, that faced losses due to fraud during this period were Corporation Bank with a loss of Rs 970.89 crore, United Bank of India with Rs 880.53 crore, Oriental Bank of Commerce with Rs 650.28 crore and Syndicate Bank with Rs 455.05 crore.
Canara Bank at Rs 190.77 crore, Punjab and Sind Bank at Rs 90.01 crore, Dena Bank at Rs 89.25 crore, Vijaya Bank at Rs 28.58 crore and Indian Bank at Rs 24.23-crore made up the rest of the list provided by the Reserve Bank of India as part of its RTI reply.