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Fraud claims cause UCO Bank shares to slip

Author: IANS/Tuesday, April 17, 2018/Categories: Banking & Financial Services

Fraud claims cause UCO Bank shares to slip

Mumbai/Kolkata, April 16 - Shares of public sector lender UCO Bank on April 16 plunged to almost a 12-year low on the stock exchanges following the ongoing probe into an alleged multi-crore loan fraud case.

During the day's trade, shares of the bank on the BSE slipped by 14.32% to hit a new 52-week low of Rs 19.15 per share -- the lowest level since September 2006.

Shares of the state-run bank closed at Rs 20.90 per scrip -- down 6.49% -- from its previous session's close.

On the NSE, the bank's shares hit the lowest since August 2006.

It nosedived by 17.98% to a fresh 52-week low of Rs 18.25 per share. On a closing basis, the shares declined by 6.29% and closed at Rs 20.85 per scrip.

The state-run lender filed a complaint with the Central Bureau of Investigation (CBI) on April 11, 2018, against Era Infra Engineering Ltd in view of irregularities reported in their accounts with the bank.

"With regard to material impact, we inform that as on March 31, 2018, the Era Infra Engineering Ltd has a total exposure of Rs 757.53 crore in our bank. The account was categorised as non-performing asset since July 1, 2013 onwards," the UCO Bank said in a regulatory filing on Monday.

The lender also said the bank is holding 100% provision against the account and that there is no additional material impact.

The CBI officials had on Sunday said they would soon question the bank's former Chairman and Managing Director (CMD) Arun Kaul in connection with its ongoing probe into the loan fraud case.

Earlier, the agency had filed a case against Kaul, Era Engineering Infra India (EEIL), its CMD Hem Singh Bharana, two chartered accountants -- Pankaj Jain and Vandna Sharda -- and Pawan Bansal of Altius Finserve, among others, in connection with the alleged Rs 621 crore loan fraud which caused a loss of over Rs 737 crore to the bank.

The accused persons had hatched a criminal conspiracy and allegedly defrauded the UCO Bank of about Rs 621 crore by diversion and siphoning off two bank loans.

According to the CBI officials, Kaul, who was the CMD of UCO Bank between 2010 and 2015, had allegedly facilitated the accused company in obtaining the loan.

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Kavita Giridhar Mallya

IANS

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