Kolkata: State-run Allahabad Bank on Friday said it has an outstanding exposure of about $366.87 million in the $1.8 billion fraud detected by another public sector bank PNB, but added it was confident of receiving the payment.
Meanwhile, other public sector banks Union Bank of India and State Bank of India have reported $366.87 million and $212 million outstanding exposure respectively.
"The outstanding exposure related to the incident is approximately $366.87 million and the bank is fully secured by LoU documents and fully confident to receive the payment," it said in regulatory filing.
The lender said it, through its overseas branch in Hong Kong, has been taking exposure with PNB as counter party under various LoUs issued through authenticated SWIFT message. An LoU is in effect a guarantee issued by one bank to the branches of other banks, based on which foreign branches offer credit to buyers.
The bank has also purchased some buyers' credit assets from Axis Bank extended against PNB LoU through risk participation as a part of normal international business practice.
"We wish to inform you that the bank through our foreign branches has been taking exposure with Punjab National Bank (PNB) as counterparty under various Letters of Undertakings (LoU) issued through authenticated SWIFT message," Union Bank of India said in late night filing to stock exchanges.
The bank has also purchased some Buyers Credit assets from Axis Bank through Risk Participation as a part of normal International Business Practice, it said. "The outstanding exposure related to the incident is approximately $300 Million and the Bank is fully secured by LoU /LC /Other documents and fully confident to receive the payment," it said.
We don't have any direct exposure on Nirav Modi but we do have some exposure on Punjab National Bank, State Bank of India Chairman Rajnish Kumar told reporters here.
He said the bank has lent $212 million to Modi on the basis of LoU issued by PNB.
Kumar, however, said the bank has some exposure to Gitanjali Gems.