Home >Companies >News >Canara Bank says exposure to Transstroy consortium lending at 678 cr
(Photo: Mint)
(Photo: Mint)

Canara Bank says exposure to Transstroy consortium lending at 678 cr

On Friday, the CBI booked the Hyderabad-based firm and its directors for alleged bank fraud of over 7,926 cr to a consortium led by Canara Bank

Mumbai: State-run Canara Bank on Saturday said its exposure to Transstroy India Ltd is 678.28 crore under a consortium lending arrangement and the borrower was declared a wilful defaulter earlier in 2018.

Canara Bank said in a regulatory filing that the bank's exposure to the Transstroy India is of 678.28 crore contrary to news claiming it to be an alleged fraud of 7,926 crore. "In this regard, it is clarified that the company was enjoying limits from various banks under multiple banking arrangement from 2001. Subsequently, a consortium with Canara Bank as leader with 13 other banks was formed in 2013 and the total limit sanctioned was 4,765.70 crore and the share of Canara Bank is only 678.28 crore," it said.

"The case was referred to NCLT and was admitted by NCLT, Hyderabad on 10 October 2018. The company is under the process of liquidation," it said further. The company was engaged in building infrastructure across various sectors including, ports, bridges, oil and gas, power and mining, as per its website that also informs about the ongoing liquidation process.

The Bengaluru-headquartered lender said that the account was declared as fraud and reported to the RBI on 10 February 2020.

"Canara Bank has made 100 per cent provision for this account as per the prescribed prudential norms. The company has already been declared as wilful defaulter on 26 December 2018 by our Bank," it said.

Remaining amount was lent under multiple banking arrangement, Canara Bank added.

The CBI has booked Hyderabad-based Transstroy (India) Ltd and its directors for alleged bank fraud of over 7,926 crore in a consortium led by Canara Bank, in the biggest banking scam in the country so far surpassing the amount misappropriated by diamantaire Nirav Modi, officials said on Friday.

Shares of Canara Bank fell 1.93% to close at 121.70 on Friday on BSE, while the benchmark index, Sensex gained 0.15% to close at 46,960.69 points.

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