PNB Flags ₹2,400 Crore SREI Fraud Case

Punjab National Bank (PNB) shares are likely to attract attention when the stock market opens on Monday after the bank disclosed a large fraud case late on Friday.

In a regulatory filing made after market hours on December 26, the state-owned bank said it has identified a borrowing fraud of over ₹2,400 crore linked to the former promoters of two companies from the SREI Group. The fraud amount includes ₹1,240.94 crore related to SREI Equipment Finance Ltd (SEFL) and ₹1,193.06 crore linked to SREI Infrastructure Finance Ltd (SIFL).

PNB clarified that it has already made full (100 per cent) provisions for the entire outstanding amount in both accounts. This means the bank has already set aside money to cover the losses.

The bank also said that both SREI companies have been successfully resolved under the Corporate Insolvency Resolution Process (CIRP) through the National Company Law Tribunal (NCLT).

On Friday, PNB shares closed slightly lower, down 0.50 per cent at ₹120.35 on the BSE. Despite the small dip, the stock has performed well over the longer term, rising nearly 13 per cent in the last six months and over 17 per cent so far in 2025.

Technical indicators show the stock is currently in a neutral range. Data from Trendlyne shows the Relative Strength Index (RSI) at 50.8 and the Money Flow Index at 55.4, suggesting the stock is neither overbought nor oversold.

The fraud case involves the SREI Group, which has been active in infrastructure and equipment financing for decades. SREI Infrastructure Finance Ltd began operations in 1989 and later expanded into wider infrastructure lending. It was recognised as a public financial institution in 2011.

Earlier, PNB had reported strong financial results for the September quarter, with net profit rising 14 per cent year-on-year to ₹4,904 crore. The bank’s provisions during the quarter stood at ₹643 crore, higher compared to both the previous quarter and the same period last year.