OBC slumps 10% after two back-to-back fraud cases

NEW DELHI: Oriental Bank of Commerce (OBC) declined over 10 per cent on Monday after the lender approached the CBI with a complaint of Rs 390 crore fraud against Delhi-based jewellery exporter Dwarka Das Seth International.

Besides, the investigative agency has registered a case against Ghaziabad-based Simbhaoli Sugars on charges of causing a loss of about Rs 110 crore to the state-owned bank.


The stock reacted sharply to these developments and fell 10.02 per cent to Rs 95.15 on the BSE.

The bank said it had sanctioned a loan of Rs 148.60 crore to Simbhaoli Sugars in 2011 under an RBI scheme for financing individual, joint liability groups (JLG) and self help groups (SHGs) of 5,762 sugarcane farmers. The lender claims that the company dishonestly and fraudulently diverted the loan for its own needs.