PNB slumps 5% as Fitch puts bank on rating watch; Gitanjali Gems cracks for 6th day

NEW DELHI: Shares of Punjab National Bank (PNB) slumped nearly 5 per cent in Tuesday's trade after rating agency Fitch put the lender on 'Rating Watch Negative' (RWN), raising chances of a possible downgrade for the bank in the near future.

The news came at a time when Nirav Modi, involved in a Rs 11,400 crore fraud, said that the lender has closed all options to recover dues by going public.

Shares of Gitanjali Gems owned by Modi's maternal uncle Mehul Choksey too fell for a sixth straight day after PNB asked the group to pay dues worth Rs 1,045 crore.


However, shares of PNB rebounded and closed 0.13 per cent up at Rs 116.55 on BSE. Gitanjali Gems on the other hand, hit its lower circuit limit of 10 per cent at Rs 30.45, eventually closing at the same level.

The fraud-- the biggest ever in the banking history-- has raised questions on both internal and external risk controls as well as the quality of management supervision considering that the fraud went undetected for several years, Fitch said.