No direct exposure to Nirav Modi firms: JK Bank

Srinagar, Feb 22: Jammu and Kashmir Bank today said it had “no direct exposure” to the companies of Nirav Modi and was not affected by the fraudulent Letters of Undertaking (LoUs) issued by the Punjab National Bank.
“The (Jammu and Kashmir) Bank had no direct exposure to the Nirav Modi Group companies and was not affected by any fraudulent Letters of Undertaking (LoU) issued by the Punjab National Bank,” a spokesman of the bank said in a statement here.
The bank, however, was having a business account of Gitanjali Gems in its business unit at Fort in Mumbai since 2012 wherein the bank had sanctioned a working capital loan of s 121 crore under a consortium arrangement of 31 banks led by ICICI bank, the spokesman said.
He said the J&K Bank’s share in the total loan facilities of s 5,198 crore by the consortium was 2.33 per cent.
In the wake of recent developments surrounding Gitanjali Gems, the spokesman said the consortium recently discussed and agreed that banks may individually decide to recall the facilities and may also freeze all the accounts except for allowing few mandatory and statutory payments.
“Acting swiftly J&K Bank has already initiated freeze on all debits in the account of Gitanjali Gems Limited and issued recall notice to the company which will be followed by legal action,” he said.
Reacting to media reports, the spokesman said any other information regarding the matter in some sections of media is factually incorrect.
“The bank had during its clean up and consolidation drive 18 months ago reckoned the account as a stressed account and consciously avoided additional exposure in the company,” he added. (Agencies)