JK Bank clarifies, says it has avoided additional exposure to ‘Gitanjali Gems’

Srinagar: The Jammu and Kashmir Bank on Thursday clarified that it has consciously avoided additional exposure in ‘Gitanjali Gems’ headed by Nirav Modi.

“The bank had during its clean up and consolidation drive year and a half ago reckoned the account as a stressed account and consciously avoided additional exposure in the company,” a spokesman of the bank said here.

He said that in respect of news item appearing in some sections of media, the 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.

The bank, added the spokesperson, however was having a business account of M/S Gitanjali Gems in its ‘Fort Business Unit’ since 2012 wherein the bank had sanctioned a working capital loan of Rs 121 Cr under a consortium arrangement of 31 Banks led by ICICI Bank. J & K Bank’s share in the total loan facilities of Rs 5198 Cr by the consortium was 2.33%.

“In the wake of recent developments of the company with PNB, 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/statutory payments. Acting swiftly JK 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,” the spokesman said.

The spokesperson of the bank categorized any other information regarding the matter in some sections of media as ‘factually incorrect’.  


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