Punjab National Bank (PNB) has gone down over 7.5% today to Rs.151 and continues to trade in the red.

The Bank reported its Q3FY18 numbers and they were good. Net profit was up 11% (YoY) at Rs.230 crore but this was way below what most analysts had expected. NII was up 7% at Rs.3989 crore.

On the asset quality front, Gross NPA improved from 13.3% to 12.1% (QoQ) while Net NPA too did better at 7.5% v/s 8.4%.

But this improvement in asset quality sounds very hollow as we read today’s news that it has come across a suspected fraud amounting to Rs.280.70 crore involving one branch wherein certain irregularities have been observed on account of people risk. This pertains to a fraud by jeweler, Nirav Modi.

The CBI has registered 22 cases against certain officials, including Chief Managers of Punjab National Bank relating to four branches at Bhopal and Ujjain (Madhya Pradesh) and other accused, on a complaint from the bank.