Allahabad Bank CEO Usha Ananthasubramanian to be Removed for Involvement in PNB Scam, Stock Slips
Allahabad Bank (Photo Credits: Twitter)

Mumbai, May 15: The government on Monday started the process to remove Allahabad Bank CEO Usha Ananthasubramanian and two executive directors of Punjab National Bank in connection with the Rs 12,636 crore scam perpetuated by diamond jeweller Nirav Modi in connivance with PNB officials. According to a report on Mint, the move is a part of the government's attempt to clean up the banking system.

According to a report on PTI, Allahabad Bank will hold its board meeting today on the back of the Finance Ministry's direction to take away all the powers of its MD and CEO Usha Ananthasubramanian, who has been chargesheeted by the CBI in the $2 billion Punjab National Bank scam.

Ananthasubramanian was the MD and CEO of the Punjab National Bank from 2015 to 2017 and was questioned recently by the CBI in connection with the scam, which was mainly perpetrated allegedly by diamond merchant Nirav Modi. In a stock exchange filing on Monday, Allahabad Bank said it has convened a meeting of the Board of Directors on May 15 to discuss the matter, adding that it has not received any "formal communication" from the ministry.

On Monday, Reserve Bank imposed restrictions on Allahabad Bank's lending to risky assets and raising high-cost deposits in view of deteriorating financial health. This directive came within days of RBI imposing similar restrictions on Dena Bank, which is under the Prompt Corrective Action (PCA) of the central bank.

(With inputs from PTI)