Bank of Baroda has said it will defend its interests after NMC Health founder B.R. Shetty filed a $15 billion(₹ 1.4 Lakh Crore) lawsuit in Mumbai.
What Has B.R. Shetty Alleged?
UAE-based businessman B.R. Shetty has filed a case in the Bombay High Court against Bank of Baroda and 25 other defendants, alleging their involvement in financial irregularities linked to the collapse of NMC Health.
Shetty has alleged that the bank and several current and former employees helped facilitate a fraud that contributed to the healthcare group’s financial collapse. NMC Health, once the Gulf’s largest private healthcare provider, was placed under administration in 2020 following months of financial mismanagement. The company subsequently disclosed debts of $6.6 billion, substantially exceeding earlier estimates of $2.1 billion.
How Has Bank of Baroda Responded?
In a stock exchange notification on October 14, Bank of Baroda said it had not yet been formally served with the lawsuit. The public sector lender maintained that the allegations had not been tested in court and that it could not comment on the contents of the pleadings.
The bank said it would firmly defend the proceedings once formally served and take necessary measures to protect its interests. The allegations against the bank and its employees remain unproven.
Why Is the Bank Pursuing Shetty?
Bank of Baroda disclosed that it was pursuing recovery and enforcement proceedings against Shetty in India and the United Arab Emirates. According to the lender, the proceedings concern outstanding dues of ₹2,800 crore, equivalent to approximately $294.57 million. The bank also stated that it had obtained several decrees against the businessman.
It clarified that the new lawsuit would not create an immediate financial liability unless a court passed an order or the bank was required to make provisions for potential damages.
How Have Bank of Baroda Shares Reacted?
Bank of Baroda shares declined 2.6% on Tuesday after the lawsuit became public. The stock was also down 2.6% at ₹231.40 on Wednesday, reflecting market attention to the legal proceedings.
The dispute centres on the bank’s lending relationship with NMC Health and associated entities in the UAE.
The $15 billion lawsuit brings renewed attention to the financial collapse of NMC Health and the competing claims between its founder and Bank of Baroda. While Shetty alleges fraudulent conduct, the bank is pursuing recovery of outstanding dues and has promised a firm legal defence. The allegations and the bank’s potential liability remain subject to judicial examination.
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