Mumbai : Axis Bank’s foreign exchange transactions with the Punjab National Bank (PNB) were carried out after due authentication of SWIFT codes by the latter, the private sector bank said in a clarification to the exchanges, regarding its exposure to the $1.77 billion fraud in PNB.
The Society for Worldwide Interbank Financial Telecommunication network has identified financial institutions worldwide with codes which enable them to send and receive information about transactions safely. “…the bank (Axis Bank), through its overseas branches, undertakes transactions against LoU issued by other banks.
These amounts are then credited to the LOU issuing bank’s Nostro accounts. Axis Bank has in the past undertaken such transactions with PNB against their authenticated SWIFT LOUs,” it said. Banking sources said that although the letter was addressed to 30 banks, the key banks that are likely to have been counterparties in Nirav Modi cases are Axis Bank, Allahabad Bank, BoI, Union Bank of India and UCO Bank.