The Indian lender confronts a major legal battle initiated by B.R. Shetty following allegations of banking fraud.
Bank of Baroda plans to firmly contest a $15 billion lawsuit filed by NMC Health founder B.R. Shetty regarding alleged financial misconduct.
The collapse of NMC Health continues to generate massive legal disputes across international borders. UAE-based businessman B.R. Shetty recently filed a $15 billion lawsuit against Bank of Baroda. He submitted this substantial claim to the Bombay High Court earlier this week. Shetty named the prominent Indian lender, along with 25 other defendants, in his legal filing.
Furthermore, the lawsuit claims that bank employees actively facilitated major financial misconduct. Shetty accuses them of ignoring repeated anti-money laundering warnings over several years. He alleges that staff members accepted documents containing distinctly forged signatures. These actions reportedly contributed directly to the downfall of the Middle East healthcare group.
However, the second-largest state lender firmly denied receiving any formal legal notices regarding this matter. Representatives clarified that the bank cannot assess untested court pleadings without proper documentation. Therefore, officials promised to vigorously defend their institutional interests if served with the lawsuit. They plan to take all necessary steps to block these extensive financial claims.
Meanwhile, Bank of Baroda actively pursues its own recovery proceedings against the healthcare founder. The institution seeks to reclaim outstanding dues totalling 28 billion rupees ($294.57 million). Officials have already secured several enforcement decrees against Shetty in India and the UAE. Consequently, the bank faces no immediate liability unless a court mandates provision for damages.
NMC Health was previously the largest private healthcare provider in the Gulf region. Administrators took control of the firm in 2020 following severe financial mismanagement. The company disclosed hidden debts reaching $6.6 billion, far exceeding initial estimates. This revelation triggered widespread panic among regional investors and international financial institutions.
Bank of Baroda recently agreed to pay $600 million to settle separate claims from NMC administrators. Nevertheless, this new legal challenge demands $5 billion in direct damages alone. Shetty also seeks an additional $5 billion for consequential losses and $5 billion for reputational harm. Unsurprisingly, the bank’s share price dropped by 2.6% to 231.4 rupees following these alarming reports.
(Source: BFSI)
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