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DHFL to face transaction audit on Yes Bank links

“Grant Thornton has already started scrutinising documents related to transactions,” said one of the persons in the know. “The existing administrators want to make things transparent so that the matter does not impact the valuation of DHFL assets.”

, ET Bureau|
Last Updated: Mar 13, 2020, 08.40 AM IST
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Agencies
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A number of loans granted to stressed non-banking financial companies by Yes Bank have come under the scanner of investigative agencies
MUMBAI: The central bank appointed administrator at Dewan Housing Finance (DHFL) has ordered a transaction audit at the non-bank lender after allegations of money laundering surfaced in the aftermath of the regulatory action on Yes Bank.

Grant Thornton has been asked to submit a report within a month, sources aware of the development told ET. The bank subscribed to bonds sold by the home financier, which in turn allegedly lent to companies owned by former Yes Bank promoter Rana Kapoor or his family members. DHFL did not respond to ET’s email. Grant Thornton could not be contacted immediately for comments.

“Grant Thornton has already started scrutinising documents related to transactions,” said one of the persons cited above. “The existing administrators want to make things transparent so that the matter does not impact the valuation of DHFL assets.”

Earlier, the home financier appointed Grant Thornton India LLP as the transaction auditor for the whole corporate insolvency resolution process (CIRP).

A number of loans granted to stressed non-banking financial companies by Yes Bank have come under the scanner of investigative agencies, ET reported on March 11.
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Cofounder Rana Kapoor was arrested by the Enforcement Directorate earlier this month after he was booked by the Central Bureau of Investigation (CBI). Investigators are examining whether kickbacks were paid through shell companies. The embattled home financier received about 23 bids across four categories including whole company, retail, slum rehabilitations and project loans.

DHFL was the first financial services company to be admitted to the bankruptcy courts after the central bank superseded its board and appointed former Indian Overseas Bank chief, R Subramaniakumar, to resolve the outstanding ₹85,000-crore debt at the NBFC.

The administrator and DHFL’s advisor EY are in the process of assessing bids based on the eligibility criteria, after which they would be given access to the balance sheet and books of the company for due diligence.

State Bank of India (SBI) has an exposure of about Rs 10,000 crore to DHFL. Other state-owned lenders to DHFL include Bank of India, Canara Bank and Punjab National Bank. Union Bank of India leads the consortium of lenders, while the steering committee includes nominees from the SBI, Syndicate Bank and Canara Bank.

(Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

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