Canara Bank Flags Reliance Communications and Subsidiary Accounts as Fraud Amid Ongoing Insolvency

Reliance Communications Limited ( (IN:RCOM) ) has provided an update.

Reliance Communications Limited has disclosed that Canara Bank has classified the accounts and borrower relationships of both the company and its subsidiary Reliance Telecom Limited as fraudulent and plans to report them to the Reserve Bank of India’s Central Fraud Registry. The alleged fraud relates to periods before the onset of insolvency proceedings, and the company notes that these exposures must now be addressed within the ongoing insolvency resolution framework.

Both Reliance Communications and Reliance Telecom emphasize that resolution plans approved by their respective committees of creditors are pending approval before the National Company Law Tribunal. They add that the resolution professionals have already initiated avoidance applications on certain past transactions, and any final treatment of these matters will depend on NCLT decisions and the terms of the approved resolution plans, potentially affecting recoveries and creditor outcomes.

More about Reliance Communications Limited

Reliance Communications Limited is an Indian telecommunications company that has historically provided mobile and telecom services in India and related markets. The company, along with its subsidiary Reliance Telecom Limited, is currently undergoing corporate insolvency resolution under the Insolvency and Bankruptcy Code, with resolution plans approved by creditors and awaiting final clearance from the National Company Law Tribunal in Mumbai.

Average Trading Volume: 626,068

Technical Sentiment Signal: Sell

Current Market Cap: 2.21B INR

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