Bank of Baroda Clarifies MP Government Transaction Issue, Says No Material Impact

Bank of Baroda has issued a clarification via a press release on a media report regarding a temporary restriction on handling government business in Madhya Pradesh, stating that the issue was resolved within 24 hours and has no material impact.

The bank said one of its branches received an email on March 26 requesting a fund transfer from a Madhya Pradesh government account, but the amount did not match the available balance. A revised request was received later the same day without an official letter.

On March 27,the branch received a formal communication from a state government department for fund transfer. Although the branch was closed due to Ram Navami, the bank completed the transaction the same day after necessary approvals, executing the transfer in four tranches.

Later that day, the Commissioner of the Directorate of Institutional Finance (DIF), Bhopal, issued an order debarring the bank from conducting government business. The bank said its zonal office immediately submitted a representation explaining the situation.

The restriction was withdrawn on March 28 with the authorities cancelling the earlier order with immediate effect.

Bank of Baroda said the brief nature of the restriction meant it did not disclose the development to stock exchanges. It added that the episode has no material impact on its operations.