India’s state-owned lender IDBI Bank has disclosed that its five branches in the southern states of Andhra Pradesh and Telangana have disbursed fraudulent loans of nearly INR7.72bn ($118.8m).

The bank found two of its employees guilty in processing and disbursing the loans, some of which were issued for fish farming businesses between the fiscal years 2009 and 2013.

These loans for fishing business were stated to have been obtained by providing counterfeit lease documents of non-existent fish ponds and by increasing the value of collateral.

The bank has already dismissed one employee while the other had retired.

Following the disclosure, the shares of IDBI Bank fell by nearly 3.5%, Reuters reported.

The Nifty PSU Bank index, the index for public sector lenders, also fell by 1.8%.

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The country’s premier investigative agency Central Bureau of Investigation (CBI) has started investigations into the scandal and has registered two cases related to the branches at Basheerbagh and Guntur.

Recently, the bank started a quality assurance audit which is expected to be completed by the next month. The scope of this audit includes review of the internal audit framework concerning to policies, procedures, reporting structures, formats of the bank and integration thereof with risk based supervision, reported PTI.