Bank of Baroda (BoB) has agreed to pay $600 million, or about ₹5,700 crore, to settle a years-long legal battle with the joint administrators of collapsed UAE healthcare company NMC Health, bringing an end to the lender’s involvement in one of the largest overseas litigation cases involving an Indian state-run bank.
Mint explains why Bank of Baroda has agreed to pay, even after it said in its FY26 annual report that it had a strong chance of a favourable outcome in the case.
While the bank has asserted that the settlement was reached without any admission of liability or wrongdoing, and was aimed at avoiding prolonged litigation, uncertainty and legal costs, it has revived allegations by NMC founder B.R. Shetty, who has long accused senior Bank of Baroda officials of colluding with former NMC executives in a massive fraud that led to the healthcare group’s collapse. The bank has consistently denied any wrongdoing.
“If they have not done anything wrong, tell me why should they be even paying $1?… They’re paying $600 million, that’s a big amount,” Shetty told Mint.
“For the fraud that they made, $600 million is nothing.” He declined to elaborate, saying the matter is before the courts and has been left to his lawyers.
What is the case about?
The dispute stems from the collapse of London-listed NMC Health in 2020 after short-seller questioned the company’s financial statements. Investigations later uncovered more than $4 billion of previously undisclosed debt, forcing the healthcare giant into administration.
The joint administrators subsequently sued Shetty, former chief executive of NMC health Prasanth Manghat, and Bank of Baroda before the Abu Dhabi Global Market (ADGM) Courts, alleging they were responsible for losses suffered by the company. Parallel proceedings in England were stayed pending the outcome of the Abu Dhabi case.
According to Bank of Baroda’s exchange filing on Thursday, the ADGM trial began on 23 March 2026. Before judgment could be delivered, the bank entered into an out-of-court settlement under which it agreed to pay $600 million. The settlement resolves all claims against the bank, whose liability in the proceedings is now capped at that amount, while both the Abu Dhabi and English proceedings against the bank are being discontinued.
What are Shetty’s allegations?
Shetty has maintained that he was himself a victim of fraud. His Indian counsel, Wasim Pangarkar, senior partner at MZM Legal LLP, has alleged that Shetty’s signatures were forged on several banking documents and that senior Bank of Baroda officials worked in collusion with former NMC executives.
“It is Dr. Shetty’s case that it was ’s officials, senior officials who were working in tandem in collusion with Prashant Manghat and his brothers and this entire siphoning was going on,” Pangarkar told Mint. He further claimed that the bank may have decided to settle because it faced the risk of a much larger adverse judgment.
“It is very shocking… only during the conclusion of the trial, why all of a sudden you go ahead and settle this matter. Something has compelled the bank to sit across and settle and pay such a huge amount,” Pangarkar said.
These allegations remain contested and have not been established in court and date back to 2020.
“What is more important is that it’s a sovereign bank. It’s not a private bank. So when you’re paying $600 million, you’re not paying it from your own pocket. You’re paying the exchequer’s money,” Pangarkar said.
An email sent to Bank of Baroda on the matter did not elicit any response till press time.
In October 2020, Mint had reported that Shetty filed a police complaint alleging Bank of Baroda and Federal Bank colluded with former executives of the Shetty group to embezzle funds.
According to that complaint, Shetty alleged the Manghat brothers opened false bank accounts, transferred corporate funds, obtained fresh loans using forged documents and personal guarantees, and that Bank of Baroda permitted accounts to be opened and transactions to be carried out on the basis of forged documents. He further alleged that the bank helped evergreen loans and accepted guarantees allegedly bearing forged signatures.
What did Bank of Baroda previously say?
The settlement is notable because Bank of Baroda had expressed confidence in its legal position in its FY26 annual report.
The bank disclosed that based on legal advice, it believed it had a good chance of successfully defending the proceedings and therefore had not made any provision for the litigation, treating it as a contingent liability. That assessment now contrasts sharply with the bank’s decision to settle weeks after the ADGM trial concluded.
What do the administrators say?
The administrators’ latest progress report dated 15 May 2026 said claims against Bank of Baroda and audit firm remained among the key recovery actions being pursued to maximise recoveries for creditors.
The report further said that the ADGM trial had concluded and judgment had been reserved, making the settlement particularly significant because it came before the court could deliver its verdict.
With the bank now settling, the $600 million will go to NMC’s administration estate for distribution to creditors rather than to Shetty personally, Pangakar said, adding that proceedings involving Shetty and former NMC executives continue separately.