Bank of Baroda Settles NMC Health Dispute
India's second-largest public sector bank, Bank of Baroda (BoB), has reached an out-of-court settlement in a multi-year legal dispute related to the collapse of UAE-based healthcare provider NMC Health. The bank announced on July 2, 2026, its agreement to pay $600 million (around Rs 5,700 crore) to the joint administrators of NMC Health PLC, NMC Healthcare Ltd, and NMC Holding.
The settlement concludes extensive legal proceedings that arose from the cross-border insolvency and fraud uncovered at the NMC Group. While the bank denies all allegations, it opted for the settlement to avoid prolonged litigation, associated costs, and the uncertainty of a court outcome.
The Collapse of NMC Health
NMC Health, once a major private healthcare provider in the UAE and founded by NRI businessman B.R. Shetty, entered insolvency after a forensic audit in 2020 revealed billions of dollars in previously undisclosed debt. This discovery triggered a cascade of legal actions across multiple jurisdictions, including the Abu Dhabi Global Market Court and the High Court of Justice of England and Wales.
The insolvency was attributed to a massive fraud allegedly perpetrated by shareholders, senior management, and employees of the NMC Group between 2012 and 2020. Bank of Baroda was a significant lender to NMC Health and became embroiled in the subsequent recovery efforts by administrators.
Allegations Against Bank of Baroda
Administrators of entities within the NMC Group had filed legal proceedings against B.R. Shetty, former NMC Health CEO Prashant Manghat, and Bank of Baroda. It was alleged in court that Bank of Baroda facilitated fictitious financing arrangements, which helped conceal NMC’s true debt position. The bank, however, consistently denied these allegations, stating in its May 2026 annual report that it had filed a robust defense on both facts and law in the ongoing proceedings.
The trial before the Abu Dhabi Global Market (ADGM) court commenced on March 23, 2026, with parallel proceedings in England and Wales stayed pending the ADGM outcome. The ADGM claims included insolvency and civil claims under ADGM and UAE law related to the fraud and resulting losses.
Terms of the $600 Million Settlement
Under the settlement agreement, Bank of Baroda will pay $600 million to fully resolve all claims brought against it by the NMC Health entities and their joint administrators. Crucially, the agreement states that all claims and causes of action between the parties have been resolved without any admission of liability or wrongdoing by Bank of Baroda. The specific terms of the settlement, beyond the payment amount, remain confidential.
Following the agreement, proceedings before the ADGM have been discontinued, and steps are underway to discontinue the English proceedings. The settlement amount was paid through Bank of Baroda's Abu Dhabi branch. News of the settlement led to Bank of Baroda shares falling over 7% across two trading sessions immediately following the disclosure.