IndusInd Bank share price jumps over 5% after RBI Governor says lender’s issue should ‘settle down soon’
IndusInd Bank share price jumped over 5% after the Reserve Bank of India’s (RBI) officials, including Governor Sanjay Malhotra, commented on the private lender’s recent crisis. IndusInd Bank shares rallied as much as 5.32% to ₹845.85 apiece on the BSE.
In its post-monetary policy press conference, RBI Governor Sanjay Malhotra said that the issue at the IndusInd Bank should settle down very soon.
“IndusInd Bank has taken enough steps to improve accounting practices. The issue in the bank should settle down very soon. The bank is doing well on the whole,” Malhotra said.
IndusInd Bank MD & CEO has resigned, which was good enough, according to Malhotra.
“Law will take its course on IndusInd fraud. RBI will not be failing in its duty if any step has to be taken,” added Malhotra.
RBI Deputy Governor J Swaminathan assured that there seems to be no systemic impact arising from the IndusInd Bank issue, while the central bank will keep monitoring the banking system.
IndusInd Bank Crisis
IndusInd Bank is currently undergoing challenges, with a forensic audit underway following the discovery of significant accounting irregularities. In March this year, the bank disclosed a ₹2,000 crore impact to its net worth due to lapses in the accounting of derivatives. Subsequent investigations have revealed additional discrepancies, prompting the bank to initiate a leadership overhaul, including the appointment of a new Chief Executive Officer.
Recently, the Securities and Exchange Board of India (SEBI) barred the bank’s former CEO Sumant Kathpalia, deputy CEO Arun Khurana, and three other individuals from trading in securities, citing alleged insider trading violations.
Sebi found that these senior executives allegedly traded in IndusInd Bank shares while in possession of unpublished price-sensitive information (UPSI) related to discrepancies in account balances of the bank’s derivative portfolio. By doing so, they were able to avoid losses totaling ₹19.78 crore, with the bulk of the benefit attributed to then CEO Kathpalia and deputy CEO Khurana.
Sebi noted that the internal team of the bank was aware of the financial implications due to discrepancies in the derivative portfolio and had already begun calculating the impact internally.
The fraud-hit private sector lender reported a loss of ₹2,329 crore in the fourth quarter of FY25, its worst performance ever.
At 2:30 PM, IndusInd Bank share price was trading 2.65% higher at ₹824.40 apiece on the BSE.
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