Investigation Announcement

IndusInd Bank has engaged an independent professional firm to investigate discrepancies identified within its derivative portfolio. The bank recently acknowledged these discrepancies, which could potentially affect approximately 2.35% of its net worth by December 2024.

Scope of the Review

The independent firm will conduct a detailed examination to determine the underlying causes of the discrepancies. This review will focus on evaluating the correctness of the accounting treatment applied to the derivative contracts, ensuring compliance with current accounting standards.

As noted in a recent stock exchange filing, “On 10th March 2025, the Bank had disclosed the ongoing review by an external agency, of certain discrepancies identified by the Bank, in its account balances relating to its derivative portfolio and that, once completed, the Bank will appropriately reflect any resultant impact in its financial statements.”

Board’s Decisions

During a recent board meeting, members decided to appoint this independent firm to conduct a thorough investigation. The objectives include identifying potential lapses, assessing the accuracy of accounting practices, and establishing accountability for the discrepancies noted in the derivative portfolio.

Regulatory Oversight

The Reserve Bank of India (RBI) has assured depositors of IndusInd Bank’s financial stability amid concerns regarding its overall health. Authorities emphasize that the bank is well-capitalized and maintains a secure position. As of December 31, 2024, IndusInd Bank reported a Capital Adequacy Ratio (CAR) of 16.46% and a Provision Coverage Ratio (PAR) of 70.20%.

Additionally, as of March 9, 2025, the bank boasted a Liquidity Coverage Ratio (LCR) of 113%, surpassing the standard regulatory requirement of 100%. The RBI has underscored its commitment to protecting depositors’ interests, especially during financial fluctuations.