IndusInd Bank notes Rs 1,979 cr hit to net worth due to derivatives lapse, impact to reflect in FY25

Bank Indusind revealed on Tuesday that the external audit has set a negative impact of 1979 rupees on its net wealth caused by the contradictions in its derivative portfolio. The bank stated that this represents a negative impact of 2.27 % on its net wealth as of 2024.

In the organizational deposit, the lender confirmed that the financial effects of this derivative case will be reflected in its financial statements in the fiscal year 25. The development follows the decision of the previous bank to appoint an independent audit company to investigate violations related to its derivative transactions.

The contradictions related to the derivatives have pushed internal audit and raised concerns between investors and analysts. With the auditing now, Indusind Bank admitted the results and is expected to include the required amendments in the upcoming financial reports.

The lender has already signed a 2.35 % negative impact on net value through internal audit, while the external agency report now indicates a slightly less than 2.27 % lower. Last month, the bank admitted the contradictions in the account balances related to a derivative wallet. The internal audit was initially estimated at 2.35 % on the net net value of the bank as of December 2024. In addition, the bank revealed the continuous external review to verify internal results.

“On March 10, 2025, the bank revealed that it indicated some contradictions in the derivative portfolio account balances. The internal review by the bank was also estimated a negative impact on nearly 2.35 % of the net net value of the bank.”

In a previous statement, Sumant Kathpalia, Managing Director and Executive Director of Indusind, stated that any losses incurred in the derivative portfolio will be covered by the profit and loss account in the fourth quarter of the fiscal year 25. He explained that there are no plans to use general reserves for this purpose.

In early trade on Tuesday, Indusind Bank shares increased by 8 % to 741.10 rupees on the paper. The price of the lender’s share for the private sector witnessed an increase of 20 % of a decrease of 618.05 rupees last week on April 7. This follows the lowest level in 52 weeks at 605.40 rupees on March 3, 2025. On Tuesday, the stock ended at 735.85 rupees, at +6.84 %.

As of December 31, 2024, the bank’s net value of the bank reached 65,102 rupees, which exceeds the previous general number of 58,841 rupees as of December 31, 2023. Bank Indusind stressed that any impact resulting from the external agency reviews will be accurately reflected in the financial designs of al-Samafi 2024-25. In addition, the bank will enhance internal controls related to derived accounting operations.

Earlier this month, after the MPC meeting, the governor of the Indian Reserve Bank, Sanjay Malhotra, referred to the Indusind crisis as a “episode” instead of the failure of the entire banking system. Speaking to the media after the MPC announcement, Malhotra confirmed that the country’s banking system is still “safe and safe. When interrogating potential systemic concerns related to accounting phones, Malhotra rejected them as just “episodes” stating that such incidents are inevitable.