Mumbai: IndusInd Bank said on Sunday it would absorb ₹1,959.98 crore-or the full impact-of losses from incorrect accounting practices in its March earnings. It also promised action against errant employees and sought to strengthen accountability through a realignment of roles.
"The board is taking necessary steps to fix accountability of the persons responsible for these lapses and re-align roles and responsibilities of senior management," IndusInd Bank said in a filing to the stock exchanges. The bank is yet to tell the exchanges the date on which the board will meet to review the fourth quarter earnings. In the year-ago quarter, the bank had a net profit of ₹2,346.84 crore.
The move follows the completion of a detailed investigation into the relevant derivatives accounting by an independent professional firm appointed by the bank's board on March 20. The probe was aimed at identifying the root cause of accounting discrepancies in the bank's derivatives portfolio disclosed earlier on March 10. Although the bank has not named the 'professional firm' that conducted the investigation in its disclosures to the exchanges, sources said it was an investigation undertaken by Grant Thornton Bharat.
Appointed firm submitted its report on April 26, determining that the cumulative adverse impact on the bank's profit and loss account stood at ₹1,959.98 crore as of March 31, 2025, in line with earlier estimates disclosed on April 15.
According to bank, the losses stemmed from incorrect accounting of internal derivative trades, particularly in cases of early termination. Errors led to the recording of notional profits, distorting the bank's financials.
"The bank will appropriately reflect the resultant impact of the accounting discrepancies in the financial statements for FY25 and take measures to strengthen internal controls accordingly," the statement added.
"The board is taking necessary steps to fix accountability of the persons responsible for these lapses and re-align roles and responsibilities of senior management," IndusInd Bank said in a filing to the stock exchanges. The bank is yet to tell the exchanges the date on which the board will meet to review the fourth quarter earnings. In the year-ago quarter, the bank had a net profit of ₹2,346.84 crore.
The move follows the completion of a detailed investigation into the relevant derivatives accounting by an independent professional firm appointed by the bank's board on March 20. The probe was aimed at identifying the root cause of accounting discrepancies in the bank's derivatives portfolio disclosed earlier on March 10. Although the bank has not named the 'professional firm' that conducted the investigation in its disclosures to the exchanges, sources said it was an investigation undertaken by Grant Thornton Bharat.
Appointed firm submitted its report on April 26, determining that the cumulative adverse impact on the bank's profit and loss account stood at ₹1,959.98 crore as of March 31, 2025, in line with earlier estimates disclosed on April 15.
According to bank, the losses stemmed from incorrect accounting of internal derivative trades, particularly in cases of early termination. Errors led to the recording of notional profits, distorting the bank's financials.
"The bank will appropriately reflect the resultant impact of the accounting discrepancies in the financial statements for FY25 and take measures to strengthen internal controls accordingly," the statement added.
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