Reserve Bank of India (RBI) Governor Sanjay Malhotra, commenting on the IndusInd Bank case, said the central bank would not shy away from its responsibility if further action is required. He emphasised that the accounting irregularities at IndusInd Bank are under close watch and are expected to be addressed soon.
“The IndusInd Bank issue should settle very soon. We will keep monitoring it. The bank has taken enough steps to improve the accounting issues and, on the whole, it is doing well,” Malhotra said while briefing the post-monetary policy press conference.
Further referring to recent developments at the private lender, he said, "Such episodes will occur, but they should not concern us excessively as long as they remain isolated." He asserted that the overall banking system remains robust.
Malhotra said that IndusInd Bank has taken adequate measures to improve its accounting and other internal practices. "On the whole, IndusInd Bank is doing well," he said.
"The MD and CEO has resigned. I thought that should be good enough. What more are you hinting at? Do you expect the board to resign too?" RBI Governor Sanjay Malhotra remarked, addressing questions on the fallout from the recent governance issues at the bank.
RBI Deputy Governor Swaminathan J stated that the discrepancies flagged by the central bank have already been addressed in the fourth-quarter (Q4) results, in line with regulatory directions. He added that a forensic audit has also been completed to establish accountability. “Each such crisis gives us valuable lessons and helps us sharpen our supervisory framework,” he said.
Following the comments, IndusInd Bank saw its shares rise by 5% on Friday, June 6. At 2 PM, the shares were trading at ₹824.25, up by 2.63%.
The private lender has been under pressure following a series of troubling developments, including alleged misreporting of derivatives, accounting irregularities, and the recent exit of two senior executives. IndusInd Bank's mis-accounting saga, which started with "discrepancies" in its derivative portfolio, has now turned into a suspected "fraud" in which the private lender said there might be involvement of some key senior officials.
As a result of this prolonged series of lapses—some of which trace back to FY16 — the company has reported a staggering net loss of ₹2,328.92 crore for the fourth quarter of FY25.
