IndusInd Bank Jumps 4% After RBI Officials' Comments On Lenders Recent Crisis
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IndusInd Bank Ltd's shares rose over 4% on June 6 post-RBI officials' comments on the lender's recent troubles, including accounting lapses
IndusInd Bank Share Price: IndusInd Bank Ltd's shares jumped over 4% on June 6 after the Reserve Bank of India (RBI) officials addressed concerns about the bank's recent accounting lapses and management turmoil.
RBI Governor Sanjay Malhotra, at the post-monetary policy press conference in Mumbai, said, 'IndusInd Bank has taken enough steps to improve accounting practices. The bank is doing well overall."
He added, 'IndusInd MD and CEO have resigned, which should be good enough. Law will take its course on the IndusInd fraud. We won't fail in our duty if we have to step in."
RBI Deputy Governor J. Swaminathan also sought to calm investor nerves, stating, 'On IndusInd, the issue should settle down very soon. We will keep monitoring the banking system and see no systemic impact arising from the IndusInd Bank issue."
At 1 pm on June 6, IndusInd Bank shares were trading 4.2% higher at ₹837.2 apiece.
Governor Malhotra further noted, 'Normally, we do not comment on individual banks. Let us not be speculative on IndusInd Bank fraud."
IndusInd Bank has been navigating a troubled phase. A forensic audit is currently underway after it disclosed a Rs 2,000-crore hit to its net worth in March due to lapses in derivatives accounting. Subsequent probes have uncovered additional accounting irregularities. The bank is now in the process of appointing a new leadership team, including a new CEO.
SEBI's preliminary findings cited emails showing the senior management was aware of the accounting discrepancies as early as December 2023 and acknowledged their 'huge impact" internally.
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