Investing.com-- Shares of IndusInd Bank Ltd (NSE:INBK) plummeted more than 20% on Tuesday following the disclosure of accounting discrepancies in its derivatives portfolio, raising concerns about the bank’s financial health and internal controls.
India’s fifth-largest private sector lender on Monday reported a 2.35% reduction in its net worth as of December 2024, attributed to underestimated hedging costs from past foreign exchange transactions.
This reduction could potentially impact the company’s profit by around 1,500 crore rupees, MoneyControl News reported citing a person familiar with the matter.
Shares of the company fell as much as 22.6% to 696.65 rupees, their lowest level since November 2020. They were trading 21.3% lower at 708.50 rupees as of 10:42 IST.
IndusInd Bank has initiated an independent review by an external agency to validate its internal findings. Despite the setback, the bank maintains that its profitability and capital adequacy are robust enough to absorb this one-time impact.
The revelation has sparked concerns over the effectiveness of the bank’s internal processes and compliance mechanisms.
The Nifty 50 index and the BSE Sensex 30, both were trading down 0.2% amid a broader global downturn due to recession fears stemming from U.S. President Donald Trump’s trade policies.