IndusInd Bank Faces Derivative Portfolio Accounting Woes

IndusInd Bank is facing accounting discrepancies in its derivative portfolio that will adversely affect its finances by Rs 1,960 crore in FY25. Internal trades have ceased, and accountability measures are underway to address errors and improve internal controls.

IndusInd Bank has announced significant accounting discrepancies in its derivative portfolio, estimating a substantial financial impact of Rs 1,960 crore for the fiscal year 2025.

This revelation follows an external auditor's report, which identified incorrect accounting practices, leading to notional profits and discrepancies in financial statements. The bank has since halted internal derivative trading effective April 2024.

In response, IndusInd Bank's board is actively working to enhance internal controls, hold responsible parties accountable, and realign senior management roles to prevent future lapses.

(With inputs from agencies.)