IndusInd Bank reports decline in deposit growth amid accounting discrepancies

Synopsis

IndusInd Bank faced a 2% diminution successful word and low-cost deposits owed to discrepancies successful forex derivatives accounting. Retail deposits fell by Rs 3,550 crore, and full deposits grew marginally. Loan advances dropped 5.2%, with firm loans starring the decline. The RBI approved a CEO extension, and an autarkic audit was initiated for the derivatives portfolio.

Private lender IndusInd Bank, reported a 2 percent constituent diminution successful the maturation of its word deposits and low-cost deposits successful the March 4th compared to the December 2024 quarter, according to provisional figures. This driblet is apt owed to deposit outflows pursuing the bank's disclosure of accounting discrepancies related to forex derivatives.

In an speech filing, the slope stated that deposits successful its existent and savings accounts grew by 32.8% arsenic of the extremity of the March 2025 quarter, compared to 34.9% maturation successful the December 2024 quarter.

Analysts estimation that astir Rs 3,550 crore whitethorn person been withdrawn by retail and tiny concern depositors during the March quarter. Provisional information showed that retail deposits and deposits from tiny concern customers declined to Rs 1,85,180 crore arsenic of March 31, 2025, from Rs 1,88,730 crore arsenic of December 31, 2024.

The bank’s full deposits grew modestly by 0.4% sequentially, reaching Rs 4.11 lakh crore arsenic of March 31, 2025. On a year-on-year basis, full deposits accrued by 6.8%, compared to an 11% maturation successful the December quarter.

To antagonistic the deposit outflows, IndusInd Bank raised implicit six times its accustomed magnitude from certificates of deposit, securing Rs 16,550 crore successful March 2025, compared to Rs 2,500 crore successful the aforesaid period the erstwhile year.

On March 7, the Reserve Bank of India (RBI) approved a one-year hold for Sumant Kathpalia’s reappointment arsenic CEO. Kathpalia’s term, initially acceptable to extremity connected March 24, 2025, volition present reason connected March 23, 2026.

On March 10, the slope disclosed the initiation of an interior reappraisal of a information of its derivative portfolio aft identifying discrepancies successful relationship balances. The slope estimates these discrepancies could interaction its nett worthy by astir 2.35%, with analysts projecting a imaginable nonaccomplishment of astir Rs 1,600 crore.

After this announcement the precise adjacent time the lender’s banal fell much than 27% and has truthful acold has fallen much than 50% connected year. IndusInd Bank’s stock terms is presently trading astatine Rs 682 a piece.

Subsequently, connected March 21, IndusInd Bank announced the assignment of an autarkic steadfast to behaviour a broad audit of its derivatives portfolio and to find absorption accountability for the issue.

Meanwhile its advances maturation fell 5.2% sequentially taking the full indebtedness publication to Rs 3.48 lakh crore astatine the extremity of the March quarter. Corporate publication led the diminution with a contraction of much than 15% successful the publication sequentially. On twelvemonth ground the firm publication contracted astir 5%. The user loans grew by 6.3% connected twelvemonth and 3.4% 4th connected quarter, provisional numbers showed.

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