Real-Time EquityWire is available only to registered users. This is best for professional traders and people who track markets actively.Real-Time EquityWire is available only to registered users. This is best for professional traders and people who track markets actively.
Informist, Monday, Mar. 10, 2025
--IndusInd Bank: Profitability, capital of bank healthy to absorb one-time hit
--IndusInd Bank: To mull discrepancies' impact on financials post agency report
--IndusInd Bank: External agency to validate findings of internal review
--IndusInd Bank: Hit from discrepancies 2.35% of bank's net worth as on Dec 31
--IndusInd Bank: Review of derivative portfolio accounts found discrepancies
MUMBAI – IndusInd Bank Monday said an internal review has noticed discrepancies in the accounts of its derivative portfolio. The review has estimated an adverse impact of about 2.35% of the bank's net worth as on Dec. 31, the bank informed the exchanges.
As on Dec. 31, IndusInd Bank's net worth was INR 651.02 billion. As such, an adverse impact of 2.35% amounts to about INR 15.30 billion.
The bank has appointed an external agency to independently review and validate the internal findings. "A final report of the external agency is awaited and basis which the bank will appropriately consider any resultant impact in its financial statements," the filing said.
The bank's profitability and capital adequacy remain healthy to absorb this one-time impact, the bank said in its filing.
IndusInd did not disclose the exact nature of the discrepancies its internal review found. According to the guidelines issued by RBI on the Classification, Valuation and Operation of Investment Portfolio of Commercial Banks (Directions), banks should categorise their derivatives portfolio into three fair value hierarchies – Level 1, Level 2, and Level 3 – and disclose them in the notes to accounts of their financial statements.
According to the guidelines, banks should also not pay dividends out of net unrealised gains recognised in the profit and loss account arising on fair valuation of Level 3 derivatives assets and liabilities on their balance sheet. Further, such net unrealised gains on Level 3 derivatives recognised in the profit and loss account should be deducted from common-equity tier-1 capital.
IndusInd Bank's net profit in Oct-Dec declined 39% on year to INR 14.01 billion. For the nine months ended December, the net profit fell 26% on year to INR 49.04 billion. The Basel-III capital adequacy ratio of the bank was at 16.46% as on Dec. 31. The tier-1 capital adequecy ratio of the bank was at 15.18% and the tier-2 capital adequacy ratio was at 1.28% as on Dec. 31.
On Monday, shares of IndusInd Bank closed 3.9% lower at INR 900.50 On the National Stock Exchange. The bank made the announcement post-market hours.
End
Reported by Kshipra Petkar
Edited by Saji George Titus
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
Share this Story:
