IndusInd Bank shares jump over 3% as RBI Governor says stability expected soon

Business Upturn

2 days ago

By Aditya Bhagchandani Published on June 6, 2025, 12:48 IST
Shares of IndusInd Bank rose 3.05% to ₹827.70 on Friday after RBI Governor Sanjay Malhotra offered a reassuring statement regarding the bank's ongoing restructuring and succession plans. 'The matter is on track and should stabilise shortly,' Malhotra said, hinting at resolution around recent concerns that had rocked investor sentiment.
The stock moved up by ₹24.50 from its previous close of ₹803.20. It traded in the range of ₹805.00 to ₹817.50 during the session. The market cap stood at ₹629.21 billion with a trading volume of 9.88 million shares.
Governor Malhotra also acknowledged that IndusInd Bank had taken adequate steps to improve accounting standards and operational practices. This comes as a crucial vote of confidence from the central bank amid a turbulent quarter for the lender.
Background context
On May 22, the bank reported a rare quarterly net loss of ₹2,328 crore—the first in nearly two decades—due to accounting discrepancies, suspected fraud, and stress in its microfinance segment. The episode led to the exit of CEO Sumant Kathpalia and deputy CEO Arun Khurana, followed by SEBI's interim order restraining them from accessing capital markets over insider trading allegations.
The RBI had already denied Kathpalia a full-term extension earlier in March, citing ongoing scrutiny. The core issue stemmed from losses in the derivatives trading portfolio, where internal gaps were identified during compliance reviews. An external audit pegged the financial impact at ₹1,960 crore.
The Hinduja-promoted IndusInd Bank has since been coordinating closely with regulators. RBI reportedly laid out two preconditions for promoter-led capital infusion: removal of share pledges and appointment of a promoter representative on the board.
Governor Malhotra's latest remarks now suggest that with the necessary measures being implemented, a turnaround is on the horizon.
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Aditya Bhagchandani serves as the Senior Editor and Writer at Business Upturn, where he leads coverage across the Business, Finance, Corporate, and Stock Market segments. With a keen eye for detail and a commitment to journalistic integrity, he not only contributes insightful articles but also oversees editorial direction for the reporting team.