Latest news with #IndusInd
Mint
2 days ago
- Business
- Mint
IndusInd Bank returns to profit post FX derivatives hit, says on track to pick CEO
Mumbai: IndusInd Bank, still reeling from its ₹ 2,000-crore derivatives hit and a string of top-level exits, is making headway in appointing a new chief executive officer (CEO), even as it returns to profit and sharpens focus on its key agenda that includes cost control, chairman Sunil Mehta said in an analysts' call on Monday. Mehta said the bank has not revised its CEO recommendations submitted to regulators and is actively scouting top-tier talent, both internally and externally, for senior management roles. The bank had earlier shortlisted three candidates for the top position, including Rajeev Anand from Axis Bank. This comes amid recent senior-level exits, including the resignation of chief human resources officer Zubin Mody last Friday, following the departure of CEO Sumant Kathpalia and Deputy CEO Arun Khurana in the wake of the bank reporting its ₹ 2,000 crore derivative losses. In March this year, IndusInd Bank disclosed a ₹ 2,000-crore hit due to mis-accounting in foreign exchange derivatives that amounted to about 2.35% of its net worth. The shocking disclosure exposed risk control lapses and triggered regulatory action and senior management exits. Referring to the private sector bank's June quarter results, Mehta said IndusInd will follow a profitability-first approach and will look at containing the year-on-year (y-o-y) operational expense growth to a single digit that helped the private lender return to profitability, albeit 72% lower y-o-y. The private sector lender has reported net profit of ₹ 604.07 crore for April-June, as against a loss of ₹ 2,328.9 crore in the previous quarter. 'We have taken measures such as reduction in savings account rate, de-emphasizing growth in lower return businesses through effective transfer pricing to restore the profitability of the organization towards its underlying potential,' said Mehta. 'The bank had over 20% OPEX CAGR in the last three years and we are now working towards containing OPEX to a single digit year-on-year growth in the foreseeable future.' Mehta also said the bank will be cautious in growing its microfinance book, as it reported slippages worth ₹ 880 crore during the quarter. The overall bad loan slippages were at ₹ 2,567 crore in Q1, half the quarter-ago number of ₹ 5,104 crore. IndusInd Bank said it is looking to moderate its corporate loan book growth, as it will focus on scaling up the granular mid- and small-corporate portfolio. The bank's loan book saw a 4% degrowth y-o-y to ₹ 3.33 lakh crore, while the deposit growth was flat. The core income or net interest income fell by 14% from a year ago to ₹ 4,640 crore in the June quarter as against ₹ 5,408 crore in the corresponding quarter last year. The net interest margin improved to 3.64% from 2.25% in the previous quarter, owing to lower cost of deposits on the back of cut in rates, particularly for savings accounts, and the higher overall retail loan mix. The bank's fee income fell 35% to ₹ 1,532 crore during the reporting quarter as against ₹ 2,348 crore a year ago. Fee income was hit by subdued corporate activity and lower disbursements by microfinance institutions.
Business Recorder
2 days ago
- Business
- Business Recorder
India's IndusInd Bank posts quarterly profit drop as loans decline
BENGALURU: India's IndusInd Bank reported a quarterly profit drop on Monday, as its loans declined and funds kept aside for potential bad loans rose. The country's fifth largest private lender by assets said its profit fell 68% to 6.84 billion rupees ($78.93 million) for the quarter ended June 30. IndusInd reported its biggest-ever quarterly loss in the previous quarter, as it took a $230 million hit in the year ended March 31 due to years of misaccounting internal derivative trades, prompting the resignations of CEO Sumant Kathpalia and deputy Arun Khurana in April. Since then, the lender has reported a decline in loans. Loans fell 3.1% from a quarter earlier, while deposits fell 3.3%. Net interest income, the difference between interest earned and paid, fell to 46.40 billion rupees from 54.08 billion rupees a year earlier. The private lender has been grappling with elevated bad loans in its microfinance book, forcing it to set aside more funds to meet potential losses. IndusInd Bank to raise up to $3.5 billion, allow Hindujas to nominate two board seats Its provisions and contingencies rose 65.5% year-on-year to 17.38 billion rupees. Gross non-performing assets rose to 3.64% at June-end from 3.13% at March-end. IndusInd Bank approved raising up to $3.47 billion and allowing promoters to nominate two board directors, it said last week, as it seeks to restore investor confidence.
India.com
6 days ago
- Business
- India.com
IndusInd Bank To Raise Rs 30,000 Crore Via Debt, Equity Mix
Mumbai: The Hinduja family-promoted IndusInd Bank's Board of Directors on Wednesday approved raising up to Rs 30,000 crore through a combination of debt and equity and allowed the promoters to nominate two board directors, as it seeks to restore confidence in its operations after the recent Rs 2,000 crore accounting lapse. The lender will raise Rs 20,000 crore through debt securities in any permitted mode on a private placement basis, or its equivalent amount in permitted foreign currencies. It will also augment the capital base via the issue of securities, including American Depository Receipts, Global Depository Receipts, and Qualified Institutional Placement, amounting to Rs 10,000 crore. The bank said after the approval of the RBI, it will make amendments in its Articles of Association to give its promoters, the Hinduja family, the right to appoint two non-executive, non-independent Directors on the bank's board. The UK-based Hinduja family, which can now nominate up to two directors on IndusInd's board, did not previously have any representation on the board. Earlier this year, IndusInd Bank made a disclosure of accounting lapses in its derivatives portfolio. The bank appointed external agencies to assess the financial impact, which was later revealed to be around Rs 2,000 crore, and to find the root cause of the accounting errors. The bank's net worth took a big hit as the misaccounting of internal derivative trades was exposed. Taking moral responsibility for the lapses, the bank's CEO, Sumath Kathpalia, resigned in April, just a day after its former deputy CEO, Arun Khurana, left the bank. The Mumbai-based private lender reported a net loss of Rs 2,328 crore for the January-March period as accounting issues and stress in the microfinance portfolio led to the balance sheet taking a hit. IndusInd's Net Interest Income (NII) or core income declined by 43.4 per cent from the same quarter last year to Rs 3,048 crore. The asset quality of the bank deteriorated on a sequential basis, with Gross NPAs rising to 3.13 per cent of total loans from 2.25 per cent in the preceding October-December quarter, while net NPAs for the quarter stood at 0.95 per cent, up from 0.68 per cent in the previous quarter.
Business Recorder
7 days ago
- Business
- Business Recorder
IndusInd Bank to raise up to $3.5 billion, allow Hindujas to nominate two board seats
India's IndusInd Bank will raise up to $3.47 billion and allow promoters to nominate two board directors, the private sector lender said on Wednesday, as it seeks to restore confidence after a $230 million accounting lapse. IndusInd is looking to secure 300 billion rupees in funding, comprising a 200 billion rupees debt issue on a private placement basis and a 100 billion rupees capital increase through issue or placement of securities. The bank's net worth took a $230 million hit in the fiscal year ended March 31 due to years of misaccounting of internal derivative trades, prompting the resignations of CEO Sumant Kathpalia and deputy Arun Khurana in April. The UK-based Hinduja family own a 15.82% stake in the bank and are listed as its promoters, a regulatory classification in India for large shareholders who control key decision-making. India's IndusInd Bank to consider raising funds The Hindujas can now nominate up to two directors on IndusInd's board, the bank said, adding that the move was approved by India's central bank. Promoters previously did not have representation on the board. IndusInd, currently run by an executive committee, has shortlisted three senior bankers - Rajiv Anand, Rahul Shukla, and Anup Saha - for the position of CEO, Reuters reported last month. Saha resigned as non-bank lender Bajaj Finance's managing director on Monday. IndusInd will report its first-quarter results on July 28.
Time of India
7 days ago
- Business
- Time of India
IndusInd Bank to raise up to $3.5 billion, allow Hindujas to nominate two board seats
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel India's IndusInd Bank will raise up to $3.47 billion and allow promoters to nominate two board directors, the private sector lender said on Wednesday, as it seeks to restore confidence after a $230 million accounting is looking to secure 300 billion rupees in funding, comprising a 200 billion rupees debt issue on a private placement basis and a 100 billion rupees capital increase through issue or placement of bank's net worth took a $230 million hit in the fiscal year ended March 31 due to years of misaccounting of internal derivative trades, prompting the resignations of CEO Sumant Kathpalia and deputy Arun Khurana in UK-based Hinduja family own a 15.82% stake in the bank and are listed as its promoters, a regulatory classification in India for large shareholders who control key Hindujas can now nominate up to two directors on IndusInd's board, the bank said, adding that the move was approved by India's central previously did not have representation on the currently run by an executive committee, has shortlisted three senior bankers - Rajiv Anand, Rahul Shukla, and Anup Saha - for the position of CEO, Reuters reported last resigned as non-bank lender Bajaj Finance's managing director on will report its first-quarter results on July 28.
