IndusInd Bank Board To Submit Top CEO Candidate Names To RBI—A Timeline Of Crisis

IndusInd Bank’s board is set to announce its shortlist for the new chief executive officer on Monday, marking a pivotal moment after the crisis led by a derivatives trading fiasco and subsequent leadership turmoil.

The Reserve Bank of India had directed the bank to submit its CEO recommendations by June 30, a deadline that has now arrived.

According to news reports, the top three CEO contenders include Rajiv Anand, Deputy Managing Director of Axis Bank, who is set to retire from the private sector bank in August, Anup Saha, Managing Director at Bajaj Finance, who brings strong retail and digital banking credentials, and former Group Head HDFC Bank Rahul Shukla, who is currently on sabbatical and is known for his experience in commercial and rural banking.

The announcement of a new CEO is crucial for IndusInd Bank as the leader will be tasked with restoring trust, tightening governance, and stabilising the bank after months of financial misreporting and management turmoil.

The new CEO’s credibility and strategy will be seen as essential to reassure investors, regulators, and customers, and to guide the bank through its recovery and future growth.

Here's a chronological breakdown of key events as detailed in the SEBI order till February 2024, followed by public announcements from the bank itself:

Sept. 26, 2023 – IndusInd Bank creates an inter-department team to implement RBI's directions on derivative accounting.

Nov. 20 – CFO writes to Deputy CEO Arun Khurana and two others, highlighting that he had not received an impact analysis of derivative accounting.

Nov. 21 – CFO sends another email. “We already have done exercise in the past with KPMG while preparing for submission of the proforma IndAS financial statement to Bank. There is already an information being prepared on a six monthly basis for impact of IndAS on derivative accounting."

Nov. 29 – IndusInd Bank Head of Balance Sheet Liquidity Management sends email to Khurana, others. “We need the numbers urgently. Please assist as my team is struggling to find answers here. As mentioned, this needs to be discussed with MD this evening.”

Nov. 30 – IndusInd Bank's head of accounts writes an email detailing that the probable impact of derivatives accounting gap was Rs 1,750 crore.

Dec. 4 – CEO Sumant Kathpalia responds to the email, calling for reporting the numbers. Mail is marked to CFO and Khurana. “We need to do the reporting. There seems to be a huge impact…..”

Dec. 11 – A final number on the financial impact is arrived at. The total impact is estimated to be Rs 1,572 crore. 

Dec. 16 – CFO writes to Kathpalia and Khurana confirming the final impact figure. Kathpalia responds the same day, seeking details of hit on capital adequacy of the bank. Khurana seeks external validation of the financial hit estimated by internal team.

Dec. 17 – CFO responds with details of hit on capital adequacy. Kathpalia responds to this expressing serious concern: "This is against what we have been talking to investors. It seems we need to go to Market early next year. This is very very serious. Pls have these calculations on derivatives again revalidated."

Jan. 17, 2024 – CFO says a consultant is being engaged to look at internal estimates of financial impact. It is later revealed this consultant is KPMG.

Feb. 21 – KPMG's investigation pegs the financial hit at Rs 2,093 crore. These figures were neither reported through the exchange platform till March 10, 2025, nor were being classified to be unpublished price sensitive information till March 4, 2025.

Feb. 29 – KPMG clarifies in a mail that it wants to have a meeting with bank officials to clarify and validate all the numbers including accounting entries.

March 10, 2025 – IndusInd Bank disclosed discrepancies in its derivatives portfolio, estimating a potential financial impact of 2.35%—approximately Rs 1,900–2,000 crore. The bank said it had initiated a review via an external agency, later revealed to be PwC.

March 15 – Amid rising depositor anxiety, the Reserve Bank of India stepped in with a public assurance that the issue was internal and under control. The central bank clarified there was no systemic risk and that depositors need not worry.

March 20 – The bank’s board escalated the matter by commissioning a deeper investigation, this time appointing Grant Thornton to identify the root cause and fix accountability.

April 22 – The issue widened. IndusInd Bank revealed fresh concerns related to its microfinance accounting. An internal audit, supported by EY, was launched to investigate the new irregularities.

April 27 – Findings of the Grant Thornton probe were released. The report confirmed a financial impact of Rs 1,960 crore, consistent with earlier estimates. It also identified individuals responsible for the trading mishap, and the board said appropriate disciplinary action had been taken.

April 28 – Khurana, who oversaw the treasury division at the time of the derivatives trading missteps, resigned, citing accountability.

April 29 – Kathpalia followed suit, stepping down in response to the crisis under his watch, marking a significant leadership reset.

April 30 – The board appointed two executives to manage operations until a new CEO was found, suggesting an interim arrangement as the bank worked through the fallout.

May 9 – New concerns emerged. Based on Grant Thornton’s report, the board disclosed it was investigating insider trading allegations. This admission followed a media report.

May 15 – Two further accounting issues came to light. The bank admitted to Rs 674 crore in incorrectly recognised microfinance income and Rs 595 crore of unsubstantiated balances in ‘other assets’. While these gaps were reportedly corrected in January, their delayed disclosure raised further concerns about transparency.

May 28 – The SEBI barred Kathpalia and four others from dealing in the share market, claiming that they were aware of unpublished price-sensitive information about the lender's derivative trades. The order said the management was aware of discrepancies but did not reveal it for nearly 15 months.