IndusInd Bank Examining Insider Trading Angle After Audit Report

IndusInd Bank Ltd. on Friday said it is examining the findings of an audit report by Grant Thornton which hints at likely insider trading.

Clarifying media reports, the lender said the audit report delivered on April 26 identified certain aspects, which may require a determination from an "insider trading perspective."

"The bank is examining these findings in the report and based on the outcome of such examination, the bank will take the necessary steps under applicable law (including the bank’s Insider Trading Code)," the bank said in a stock exchange filing.

After accounting discrepancies in the bank's derivatives business cropped up in March, IndusInd Bank appointed an independent professional firm to conduct a comprehensive investigation to identify the root cause of the discrepancies.

The firm determined a cumulative adverse accounting impact on its profit and loss statement at Rs 1,959.98 crore as of March 2025.

The Grant Thornton report identifies that the incorrect accounting of internal derivative trades, particularly in cases of early termination, led to the recording of notional profits, which is cited as the principal root cause for the accounting discrepancy according to IndusInd's public disclosure last month.

The report also examined the roles and actions of key employees in this context.

The board is taking the necessary steps to fix accountability for the persons responsible for these lapses and realign the roles and responsibilities of senior management, the bank said.

The derivatives trouble has led to exits in the top management following the Grant Thornton report. Other employees of the private lender are also likely to come under scrutiny, three persons aware of the matter told NDTV Profit.

Employees in the treasury, audit, risk, operations and other adjacent departments are undergoing investigations, two people said.

Beyond these accounting discrepancies, the bank has also recently found discrepancies in IndusInd Bank's microfinance portfolio. On April 22, the bank disclosed that it had identified this issue and that the internal audit department at IndusInd Bank was investigating it. Global consulting firm EY is supporting the internal audit department in this investigation.

Shares of IndusInd Bank closed 0.9% lower at Rs 817.85 on the BSE, ahead of the announcement, compared to a 1.1% decline in the benchmark Sensex. The stock has fallen 42% in the past 12 months and by 16% so far this year.