IndusInd Bank Q1 Update: Net Advances Slip 3% Amid Accounting Fraud Fallout

IndusInd Bank’s net advances fell 3.1% sequentially to Rs 3.34 lakh crore crore in April-June, according to provisional numbers disclosed by the lender on Friday. On a year-on-year basis, it slipped by 4%.

These quarterly figures are crucial as they have come in the backdrop of a recent high-profile derivative scandal that has rattled investor confidence and market sentiment around the bank.

The lender's corporate banking advances fell sharply by 14.4% YoY and 6.2% quarter-on-quarter. Consumer business advances dipped by 0.9% on a sequential basis, but rose 4.8% YoY.

The crisis-hit bank's deposits were also down, as they slipped 3.3% sequentially and 0.3% on-year to Rs 3.97 lakh crore.

Retail deposits and deposits from small business customers stood at Rs 1.84 lakh crore, slightly lower than Rs 1.85 lakh crore a quarter ago.

The current account and savings account, or CASA ratio also fell to 31.49% from 32.81% in the previous quarter, indicating a drop in low-cost deposits.

The daily average liquidity coverage ratio for the quarter was robust at 141.27%, with a slight increase to 145.26% as of June 30, 2025.

The bank’s Q1 business update comes amid the ongoing scrutiny following a recent derivative trading scandal that has cast a shadow over its financial stability and governance practices.

The scandal, which involved unauthorised derivative transactions leading to significant losses, has triggered regulatory investigations and shaken investor trust.

This backdrop has likely contributed to the cautious lending approach reflected in the decline in corporate advances and the dip in deposits.

The drop in the CASA ratio also signals potential challenges in maintaining low-cost funding sources, which are critical for the bank’s profitability.

While the consumer business segment shows some growth, the overall cautious tone in advances and deposits suggests a period of consolidation for IndusInd Bank.

The bank’s ability to restore confidence, strengthen governance, and stabilise its financial metrics will be critical in the coming quarters.