MUMBAI: The Reserve Bank of India has said that IndusInd Bank is adequately capitalised and financially stable and there is no need for depositors to react to speculation. The central bank has also directed IndusInd Bank’s Board and management to resolve discrepancies in its derivatives portfolio, disclosed on Monday, by March 31, 2025, after informing all stakeholders.
In a voluntary disclosure on Monday, IndusInd Bank had said that it had noticed discrepancies in the valuation of its foreign exchange derivative portfolio. The hedges taken by the bank to protect against forex risk on its foreign currency borrowings were not properly valued, which could lead to a Rs 2,100 crore hit on its pre-tax earnings, the bank said.
The central bank stated that IndusInd Bank’s financial health is stable and that there is “no need for depositors to react to the speculative reports at this juncture.”
None of the rating agencies have stated that they are reviewing their opinion on the bank. In its last review in 2024, India Ratings assigned a AA+ rating to the private bank.
“The RBI would like to state that the bank is well-capitalized, and the financial position of the bank remains satisfactory. As per auditor-reviewed financial results for the quarter ended December 31, 2024, the bank has maintained a comfortable Capital Adequacy Ratio of 16.46 per cent and Provision Coverage Ratio of 70.20 per cent,” the RBI said in a statement.
The bank’s Liquidity Coverage Ratio (LCR) was 113 per cent as of March 9, 2025, compared to the regulatory requirement of 100 per cent, the RBI added.
Based on publicly available disclosures, the RBI noted that the bank has already engaged an external audit team to comprehensively review its current systems and assess and account for the actual impact promptly.
“The Board and management have been directed by the Reserve Bank to complete the remedial action during the current quarter, i.e., Q4FY25, after making the required disclosures to all stakeholders,” the RBI said.
