Business EconomyPosted at: Apr 29 2025 8:31PM


IndusInd Bank’s CEO Sumanth resigns due to ongoing ‘derivatives' discussion

Hyderabad/ Mumbai, Apr 29 (UNI) A day after the resignation of Induslnd bank’s Deputy CEO Arun Khurana in the wake of accounting lapses costing Rs 1,960 crore in the fiscal ended March 2025 to the lender, IndusInd Bank’s CEO Sumanth Kathpalia has also resigned with immediate effect on Tuesday.
In his resignation letter sent to the Board of Directors of the Bank, Sumanth said” I wish to submit my resignation from the services of the Bank in relation to the ongoing ‘Derivatives’ discussion''.
''I undertake moral responsibility, given the various acts of commission/Omission that have been brought to my notice. I would request that my resignation be taken on record at close of working hours today”, Sumanth (whose tenure has till March, 2026) said in his resignation letter.
Now the bank will have to look for a new CEO and until then they formed a committee of executives to look after.
Last month, RBI approved a one-year extension for the bank’s MD and CEO Sumant, as opposed to the three years approved by the board.
The CFO position in the bank is vacant as they have a Deputy CFO currently.
In his letter to the Bank’s board on Monday, Arun Khurana, said “Considering the recent unfortunate developments, wherein the Bank determined an adverse accounting impact on P&L, on account of incorrect accounting for internal derivative trades, I having oversight of the Treasury Front office function, as the Whole Time Director, Deputy CEO and a part of Senior Management of the bank, hereby resign, effective immediately.
Indusind bank board appointed an independent professional firm to conduct a comprehensive investigation on March 20, 2025, to identify the cause of the bank's financial discrepancies.
The independent firm submitted its report to the Bank on April 26, 2025, after which the Bank determined that the total financial impact to be at ₹1,959.98 crores as of the financial year ended 2024-25.
“The Report also examined the roles and actions of key employees in this context. The Board is taking necessary steps to fix accountability of the persons responsible for these lapses and re-align roles and responsibilities of senior management,” said IndusInd Bank in an exchange filing.
Grant Thornton, was appointed to investigate and determine an adverse accounting impact on IndusInd Bank's P&L to the tune of ₹1,959.98 crore.
The agency identified incorrect accounting of internal derivative trades, particularly early terminations, leading to notional profits & accounting discrepancies.
Earlier this month, PwC’s report on derivative portfolio discrepancies had quantified negative impact as of June 30, 2024 to be at Rs 1,979 crore.
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