Kotak Mahindra Bank says KYC, processes in order as it reconciles missing Panchkula deposits worth Rs 150 crore

Kotak Mahindra Bank on Wednesday said it is reconciling fixed deposits and accounts linked with the Municipal Corporation of Panchkula, after media reports surfaced alleging that deposits worth Rs 150 crore were missing from these accounts.

In a statement, a spokesperson for the bank said the reconciliation was initiated following instructions from the Municipal Corporation itself, and that a significant portion of the amounts under review had already been reconciled.

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"Following instructions from the Municipal Corporation of Panchkula, Kotak Mahindra Bank initiated a detailed reconciliation of fixed deposits and linked bank accounts maintained by the Municipal Corporation," the spokesperson said. "Based on records examined so far, all account opening processes, KYC documentation, authorised signatories and instructions received from the Municipal Corporation were in order, and the accounts and transactions were handled in strict adherence to due process and applicable banking norms."

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The bank added that it has filed a formal complaint with the Panchkula Police — a step it described as consistent with its governance standards and aimed at ensuring the matter is examined independently and comprehensively. It said it is cooperating fully with the Municipal Corporation, government authorities, and law enforcement agencies.

The Kotak-Panchkula episode is not an isolated one. A similar matter had surfaced earlier when IDFC First Bank disclosed a Rs 590 crore discrepancy in Haryana government deposits maintained at its Chandigarh branch.

In a stock exchange filing, IDFC First Bank had said the issue came to light after a Haryana government department requested closure of its account and transfer of funds to another bank. During that process, discrepancies emerged between the balance reflected in the account and the amount the department believed it held. Subsequently, other Haryana government entities also approached the bank to close their accounts, revealing similar differences.

The disclosure followed a directive issued by the Haryana government on February 18, instructing its departments to close accounts held with private sector banks — a move that effectively triggered the chain of account closure requests that exposed the discrepancies.