Ashok Hinduja backs IndusInd Bank board amid fraud concerns, calls it a 'new dawn' for the lender
IndusInd International’s Ashok Hinduja backed the bank’s leadership after suspected internal fraud surfaced. He praised swift corrective action, regulatory compliance, and reaffirmed IIHL’s financial support. Despite accounting lapses, core opera...
By Akash Podishetti, ETMarkets.com |
ETMarkets.com
A day after IndusInd Bank revealed that it is suspecting fraud in accounting irregularities and flagged involvement of senior employees, Ashok Hinduja, Chairman of IndusInd International, has come out in strong support of the current leadership and the board.
In a statement following the bank’s Q4 FY25 results, Hinduja said he has “unequivocal trust” in the bank’s board and praised their swift action in addressing the discrepancies. “This will lead to higher standards of transparency and governance, rebuilding trust in the Bank,” he said.
On May 21, IndusInd Bank disclosed multiple accounting lapses, including inflated fee and interest income and misclassified asset and liability entries, leading the board to suspect internal fraud. The bank has already corrected its financials and informed regulatory authorities. A forensic probe is underway, and accountability measures have been initiated.
Despite the controversy, Hinduja emphasised that the bank’s core business remains strong. “The coordinated efforts of management and the board have kept the bank healthy, with robust capital adequacy,” he said, adding that customer confidence continues to hold steady.
Referring to the Reserve Bank of India (RBI), Hinduja appreciated the regulator’s “orderly and guided” approach in handling such issues in the past and expressed confidence in its continued oversight.
Importantly, Hinduja reiterated that IIHL remains committed to financially supporting IndusInd Bank, just as it has over the last three decades. “Even though capital adequacy is strong, if further equity is needed for business growth, we are fully committed,” he stated.
His comments aim to calm investor nerves following a week of reputational damage. The board has assured stakeholders that this marks a fresh chapter for the bank—“a new dawn with a sanitised slate”—as it works toward restoring the credibility it once enjoyed.
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
In a statement following the bank’s Q4 FY25 results, Hinduja said he has “unequivocal trust” in the bank’s board and praised their swift action in addressing the discrepancies. “This will lead to higher standards of transparency and governance, rebuilding trust in the Bank,” he said.
On May 21, IndusInd Bank disclosed multiple accounting lapses, including inflated fee and interest income and misclassified asset and liability entries, leading the board to suspect internal fraud. The bank has already corrected its financials and informed regulatory authorities. A forensic probe is underway, and accountability measures have been initiated.
Despite the controversy, Hinduja emphasised that the bank’s core business remains strong. “The coordinated efforts of management and the board have kept the bank healthy, with robust capital adequacy,” he said, adding that customer confidence continues to hold steady.
Referring to the Reserve Bank of India (RBI), Hinduja appreciated the regulator’s “orderly and guided” approach in handling such issues in the past and expressed confidence in its continued oversight.
Importantly, Hinduja reiterated that IIHL remains committed to financially supporting IndusInd Bank, just as it has over the last three decades. “Even though capital adequacy is strong, if further equity is needed for business growth, we are fully committed,” he stated.
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His comments aim to calm investor nerves following a week of reputational damage. The board has assured stakeholders that this marks a fresh chapter for the bank—“a new dawn with a sanitised slate”—as it works toward restoring the credibility it once enjoyed.
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
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