Industry Bank revealed on Tuesday that an external audit had identified a negative impact of RS 1 979 crosses on its net value resulting from the gaps in its derivative portfolio. The bank said that this represents a negative impact of 2.27% on its net value in 2024.
In a regulatory file, the lender confirmed that the financial implications of this derived issue will be reflected in its financial statements for the financial year 25. The development follows the previous decision of the bank to appoint an independent audit firm to investigate the irregularities linked to its derived transactions.
Derivative differences had caused an internal examination and triggered concerns among investors and analysts. With the audit now completed, Industry Bank has recognized the conclusions and should integrate the adjustments required in its next financial reports.
The lender had previously projected a negative impact of 2.35% on the net value by the internal audit, while an external agency report now suggests a figure slightly 2.27% lower. Last month, the bank recognized the differences in account sales linked to its derivative portfolio. The internal audit initially estimated a negative impact of 2.35% on the net value of the bank in December 2024. In addition, the bank revealed the current external examination to validate the internal results.
“On March 10, 2025, the bank revealed that it noted certain differences in the accounts of its derivative portfolio. The internal revision of the bank had estimated an unfavorable impact of approximately 2.35% of the bank’s net value from 2024 December.
In a previous statement, Sumant Kathpalia, Managing Director and CEO of Industry Bank, said that any loss suffered in the derivative portfolio will be covered by the profit and loss account in the fourth quarter of financial year 25. He specified that it was not planned to use general reserves for this purpose.
In early trade on Tuesday, Industry Bank shares jumped 8% to Rs 741.10 on ESB. The share of the lender of the private sector lender experienced a 20% increase compared to its hollow of Rs 618.05 last week on April 7. This follows a lower 52 weeks of Rs 605.40 on March 3, 2025. Tuesday, the title ended at Rs 735.85, up + 6.84%.
As of December 31, 2024, the bank’s net value amounted to RS 65,102 crosses, exceeding the figure of the previous year of 58,841 crushes from December 31, 2023. Industry Bank assured that any impact resulting from exams of external agencies will be reflected with precision in the financial statements for the year 2024-25. In addition, the bank will work to improve internal controls linked to derived accounting operations.
Earlier this month, after the MPC meeting, the governor of the Reserve Bank of India, Sanjay Malhotra, described the industrial crisis as an “episode” rather than a failure for the entire banking system. Addressing the media following the announcement of the MPC, Malhotra assured that the country’s banking system remains “safe and secure”. Asked about potential systemic concerns related to accounting failures, Malhotra has rejected them as simple “episodes” declaring that such occurrences are inevitable.
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