IndusInd stock plunges on derivatives lapse

The shares fell 27.2%, wiping off more than ₹19,000 crore in market capitalisation

- Shayan Ghosh, Ram Sahgal, Anshika Kayastha & Varun Sood

Shares of IndusInd Bank plunged 27.2% on the bourses on Tuesday, a day after the private sector lender flagged discrepancies in its derivatives portfolio, sending panicked investors scrambling to sell counters. Earlier, CEO Sumant Kathpalia got a one-year extension from the banking regulator instead of three, and he pointed to the derivatives issue as probable cause for not being given a three-year term.

On Monday, the Hinduja group-promoted bank said it has appointed an external agency to investigate the derivatives lapse while keeping the Reserve Bank of India (RBI) in the loop. The bank had said in its December quarter presentation that its treasury has the "best-in-class risk management system".