Sebi probe turns focus on role of IndusInd board

The market regulator's map of IndusInd Bank's derivatives fiasco appears to contradict its chairman's claim that the board was kept in the dark, raising questions about whether the board should be held accountable in such cases.

- Shayan Ghosh & Neha Joshi

On 21 May, IndusInd Bank chairman Sunil Mehta said the board was not informed of the derivatives discrepancies and that it took swift measures when it came to know. However, an investigation by the Securities and Exchange Board of India (Sebi) found that though the bank disclosed the matter to exchanges on 10 March, 2025, the board had hired KPMG as early as 29 January, 2024 to review the discrepancies revealed by an internal team.

The day after the bank disclosed the discrepancies, its shares crashed 27%.

Sebi's interim order says IndusInd Bank formed the internal team in September 2023, after a central bank diktat on banks' investment portfolios in the same month. The bank then asked KPMG to validate its findings. Sebi said KPMG gave a figure of ₹2,093 crore to the bank, suggesting the negative impact due to discrepancies, till 31 December 2023, in an email on 21 February 2024.

Emails sent to the Reserve Bank of India, Sebi, IndusInd Bank and Mehta remained unanswered.