RBI Assures Stability of IndusInd Bank

The Reserve Bank of India (RBI) has recently announced that IndusInd Bank is financially stable and adequately capitalized, urging depositors to disregard speculative reports. The central bank has mandated the bank's Board and management to resolve discrepancies in its derivatives portfolio by March 31, 2025, ensuring all stakeholders are informed.

Discrepancies in Derivatives Portfolio

IndusInd Bank disclosed on Monday that it had identified discrepancies in the valuation of its foreign exchange derivative portfolio. The bank admitted that the hedges taken to protect against forex risk on its foreign currency borrowings were not properly valued, potentially leading to a Rs 2,100 crore hit on its pre-tax earnings.

RBI's Statement on Financial Health

The RBI emphasized that IndusInd Bank's financial health is stable, with a Capital Adequacy Ratio of 16.46% and a Provision Coverage Ratio of 70.20% as of December 31, 2024. The bank's Liquidity Coverage Ratio (LCR) was reported at 113% as of March 9, 2025, surpassing the regulatory requirement of 100%. The RBI has directed the bank to complete remedial actions by the end of the current quarter, ensuring transparency with all stakeholders.