The Serious Fraud Investigation Office (SFIO) has initiated a formal investigation into IndusInd Bank Ltd following the detection of significant accounting irregularities in its derivatives portfolio, involving a financial impact of nearly ₹1,960 crore, the bank disclosed in a regulatory filing.
In a statement submitted to stock exchanges on December 24, 2025, IndusInd Bank confirmed that it received a communication dated December 23, 2025, from the SFIO, informing the lender that an investigation has been launched under Section 212 of the Companies Act, 2013.
SFIO Probe Under Section 212 of Companies Act
Section 212 of the Companies Act empowers the Central Government to assign complex and high-value corporate fraud cases to the SFIO. The provision enables investigations based on reports from regulators, public interest considerations, special resolutions, or government directives, granting the agency extensive authority to examine financial misconduct.
RBI Mandated Reporting of High-Value Frauds
Earlier, on December 18, 2025, IndusInd Bank stated that the RBI Master Directions on Fraud Risk Management, issued on July 15, 2024, require banks to report all frauds exceeding ₹1 crore not only to the Reserve Bank of India but also to the SFIO under the Ministry of Corporate Affairs.
In compliance with these guidelines, the bank reported multiple issues to the SFIO on June 2, 2025, including:
- Accounting of internal derivative transactions
- Certain unsubstantiated balances under “other assets” and “other liabilities”
- Discrepancies related to microfinance interest and fee income
External Auditors Flag Nearly ₹2,000 Crore Impact
The accounting lapses came to light after an external auditor, in April 2025, identified a cumulative adverse impact of ₹1,959.98 crore on the bank’s profit and loss account as of March 31, 2025, stemming from discrepancies in derivative accounting.
Subsequently, on April 15, 2025, IndusInd Bank disclosed findings from another external agency, which estimated the negative impact of the derivative portfolio lapses on the bank’s net worth at approximately ₹1,979 crore.
Impact on Net Worth and Financial Health
According to the bank’s assessment, the discrepancies have resulted in an adverse post-tax impact of 2.27% on its net worth as of December 2024. In a later disclosure, the bank revised the estimated impact to around 2.35% of net worth, reflecting updated calculations related to derivative transactions.
Market Reaction
IndusInd Bank’s shares were trading around ₹848 on the NSE on December 24, 2025, with intraday movements reflecting investor caution amid regulatory scrutiny and the ongoing SFIO investigation.
Disclaimer:This article is for informational purposes only and is based on publicly available information. It does not constitute legal, financial, or investment advice. The publisher is not responsible for any loss arising from reliance on this content.
