RBI Assures IndusInd Bank Depositors Following Financial Health Concerns

The Reserve Bank of India (RBI) reassured IndusInd Bank depositors about the bank’s financial stability amid recent concerns.

The central bank affirmed that the bank is well-capitalized and there is no need for depositors to worry.

In a statement released on its website, the RBI urged depositors not to react to speculative reports.

“There is no need for depositors to react to the speculative reports at this juncture,” the central bank stated.

It further highlighted that the financial health of IndusInd Bank is stable and closely monitored.

The RBI provided key financial metrics to underline the bank’s sound position.

As of 31 December 2024, IndusInd Bank reported a Capital Adequacy Ratio (CAR) of 16.46%, and a Provision Coverage Ratio (PAR) of 70.20%.

These figures suggest a strong capital base and provisions to cover potential loan losses.

Further bolstering its liquidity position, the bank reported a Liquidity Coverage Ratio (LCR) of 113% as of 9 March, 2025, comfortably above the regulatory requirement of 100%.

This indicates that the bank has ample liquidity to meet its financial obligations.

The RBI also highlighted that IndusInd Bank has enlisted an external audit firm to examine its operations and evaluate the effects of recent events.

The external review aims to address discrepancies in the bank’s derivatives portfolio, which the bank had earlier flagged.

These discrepancies are expected to affect around 2.35% of the bank’s net worth as of December 2024.

The RBI directed IndusInd Bank’s Board and management to take necessary corrective actions within the current quarter (Q4 FY25) and ensure proper disclosures to stakeholders.

The statement further reassured depositors by reminding them of the RBI’s strong track record in safeguarding customer interests during financial uncertainties.

The central bank cited previous interventions with institutions such as:

• Yes Bank in 2020,
• RBL Bank in 2021,
• The collapse of Global Trust Bank in 2004, and
• ICICI Bank’s liquidity concerns after the Lehman crisis in 2008

The RBI stressed that the situation at IndusInd Bank is not a crisis but rather a one-time accounting issue.

The bank is currently taking corrective measures to resolve the discrepancies and restore full financial transparency.

Also Read: Tata Communications Appoints N Ganapathy Subramaniam As Chairman