Synopsis
According to a recent report, IndusInd Bank is expected to appoint a new CEO to succeed Sumant Kathpalia within six months. The Reserve Bank of India will finalize the candidate list, which may include both internal and external options, by October.Key Takeaways
- IndusInd Bank may appoint a new CEO soon.
- Sumant Kathpalia's successor will be chosen by the RBI.
- Potential candidates need to be submitted six months in advance.
- Investigation into accounting discrepancies is underway.
- RBI assures depositors of the bank's stability.
New Delhi, March 22 (NationPress) IndusInd Bank is poised to appoint a new CEO, who will succeed Sumant Kathpalia, within the next six months. This transition will occur once the potential candidates are submitted to the Reserve Bank of India (RBI), which will then determine Kathpalia’s successor.
As per a report from NDTV Profit, the board is expected to finalize the replacement by October. It remains uncertain whether the shortlist will include only external candidates or if internal options will also be considered.
Typically, a bank’s board is required to submit names of potential CEOs to the regulator at least six months prior to the end of the incumbent’s tenure.
The report, citing sources, indicates that the RBI is awaiting the completion of an accountability review before proceeding with any decisions. Should any significant accounting irregularities emerge at IndusInd Bank, the regulator will take necessary measures against those accountable.
On Thursday, IndusInd Bank announced the engagement of an independent professional firm to investigate discrepancies within its derivative portfolio. Last week, the bank revealed it had detected inconsistencies in its derivatives portfolio, potentially affecting approximately 2.35% of its net worth as of December 2024.
In a statement to the stock exchanges, the bank confirmed that this independent firm will carry out a thorough investigation to determine the underlying causes of the recently revealed accounting discrepancies. This investigation will evaluate the accuracy and implications of the accounting treatment of derivative contracts against current accounting standards.
The Board of Directors resolved to appoint an independent professional firm “to conduct a comprehensive investigation to, among other things, identify the root cause of the discrepancies, assess the correctness and impact of the accounting treatment of the derivative contracts with regard to the prevailing accounting standards/guidance, identify any lapses, and establish accountability,” as further stated in the filing.
Meanwhile, the RBI has provided assurances to IndusInd Bank depositors regarding its financial stability following recent rumors concerning its financial condition.
