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IndusInd Bank falls behind Bandhan and Federal Bank in FY25 profit after Q4 loss

Published on: May 21, 2025, 10:11 pm

Source: CNBCTV18

Private lender IndusInd Bank reported its first quarterly loss in 19 years, dragging its full-year net profit down to ₹2,575 crore in FY25 — placing it behind smaller peers such as Bandhan Bank and Federal Bank. In comparison, Federal Bank posted a net profit of ₹4,159 crore, while Bandhan Bank reported ₹2,745 crore for the same period.


For the March quarter of FY25, the Mumbai-based lender reported a net loss of ₹2,329 crore, compared to a net profit of ₹2,349 crore a year earlier. Analysts polled by CNBC-TV18 had estimated a much smaller loss of ₹514 crore for the quarter.


The steep loss stemmed from multiple accounting discrepancies that came to light over recent months. In April, the bank disclosed that ₹674 crore had been incorrectly recorded as interest income in its microfinance business over three quarters. On May 21, the bank revealed an additional ₹173 crore had been wrongly booked as fee income in the same segment, also over three quarters ending December 2024. Both amounts were reversed in Q4FY25.


Also Read: IndusInd Bank Q4 Results: Net loss of ₹2,328 crore a first in 20 years as accounting issues, MFI stress weigh


These lapses came on top of a ₹1,960 crore discrepancy related to the bank’s derivatives portfolio, which had earlier prompted the resignation of CEO Sumant Kathpalia.


Additionally, an internal financial review uncovered further misstatements — including nearly ₹100 crore in interest payments on certain borrowing instruments that had not been recognised in earlier P&L accounts. The bank also made a provision of ₹133.25 crore for unrecoverable balances in ‘other assets’ and accounted for ₹206 crore in prior-period operating expenses, while reversing ₹126.75 crore of income recorded incorrectly in earlier periods.


“We are looking forward to rebuilding the bank. Our fundamentals are strong, and we aim to build a healthier balance sheet starting FY26,” said Sunil Mehta, Chairman of IndusInd Bank. “The management is working relentlessly to transform IndusInd into a strong, future-ready bank.”


Also read: IndusInd Bank board to submit CEO picks to RBI before June end


Despite the setback, IndusInd remains the fifth-largest private lender in India by loan book size, with advances of ₹3.5 lakh crore. By contrast, Federal Bank and Bandhan Bank reported loan books of ₹2.3 lakh crore and ₹1.3 lakh crore, respectively.


IndusInd’s net interest income (NII) declined 8% to ₹19,031 crore in FY25, while pre-provision operating profit (PPoP) fell 33% to ₹10,661 crore. Gross non-performing assets (GNPA) rose to 3.13% in March 2025, from 2.25% in December 2024.


Ahead of the results announcement, IndusInd Bank shares closed 2% lower at ₹769.95 on the NSE, taking its year-to-date decline to 20%. In comparison, the Nifty Bank index has gained 8.3% in the same period.

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