IndusInd Bank Shares Slide As CEO Resigns Amid Big Accounting Lapse

IndusInd Bank fell nearly 3% on Wednesday after the resignation of CEO Sumant Kathpalia, who stepped down in the wake of an accounting scandal related to the bank's derivatives portfolio. 

Since the initial disclosure of the accounting issues on March 10, the stock has lost approximately 9% of its value.

Kathpalia, who has served as CEO since March 2020, accepted moral responsibility for the lapses. 

"I undertake moral responsibility, given the various acts of commission/ omission that have been brought to my notice," Kathpalia wrote in his resignation.

This high-level exit follows that of Deputy CEO Arun Khurana, who also stepped down amid the controversy on April 28.

In response to the leadership vacuum, the Reserve Bank of India (RBI) approved the formation of an interim executive committee to oversee the bank's operations. Soumitra Sen, head of retail lending, and Anil Rao, Chief Administrative Officer, have been appointed to manage day-to-day activities under the board's supervision .

Data on Stocktwits shows that retail sentiment has turned ‘bullish’ from ‘extremely bearish’ a week ago, amid high message volumes. 

IndusInd Bank stock has fallen 15% year-to-date (yTD)

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