IndusInd Bank shares collapse 11% after issuance of perpetuity loan

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Shares of private lender IndusInd Bank fell 11% on Monday morning, despite the bank’s clarification of whistleblowers’ allegations of permanent renewal loans.

At 10:09 am, IndusInd Bank was trading at 1,060.60 on BSE, down 128.15 or 10.78%. It had opened at 1,125 against the previous close of 1,188.75. It hit an intraday high of 1,126.95 and a low of 1,053.45.

IndusInd Bank Says Whistleblower Claims Unfounded; granted 84,000 loans without client consent in May

On the NSE, it was trading at 1,055.40, down 133.70 or 11.24%.

IndusInd Bank has launched an independent review of its microfinance arm Bharat Financial Inclusion Ltd (BFIL) to see if there was a process failure or accounting failure after a whistleblower complaint.

Under fire from critics, IndusInd Bank begins review of its microfinance subsidiary

A news report on Friday said anonymous whistleblowers wrote to the bank’s management and the RBI about BFIL, the bank’s microcredit-focused subsidiary, with allegations of loan renewals.

Corrective action if necessary

The company had clarified that all loan products managed by BFIL, which provides micro-loans to women in rural India, as a business correspondent, are approved by IndusInd Bank and fully comply with regulatory guidelines in force, published from time to time. .

However, he said his subsidiary disbursed nearly 84,000 loans in May 2021 without customer consent due to a technical glitch, although he denied claims of constant greening of loans.

She initiated an independent review of BFIL.

“If necessary, the Bank will immediately take appropriate corrective measures and keep all stakeholders sufficiently informed. The Bank has followed a prudent provisioning approach and reiterates that there is no change in the estimates of the cost of credit, including in the microfinance sector, ”IndusInd Bank said in a statement.


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