Mumbai: In the amidst increased pressure, Sumant Kathpalia Managing Director and CEO of Bank of India has resigned, resigning immediately, taking moral responsibility for the differences in lenders’ derivatives, thus eroding its Network.
His resignation came the second day after bank deputy chief executive Arun Khurana was also associated with the same issue. Its chief financial officer Govind Jain resigned in January and then failed.
The bank’s board of directors has sought approval from the Reserve Bank of India to form a “executive committee” to perform the duties, duties and responsibilities of the CEO until the bank appoints a permanent CEO, and the lender informs the exchange.
Accounting errors disclosed on March 10 resulted in losses of nearly Rs 2,000 crore. In the issue of derivative losses, the exit of the bank’s CFO Gobind Jana and the decision of CEO Kathpalia and deputy CEO Khurana to sell shares worth Rs 157 crore in the past two years have attracted attention.
“I hope to make a resignation from the bank’s services in the ongoing derivatives discussion. I conduct ethical
In view of the various commission/omitted behaviors I have noticed, liability. I asked today to record my resignation at the end of work hours. ” Kepalia said in her resignation letter.
Khurana
The impact of adverse capital on bank balance sheets.
The Reserve Bank of India reportedly recommended that Kathpalia and Khurana resign after the accounting issues were over. Regulators are believed to have raised concerns about the lapses in supervision and internal controls in the business of the bank’s finance ministry.
Kathpalia was appointed CEO of MD& in March 2020. He replaced Romesh Sobti, who has led the bank for more than a decade. Prior to this, Kathpalia led Indusind’s consumer banking division and is headquartered in Delhi. Earlier, he led the consumer lending division of ABN Amro Bank and joined Indusind in 2008 with Sobti and others.
On Sunday, Industrial Bank revealed that Grant Thornton determined that incorrect accounting of internal derivative transactions, especially in the case of early termination, was the root cause of the problem. These transactions result in records of nominal profits, which in turn leads to significant accounting differences. The company estimates that the bank’s adverse impact on the bank’s profit and loss statement was Rs 19,599.8 crore as of March 31, 2025.
According to the investment directive issued by the Reserve Bank of India in September 2023, banks are prohibited from conducting internal transactions/helding, so from April 1, 2024, IndusInd Bank has stopped internal transactions too much. However, in an internal review, the bank identified certain differences in an internal review, which was in the case of an Excelex loss in order to involve a previous downgrade/April 5, 2024 (over April 5, 2024), which was not recognised by NII (net interest income), while the corresponding fiscal earnings were recognized in the profit and loss statement. The Ministry of Finance uses derivatives to convert foreign exchange deposits/borrows into rupees.
