Fraud at IDFC First Bank, Share Price Down

A ₹590 crore fraud has been reported at IDFC First Bank. The irregularity was discovered in the Haryana government’s account, and initial findings suggest that bank employees may have been involved.

At the time of writing, IDFC First Bank shares are trading 16% lower at ₹70, after having fallen as much as 20% earlier in the day. Reserve Bank Governor Sanjay Malhotra stated that the matter is being closely monitored and that there is no cause for concern. The bank’s capital adequacy ratio stands at 17%, well above the regulatory requirement of 11.5%.

Based on the RBI Governor’s clarification, it appears that there is no serious systemic crisis. However, following the incident, the Haryana government has barred IDFC First Bank from conducting government transactions.