IndusInd Bank Shares Plunge 20% On Reporting 11% Fall In Deposits

On Tuesday, shares of IndusInd Bank crashed as much as 19.99 percent to an intraday low Rs 330.75 on NSE, a day after the company said its total deposits fell by approximately 10-11 percent.

On Monday, the private bank released its presentation for the 'Analyst / Investor Call' in a stock exchange filing which informed that it total deposits may have fallen by approximately 10-11 percent.

"Almost 2/3rd of reduction is on account of Government related accounts - this is largely related to general private sector bank stance. This will also result in lower CASA ratio, but reduce our dependency on this category for deposits in future," it said.

The bank also said that there was a "some" reduction in wholesale deposits which "possibly attributable to stock price fall" however, retail reduction is least of the deposit categories.

"Currently deposits more stable and flows recommenced. NIMs expected to remain stable," it added.

IndusInd Bank said it plans to replace deposit outflows with longer duration Refinance / FX borrowings swapped to INR, Bank CD and Term money borrowings, Repo of excess SLR/ Non SLR securities and Call money, in order of inflow size.

"The Bank did not dip into other lines of credit like the Marginal Standing Facility (MSF)," it said.

The private lender has lost over 65 percent in share value after the Yes Bank reconstruction that triggered large and small depositors to move their deposits out of mid-sized private banks to public-sector banks.