IndusInd Bank CEO Sumant Kathpalia quits: A look at the events that unfolded

Kathpalia’s resignation comes a day after the lender’s long-time director and deputy CEO, Arun Khurana, stepped down.

“…we hereby inform you that Mr Sumant Kathpalia, Managing Director & CEO, Key Managerial Personnel of the Bank, has by his letter dated April 29, 2025, resigned from services of the Bank with effect from close of working hours on April 29, 2025,” the company said in a statement to the stock exchanges.

The lender’s board has sought approval of the Reserve Bank of India (RBI) “to constitute a ‘Committee of Executives’ to discharge the duties, roles and responsibilities of the CEO of the Bank for an interim period until a permanent CEO is appointed by the Bank.”

In his resignation letter, outgoing CEO Sumant Kathpalia said, "I undertake moral responsibility, given the various acts of commission/omission that have been brought to my notice. I would request that my resignation be taken on record at close of working hours today. I would like to thank the Regulators, Board, my Management Team members and staff for the support I got during my tenure of 5 years as the CEO."

These top-level resignations come after the lender on Sunday (April 27) said it would take action against employees responsible for lapses and realign senior management roles.

This is similar to the amount disclosed on April 15, 2025.

"The bank will appropriately reflect the resultant impact of the accounting discrepancies in the financial statements for FY 2024-25 and take measures to strengthen internal controls accordingly. The bank has already discontinued internal derivative trades from 1st April 2024," IndusInd Bank said in its filing to the stock exchanges on Sunday.

"The report also examined the roles and actions of key employees in this context. The board is taking necessary steps to fix accountability of the persons responsible for these lapses and realign roles and responsibilities of senior management," it added.

On March 10, 2025, IndusInd Bank had disclosed that the bank had noted some discrepancies in its derivatives portfolio which could have an adverse impact of about 2.35% of the bank's net worth as of December 2024 as per its internal review.

The bank had, in parallel, appointed an external agency to independently review and validate the internal findings.

In March 2025, the Reserve Bank of India (RBI) granted only a one-year extension to Sumant Kathpalia as MD and CEO of IndusInd Bank.

This is despite the bank's board requesting a three-year reappointment.

This marked the second consecutive time that the RBI had approved a shorter tenure instead of a full three-year term for Kathpalia.

In September 2024, the board had approved Kathpalia's reappointment as MD & CEO for a three-year term, from March 24, 2025, to March 23, 2028.

Kathpalia was heading IndusInd Bank since March 2020. Previously, the RBI approved a two-year extension to Kathpalia in March 2023 while the bank's board had approved his re-appointment for three years.