The shares of the lender rose to Rs 72.24 apiece on Tuesday afternoon, before erasing all gains. This comes a day after the stock tumbled 16%, recording its worst single-day drop since March 2020, after the bank discovered fraudulent activity by its employees at one of its branches in Chandigarh.
Here’s what Haryana CM said:
According to Saini, Rs 556 crore, which includes Rs 22 crore in interest, has been returned within 24 hours. “No one, whether a bank employee, a private individual, or a government official, will be spared in the case,” he said while speaking at the Haryana Assembly.
The Chief Minister added that four or five middle and lower-level employees of the bank branch in Chandigarh colluded to carry out this operation.
Saini promised to take strict action against any government official or employee involved in the alleged fraud. “We would form a high-level committee that would not only hold the officers and employees involved in this matter accountable but would also make suggestions to prevent future situations like the one that has arisen today,” he added.
He assured lawmakers that Haryana’s financial management has strengthened under the current administration and underlined that the state’s 2.8 crore citizens’ money remains fully accounted for.All about Rs 590-crore fraud at IDFC First Bank branch:
IDFC First Bank on Saturday said it has identified an incident of alleged fraud by some employees at one of its Chandigarh branches, involving accounts related to the Haryana government.
The lender suspended four suspected officials pending investigation. It said that it will pursue strict disciplinary, civil and criminal action against the employees and other external individuals as per the law. The bank also filed a police complaint and sent a recall request to certain beneficiary banks to “lien mark balance in suspicious accounts held in these banks”.
In another exchange filing released on Sunday, IDFC First Bank said it has appointed KPMG to initiate an independent forensic audit in this matter.
What to expect for IDFC First Bank shares?
After the sharp uptick seen in the stock price mid-afternoon, the shares erased all gains and were trading flat, as seen at 2.40 pm.
Motilal Oswal Financial Services had said that with Rs 590 crore worth of deposits at risk, the actual financial impact will depend on the quantum and timing of recoveries as determined by the findings of the ongoing forensic audit and subsequent legal recovery process.
“We believe that in a worst-case scenario assuming negligible recovery, the provisioning requirement will impact 4QFY26 PBT by 56%,” the domestic brokerage said.
Investec maintained a ‘Buy’ rating but cut its target price to Rs 92 from Rs 105. It noted that the final impact will depend on ongoing investigations, recoveries, and the validation of claims.
Jefferies had said that IDFC First Bank will need to strengthen operational controls and clarify that the issue has not spread to other clients. Nomura’s Ankit Bihani said the impact to the bank’s financials will depend on potential recoveries made through the liens marked on fraudulent beneficiary accounts maintained with other banks, liabilities of entities involved in the transactions and the legal recovery process.
While pointing out concerns around governance and branch-level controls, Bihani said that given IDFC First Bank’s retail deposit-led model, reputational perception remains critical, and the stock could remain under pressure until forensic findings and the financial impact are clearly established.
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