IndusInd Bank shares fall 20% after Q2 profit drop, asset quality deterioration

[dvader]

Handling of demonetisation, Yes bank Failure, PMC fraud to name a few. RBI comes into action when it's already late hence can't be trusted. Better to park money elsewhere till things settle down.

You dont understand central bank dont you.
Demonitization was a Govt policy. RBI can give recommendations and it rightfully did, the board highlighted that the impact on black money might be small and it will disrrupt the economy in the short run. Now whether it was good or not is a separate matter.

No depositor lost a single rupee with YesBank that's an A+ grade for RBI. RBI came in action at the right time. I hope you understand difference between Magic and Reality. They came in action as early as practically possible.

PMC: RBI already had an advisory against cooperative and municipal banks. Even then ut tried to do the best it can. RBI regulates the parameter, it doesn't have a time machine to detect fraud. They have full timeline to payback every depositor, every single penny. Even though they could have gone just with 5L dicgc.

Again, if you don't believe in your central bank, why park money elsewhere, all banks would be worthless in that scenario.

Your logic is, I don't trust RBI for IndusInd but I trust them for all the other banks.

RBI is strong and competent regulator. You have no other choice than to trust them, no one in any country has a choice when it comes to central bank.

 

[Half Human]

No depositor lost a single rupee with YesBank that's an A+ grade for RBI. RBI came in action at the right time. I hope you understand difference between Magic and Reality. They came in action as early as practically possible.

PMC: RBI already had an advisory against cooperative and municipal banks. Even then ut tried to do the best it can. RBI regulates the parameter, it doesn't have a time machine to detect fraud. They have full timeline to payback every depositor, every single penny. Even though they could have gone just with 5L dicgc.

Again, if you don't believe in your central bank, why park money elsewhere, all banks would be worthless in that scenario.

Your logic is, I don't trust RBI for IndusInd but I trust them for all the other banks.

RBI is strong and competent regulator. You have no other choice than to trust them, no one in any country has a choice when it comes to central bank.

From my experience,..

Some people are delusional... (Maybe it is us, or maybe it is them). Some won't accept despite showing proofs and facts. I have stopped proving people facts.

Lucky are those who does not have that capacity to understand. For them, ignorance is a bliss. Let them be happy with their delusions

 

[Half Human]

Whose failure is fiasco of indusind? Who is responsible? Ans is Central Bank as they are watchdog...How come they are not aware that indusind has put money in derivatives.

We always compare ourself with worst and feel good about it

We should compare with those who are above/better than us so that we can grow and move forward.

I can answer this and contradict with proof.

But seeing chatrapati sivaji maharaj as dp, I refrain myself 👐

 

[hender]

Whose failure is fiasco of indusind? Who is responsible? Ans is Central Bank as they are watchdog...How come they are not aware that indusind has put money in derivatives.

We always compare ourself with worst and feel good about it

We should compare with those who are above/better than us so that we can grow and move forward.

What is your opinion on 16 lakh crore write off?

Handling of demonetisation, Yes bank Failure, PMC fraud to name a few. RBI comes into action when it's already late hence can't be trusted. Better to park money elsewhere till things settle down.

RBI says " जानकार बनिए सतर्क रहिए।"

Cash is king 👑,

 

[dvader]

Whose failure is fiasco of indusind? Who is responsible? Ans is Central Bank as they are watchdog...How come they are not aware that indusind has put money in derivatives.

We always compare ourself with worst and feel good about it

We should compare with those who are above/better than us so that we can grow and move forward.

There are no regulatory issues with IndusInd. The fiasco is completely separate from their banking business. Indusind has other investment businesses too. Up till 2024 there was no regulation against hedging and forex tranding by banks (again it's not clients money) so IndusInd used it's money to make bets but RBI was watching them and they released a regulation in Apr 2024 to stop such activities for all banks. IndusInd complied.

RBI is doing more than what a watchdog should do. They are now regulating things that might make a bank vulnerable in completely unrelated situations.

 

[sunit123]

I can answer this and contradict with proof.

But seeing chatrapati sivaji maharaj as dp, I refrain myself 👐

Japnaam...DP is not of Sivaji maharaj...I agree that some people are delusional.

 

[hender]

Comments like these make me facepalm hard. Trusting the central bank is not a choice. If you can't trust the Central Bank (of any country for that matter), your money is not worth the paper it's printed on, and not just for one bank (Indusind in this case), the money would be worthless in every bank. So you either except that your money is worthless and burn it or trust your Central Bank.

The central bank has to give a damn. They don't have a choice either just like us.

Eg. Look at Zimbabwe and Lebanon, Once the central bank lost trust, their money became worthless. They (Zim) use other currencies (US $, Australian $, etc) in their economy..

That was not a comparison. It's a case study in what happens when a central bank fails. I can't give you an example of a successful state with a failed central bank. I hope you get the logic.

And RBI is on PAR and in some cases better than most central banks in the world, granted it has more powers but looking at results it's way better than the US Federal Reserve and Japanese Central Banks in many scenarios. I don't think there are better central banks than those too.

Japanese Central Bank is world renowned for what they have been doing for the last 30-35 years.

US Fed has found itself powerless in the 15 years of quantitative easing and couldn't raise interest rates when it wanted to. Powerless against the bank failure of 2023. And I don't mean small bank or credit union (like cooperative bank in India) failures.

As opposed to what? carrying them on books for eternity (this is already over a decade)?? RBI is not a bank it's a central bank, Writing off bad loans is a regulatory measure and RBI is the most conservative in loan write-offs.

Given your recommendation of learning from countries bigger than India. Let's talk USA, The FED doesn't have much control over what is written off, banks tend to get their hands off bad debt as soon as possible. Should we start writing off more debt???

Is the write-off good? No of course not but the issue is unless we adopt the pre-1990 Japanese Central Bank policies (This was the time when the Japanese economy became bigger than USA's). At the time Japanese Central Bank had the authority on loan sanctions. Japanese economy boomed like nothing else. Until JCB had multiple Harvard graduates who thought that JCB should become more like the US Fed.

Every Central bank post-1990 (Except the Middle East) works like the US Fed and there will be periodic write-offs like these.

No legislator of any party in 21st century is gonna let any central bank in any country have a say in loan sanctions. That's just hard reality.

You dont understand central bank dont you.
Demonitization was a Govt policy. RBI can give recommendations and it rightfully did, the board highlighted that the impact on black money might be small and it will disrrupt the economy in the short run. Now whether it was good or not is a separate matter.

No depositor lost a single rupee with YesBank that's an A+ grade for RBI. RBI came in action at the right time. I hope you understand difference between Magic and Reality. They came in action as early as practically possible.

PMC: RBI already had an advisory against cooperative and municipal banks. Even then ut tried to do the best it can. RBI regulates the parameter, it doesn't have a time machine to detect fraud. They have full timeline to payback every depositor, every single penny. Even though they could have gone just with 5L dicgc.

Again, if you don't believe in your central bank, why park money elsewhere, all banks would be worthless in that scenario.

Your logic is, I don't trust RBI for IndusInd but I trust them for all the other banks.

RBI is strong and competent regulator. You have no other choice than to trust them, no one in any country has a choice when it comes to central bank.

Buddy, "GDP, Finance and Economy, and role of Central Bank, Challenges and Action" is not everyone's cup of tea.

Time to invite, and listen POV of Ex Governor Mr Shaktikanta Das and Dr Raghuram Rajan

 

[dvader]

Buddy, "GDP, Finance and Economy, and role of Central Bank, Challenges and Action" is not everyone's cup of tea.

Time to invite, and listen POV of Ex Governor Mr Shaktikanta Das and Dr Raghuram Rajan

Yeah that's a good Idea, There is a PBS documentary on how US Fed F**ed up in some ways post 2008 and I was pleased to see Raghuram Rajan along with two other Central Bankers (I think ECB and French CB) in a foreign doc.

And to no matter what side you are on. Skepticism is always good, the problem starts when it starts turning into paranoia. Should people diversify their deposits in IndusInd Bank, absolutely Yes but panic is not a good idea. Trust your central bank.

 

[ramirami]

It seems a lot of the outrage from people is because the bank was "trading in derivatives" which people equate to playing rash in the stock market.

However, I believe here the derivatives were actually to reduce risk - the bank has a exposure to foreign currencies and they cannot possibly make this exposure zero (they are a bank!) and they were trying to hedge the exchange rate risk by trading in derivatives. Had the bank not hedged at all, the loss could have been much larger.

Based on disclosures so far, the issue instead seems to be that the losses in losing trade-pairs did not make it to the banks books but profits in winning trade-pairs did. However trading derivatives was not the problem. Delaying public disclosure and selling off of shares by upper management before public disclosure are some of the problems.

 

[sunit123]

If there is NO liquidity crunch as RBI mentioned they why there is a need to raise 11000 Cr..All is not well

https://www.moneycontrol.com/news/business/all-is-well-days-after-derivatives-loss-indusind-bank-raises-rs-11-000-crore-cds-to-boost-liquidity-12967422.html

 

[hender]

If there is NO liquidity crunch as RBI mentioned they why there is a need to raise 11000 Cr..All is not well

https://www.moneycontrol.com/news/business/all-is-well-days-after-derivatives-loss-indusind-bank-raises-rs-11-000-crore-cds-to-boost-liquidity-12967422.html

Your position is long or short !!

 

[dvader]

If there is NO liquidity crunch as RBI mentioned they why there is a need to raise 11000 Cr..All is not well

https://www.moneycontrol.com/news/business/all-is-well-days-after-derivatives-loss-indusind-bank-raises-rs-11-000-crore-cds-to-boost-liquidity-12967422.html

To prepare for the scenario when people don't understand how banking works and start withdrawing en masse. No bank not even the SIBs (HDFC/SBI/ICICI) can withstand a bank run. This is what a healthy bank does to prepare for mass withdrawals. They have more liquidity than the regulatory requirement and they are still preparing for the worse. They have also set aside a large buffer for their loan books more than the regulatory requirement. That's why I said, their banking is solid.

Again there are other issues with the IndusInd as an entity banking is not one of them.

 

[sunit123]

Your position is long or short !!

I invest and do not trade...I keep an eye on insider trading data on trendlyne...I exited when FII's and CEO sold their stake..

 

[Exewhyzee]

To prepare for the scenario when people don't understand how banking works and start withdrawing en masse. No bank not even the SIBs (HDFC/SBI/ICICI) can withstand a bank run. This is what a healthy bank does to prepare for mass withdrawals. They have more liquidity than the regulatory requirement and they are still preparing for the worse. They have also set aside a large buffer for their loan books more than the regulatory requirement. That's why I said, their banking is solid.

Again there are other issues with the IndusInd as an entity banking is not one of them.

Clearly people withdrawing en masse don't trust RBI in this case.

 

[hender]

I invest and do not trade...I keep an eye on insider trading data on trendlyne...I exited when FII's and CEO sold their stake..

your decision and thought process is really important for the investment.✅🥇

 

[KGSIPO]

I invest and do not trade...I keep an eye on insider trading data on trendlyne...I exited when FII's and CEO sold their stake..

Is trendlyne available free or paid subscription to find the insider trading

 

[sunit123]

Is trendlyne available free or paid subscription to find the insider trading

Free plan...this data is also available on nse and bse but on trendlyne it is more organized

 

[EnthuCC]

Whose failure is fiasco of indusind? Who is responsible?

In this case wouldn't it be the bank auditors?

 

[sunit123]

In this case wouldn't it be the bank auditors?

success ka credit lene RBI aa jata hain or failure ki responsibility bank ki....This is biggest problem in india from top to bottom....everyone is 1st to take credit but no one would like to shoulder responsibility of failure.....Read window mirror theory of leadership.

 

[hender]

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