Mumbai: What began as an account closure request from a Haryana government department has snowballed into a full-scale forensic investigation — and a steep erosion in shareholder wealth.
According to the bank’s stock exchange filing, the issue surfaced when a department of the Government of Haryana requested closure of its account and transfer of funds to another bank. During the process, the bank noticed a discrepancy between the requested transfer amount and the recorded account balance.
Subsequent review of 28 additional accounts operated by Haryana government entities revealed further mismatches. The bank said the matter is currently confined to a specific group of such accounts at its Chandigarh branch.
The aggregate amount under reconciliation stands at approximately ₹590 crore. The final financial impact will depend on validation of claims, recovery from fraudulent beneficiary accounts held at other banks, lien markings, liabilities of involved entities, and the legal process. The bank has suspended four employees pending investigation and said it will pursue disciplinary, civil and criminal action against those responsible.
Meetings of the Special Committee of the Board for Monitoring and Follow-up of Cases of Frauds were held on February 20, 2026, followed by meetings of the Audit Committee and Board of Directors on February 21, 2026. The bank has informed regulators, filed a complaint with police authorities, and requested certain beneficiary banks to mark lien balances in suspicious accounts.
Following the disclosure, multiple news reports highlighted a steep fall in the bank’s stock price, with approximately ₹19,000 crore in market capitalization reportedly wiped out in market trading. The bank said it has engaged KPMG to conduct an independent forensic audit as it works to determine the full extent of the matter. The bank suffered 20% decline. According to India Today, the stock hit a lower circuit shortly after the opening bell, a clear sign of an uncertain market. At around 10:20 am, shares of the lender were trading 16.56% lower at Rs 69.72.
This article is based on the company’s official stock exchange disclosures dated February 21 and February 22, 2026, and publicly available media reports regarding market reaction. The matter remains under investigation, and financial impact estimates are subject to change pending regulatory, legal, and forensic findings.
