New Delhi: Shares of IDFC First Bank plunged 20 percent on Monday, hitting Rs 66.80 on the NSE-the lowest level since October 2025. The stock had opened at Rs 75.16, down 10 percent from its previous close of Rs 83.51, but selling pressure increased through the day.
The sharp fall came after the bank disclosed a Rs 590-crore fraud at its Chandigarh branch, raising concerns over financial impact and governance.
What Is the Fraud Case?
In an exchange filing, the bank said unauthorised and fraudulent activities were detected at a specific branch in Chandigarh. The issue surfaced when Haryana state entities tried to close their accounts and found mismatched balances.
The amount under reconciliation is around Rs 590 crore and may change as more details come in. The bank has suspended four employees and appointed KPMG to conduct an independent forensic audit. It also said recovery efforts are underway, including from linked accounts at other banks.
At the same time, the Haryana government de-empanelled IDFC First Bank and AU Small Finance Bank from parking state deposits.
Possible Impact on Financials
According to global brokerage UBS, the suspected amount equals about 22 percent of the bank’s FY26 estimated profit after tax. However, the impact on capital is expected to be limited to around 1 percent of net worth.
Morgan Stanley estimated the hit to FY26 profit before tax at nearly 20 percent. Analysts also warned that scrutiny of government deposits in private banks may increase, which could affect low-cost CASA deposits across the sector.
Big Losses for Major Shareholders
The stock crash wiped out over Rs 14,300 crore in market value in a single day.
The Government of India, holding a 7.75 percent stake (66.65 crore shares), saw a notional loss of about Rs 1,113.83 crore. LIC, which owns 2.35 percent, faced a loss of around Rs 338 crore.
Other insurers like ICICI Prudential Life and HDFC Life also saw losses. Retail investors, who hold over 15 percent stake, saw nearly Rs 2,163 crore erased from their wealth.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Stock market investments are subject to risk. Investors should consult certified financial advisors before making any investment decisions.
