IDFC FIRST Bank has released the official transcript of the conference call held on February 23, 2026, concerning the recent fraudulent incident. The event, confined to a single branch involving Haryana government-linked accounts, resulted in an estimated discrepancy of INR 590 crores. Management assured stakeholders that the bank is well-capitalized and is aggressively pursuing forensic audits, recovery actions, and implementing enhanced internal controls to address collusion risks.
Transcript Release Following Fraud Incident
IDFC FIRST Bank has officially published the transcript for the conference call held on February 23, 2026, addressing the recent financial irregularities. The call provided context regarding the fraudulent activities which primarily involved collusion between some employees and external parties at a specific branch in Chandigarh.
Scope and Financial Impact
The management confirmed that the incident is isolated to one branch and one client group, specifically accounts linked to the Haryana government. The aggregate discrepancy identified initially through reconciliation stood at INR 490 crores, with an additional INR 100 crores estimated through proactive internal checks, bringing the total preliminary impact to INR 590 crores.
Mr. V. Vaidyanathan emphasized that this was a physical transaction fraud involving forged cheques, not a digital failure. He assured investors that the bank remains well capitalized, with a strong operating profit trajectory having recently crossed 2%.
Bank’s Response and Internal Controls
The bank has acted swiftly by suspending all suspected employees and appointing KPMG as the forensic auditor. Actions taken include filing police complaints and initiating recovery and lien marking across the banking system. Furthermore, the bank is implementing new, mandatory controls for high-value, branch-based transactions, requiring explicit digital confirmation from the customer.
Management noted that while internal controls (maker-checker-authorizer systems, SMS alerts, balance confirmations) were in place, the failure stemmed from collusion of individuals. The bank carries an employee dishonesty insurance cover estimated around INR 35 crores.
Government Business Context
Regarding the government business, the Haryana deposits represent roughly 0.5% of the bank’s total deposits, which overall range between 8% to 10% of total deposits when including central government and PSU entities. The bank expressed confidence that its deep integration and strong relationships across tax collection and service delivery for these entities will help manage the situation and secure necessary assurances.
Forward Outlook
The management anticipates that this incident will be looked through by the market within one quarter. Despite the provision that may need to be taken, the bank expects to remain profitable in Q4, forecasting continued improvement in Net Interest Margin (NIM) and expecting credit costs to decline.
Source: BSE
