IndusInd Bank , a prominent player in the Indian banking sector, has announced the appointment of Pragati Gondhalekar as its new Head of Internal Audit, effective September 1, 2025. This strategic move comes as part of the bank's efforts to strengthen its leadership team and address recent accounting challenges.

New Appointment and Professional Background

Pragati Gondhalekar brings a wealth of experience to her new role, with over 27 years in global audit and consulting within the financial services sector. Her impressive career includes serving as the Country Head for Group Audit at Deutsche Bank in India and holding leadership positions at L&T Financial Services and PwC.

Gondhalekar's expertise spans:

• Strategic audit leadership
• Regulatory compliance
• Risk management
• Digital transformation
• Board governance

Her qualifications include:

• Chartered Accountant from India and Canada
• Certified Internal Auditor (CIA)
• Certified Public Accountant (CPA) from the USA

Management Reshuffle and Recent Challenges

The appointment of Gondhalekar is part of a broader management reshuffle at IndusInd Bank. Recently, shareholders approved Rajiv Anand as the new CEO and Managing Director for a three-year term. The bank is actively working to fill other key management positions, including the roles of treasury head and chief financial officer, which are currently vacant due to resignations and retirements.

This leadership transition follows a challenging period for IndusInd Bank:

• In March, the bank disclosed a Rs 2,000-crore loss linked to derivatives accounting.
• This led to the departure of managing director Sumant Kathpalia and deputy CEO Arun Khurana in April.
• The bank uncovered accounting issues in its microfinance portfolio, resulting in its largest quarterly loss of Rs 2,329 crore in March.

Financial Recovery

Despite these setbacks, IndusInd Bank has shown signs of recovery. In the June quarter, the bank returned to profitability, reporting a net profit of Rs 604 crore after adjusting for one-time charges. This turnaround demonstrates the bank's resilience and its efforts to address the accounting challenges it faced earlier in the year.

The appointment of Pragati Gondhalekar as Head of Internal Audit is expected to play a crucial role in strengthening the bank's internal controls and financial reporting processes. Her extensive experience in audit and risk management is likely to be instrumental in preventing future accounting discrepancies and ensuring robust financial governance.

As IndusInd Bank continues to navigate through this period of transition and recovery, the new leadership appointments and focus on strengthening internal processes signal the bank's commitment to regaining stakeholder trust and maintaining its position in the competitive Indian banking landscape.

Indusind Bank faced a setback at its Annual General Meeting (AGM) held on August 28, as shareholders rejected a proposal that would have allowed promoters to nominate an additional director to the bank's board. The resolution was voted down by a majority of 54% of shareholders, signaling a clear stance against the proposed change.

Background of the Proposal

The proposal stemmed from a previous amendment to the bank's Articles of Association, which aimed to enable promoters to collectively nominate up to two directors. This change, however, was subject to shareholder approval. The proposed additional director would have been non-executive and non-independent, potentially altering the board's composition and dynamics.

Shareholder Concerns and Promoter Response

The rejection of the proposal highlights significant shareholder concerns regarding board composition and corporate governance. In response to the voting outcome, IndusInd International Holdings (IIHL), a key promoter of the bank, acknowledged the situation, stating that there has been a misinterpretation. IIHL expressed willingness to address the concerns raised by shareholders, indicating a potential for future dialogue and clarification on the matter.

Pending RBI Approval

Adding another layer of complexity to the situation, IIHL's request to increase its stake in IndusInd Bank from the current 15% to 26% is currently pending approval from the Reserve Bank of India (RBI). This proposed increase in stake, if approved, could have implications for the bank's ownership structure and governance.

Market Reaction

The news of the shareholder rejection appeared to have a modest impact on IndusInd Bank's stock performance. Shares of IndusInd Bank closed 0.80% lower at ₹740.90 on the day of the announcement. It's worth noting that the bank's shares have experienced a decline of 5.50% over the past month, indicating broader market sentiment or other factors affecting its stock price.

This development underscores the importance of shareholder voting in corporate governance matters and highlights the delicate balance between promoter interests and overall shareholder sentiment in the banking sector.