Amid Insider Trading allegations, IndusInd Bank seeks asset details of senior officials, say sources

IndusInd Bank

IndusInd Bank has sought details of assets and liabilities of middle and senior level officials. In an email sent in March and a reminder this month, lender has asked the officials to share the details by May 31st, said a source, aware of the issue. The said source added that, so far IndusInd Bank had never sought such details from its staff. Though some banks have a policy of declaration of assets by staff.

An email sent to staff read, “As an ethical and good governance practice, the Code of Conduct calls for transparency in dealing of our employees”. Email further read, in compliance to the directions of the management all the employees are requested to submit information.

As per the email, officials have been requested to provide information of assets and liabilities accurately and completely to human resource department. Bank has assured that the confidentiality will be maintained.

An email sent to IndusInd Bank sent for comments did not elicit any response.

Some senior officials and key management people are under market regulator Securities and Exchange Board of India’s (SEBI’s) scanner for insider trading. Regulator’s investigation is for suspected insider trading in banks own shares as well client shares. Moneycontrol had reported that up to 6 senior officials of the bank are under Sebi’s radar for insider trading in client companies.

Sebi had sought details from the bank in April, including all the whistleblower complaints and minutes of audit committee of board. Sebi’s investigation in the matter is on going and in next 1-2 months and order may be passed based on the findings. Sebi’s investigation is also looking if the management or board had any role to shield such officials despite the alert from whistleblower complaint.

Allegedly these bankers were trading in client company shares based on insider information sought for lending and other purposes. As a lender these bankers were aware of important corporate events, credit approvals, debt repayment, IBC process update and other information.

Meanwhile seeing various complaints on insider trades by bank staff, Sebi is planning to conduct a crash course for listed bank’s top management including compliance officers, MD&CEO and independent directors. Sebi may roll out this crash course as early as next month.