IDFC First Bank shares crack 20% on ₹590 cr fraud at Chandigarh branch

IDFC First Bank identified an incident involving alleged unauthorised and fraudulent activities by certain employees at a branch in Chandigarh

Shares of IDFC First Bank Ltd. tumbled 20 per cent on Monday after the lender detected a ₹590 crore fraud at one of its branches in Chandigarh, leading to a suspension four of its branch employees. 

 

IDFC First Bank stock fell as much as 20 per cent during the day to ₹66.8 per share, the lowest level since June 2025. This is compared to a 0.65 per cent advance in Nifty 50 as of 09:48 AM. The counter has fallen 22 per cent this year, compared to a 1.6 per cent decline in the benchmark Nifty 50. IDFC First Bank's total market capitalisation fell to ₹57,485.6 crore. 

 

Story behind IDFC First Bank stock crash

The bank has identified an incident involving alleged unauthorised and fraudulent activities by certain employees at a branch in Chandigarh, the lender said in an exchange filing on Sunday.

 

The issue came to light after the bank received a request from a Haryana government department to close its account and transfer funds to another bank, it said. During the process, discrepancies were observed between the amount mentioned in the request and the actual account balance. 

 

From February 18, 2026, other Haryana government entities also approached the bank regarding their accounts. Similar differences were found between the balances recorded by the bank and those cited by the respective government entities.

 

A preliminary internal review indicates that the matter is confined to a specific group of government-linked accounts of the Haryana government operated through the Chandigarh branch and does not impact other customers of the branch, the bank said in the statement. 

 

The aggregate amount under reconciliation across the identified accounts is approximately ₹590 crore. This is more than the ₹503 crore net profit it reported for the October-December quarter of 2025-26.

 

The final impact will depend on further information, validation of claims, potential recoveries, liabilities of other entities involved, and the outcome of legal recovery proceedings, it said. The bank has suspended four officials suspected to be involved, pending investigation. 

 

IDFC First Bank said it had filed a complaint with the police authorities and was also in the process of filing further complaints with appropriate law enforcement agencies and reporting to relevant authorities. The bank said it would extend full cooperation to investigating agencies.

IDFC First Bank management commentary 

A forensic audit into the suspected fraud will be completed in the next four to five weeks, Bloomberg reorted quoting IDFC First Bank management said during an analyst call.

 

Chief Executive Officer V Vaidyanathan said the recovery process has already begun and the bank is currently working out the scope of the forensic audit. He added that the bank does not expect the fraud to have any material impact on its costs. Chief Financial Officer Sudhanshu Jain said the bank will continue to maintain high liquidity buffers as a precautionary measure.