Shares of IDFC First Bank plummeted by 20% on Monday, February 23, 2026, hitting the lower circuit following the discovery of a massive ₹590 crore fraud at its Chandigarh branch. The irregularities came to light after the Haryana government requested to close a department account, only to find a significant discrepancy between their records and the bank’s actual balance. Investigations revealed that the fraud involved unauthorized manual transactions and forged entries carried out by certain employees in collusion with external parties, specifically targeting accounts linked to the Haryana state government. In response, the bank has suspended four officials, appointed KPMG to conduct an independent forensic audit, and filed a formal police complaint. While MD and CEO V. Vaidyanathan assured investors that the incident is “isolated” and not a systemic failure, the market reaction was severe, wiping out nearly ₹14,000 crore in market capitalization. The fallout has been compounded by the Haryana government’s decision to de-empanel the lender, directing all state departments to shift their funds to nationalized banks. Despite the RBI’s statement that there is no broader systemic risk, the stock remains under heavy pressure as investors weigh the impact on the bank’s annual profits and internal governance standards.
