IDFC First Bank on February 24 said it has returned Rs 583 crore to Haryana government days after the lender disclosed a Rs 590-crore fraud by its employees.

On Sunday, the bank disclosed the fraud committed by its employees and others in accounts held by the Haryana government.

However, the lender's shares closed trading 1% lower on February 25 despite returning the money and the reason is that the lender returned the money even as investigation is ongoing. The stock had hit 20% lower circuit on intraday basis on February 23.

"Even though the investigation in the matter is ongoing, we have paid out 100% of the principal and interest to the relevant departments of Haryana Government as claimed, which works out to a net amount of Rs 583 crore. The departments have sincerely thanked and appreciated the Bank for the positive approach, professional manner, and speedy and principle-based resolution," the lender said.

On February 24, Haryana Chief Minister Nayab Singh Saini informed the State Assembly that the state government had recovered nearly Rs 556 crore owed to it in the case.

"Nearly Rs 556 crore, including nearly Rs 22 crore in interest, came back within 24 hours," Saini said in the House.

IDFC First Bank says returned Rs 583 crore to Haryana govt but lender's shares aren't rising: Here's why

'Even though the investigation in the matter is ongoing, we have paid out 100% of the principal and interest to the relevant departments of Haryana Government,' the lender said on February 24.

"I want to clarify before the House that the money concerning Haryana government departments, (the) entire amount has been deposited back into our accounts...The recovery has been made within 24 hours," Saini said.

He said the bank had apprised the government that the incident primarily involved a particular branch of the bank in Chandigarh, involving four to five bank employees of middle and lower rung who colluded in the whole thing.

The government will ensure that anybody who is involved – be it a bank employee, private individual or even a government employee -- will not be spared, he said.

On Monday, Saini said the state's Anti-Corruption Bureau would conduct an in-depth probe into the fraud.

"We have formed a committee headed by the Finance Secretary in this entire matter," Saini said on Monday.

Meanwhile, the lender said, "The Bank remains committed to working together with the relevant Haryana Government departments and the law enforcement agencies, to pursue actions against the perpetrators of the fraud and look forward to recovering our dues."