ICICI Bank has launched a second external inquiry into allegations of irregularities in 31 loan accounts by a third whistleblower, according to a report by The Economic Times.

Crime specialist law firm Panag & Babu has reportedly been hired to investigate allegations of the bank having inflated profits by at least $1.3 billion over eight years by delaying provisioning for 31 non-performing asset (NPA) accounts.

"An independent law firm has been appointed by the audit committee to assist it," a bank spokesperson was quoted as saying.

"In the past, the ICICI Bank board had to be nudged to initiate any enquiry. Now it’s clear they want to steer themselves out of any controversy, which is why they have initiated another probe," a source told the newspaper.

"I believe the scope of investigation is limited to allegations levelled in the third whistleblower complaint," the source was quoted as saying.

The news daily quoted another source as saying that the bank had already submitted an interim report to the Reserve Bank of India (RBI) and that the appointment of an external agency was to conduct an exhaustive probe.

ICICI Bank has been facing allegations of "irregularities in the conduct of some borrower accounts" and "incorrect accounting", as a result of a third whistleblower complaint in as many years.

After the complaint was received in March, the country's largest private lender instituted an inquiry into the matter under the supervision of the audit committee of the board of directors.

While no specific examples were cited in the complaint, the whistleblower had alleged overvaluation of security for corporate loans.

Earlier, the bank's internal investigation had found that all 31 loan accounts had been classified non-performing assets (NPAs) well before the complaint was filed.

Of these, 29 accounts were classified as NPA between March 31, 2012 and March 31, 2017. Two others had been classified as NPA between March and December, 2017, the bank said.

The report submitted to the RBI, however, showed no irregularity and that all accounts had been provided for. Further probes into the matter were commissioned after reports of investors' and experts' scepticism emerged.

This probe into allegations of irregularities will be different to the investigation being conducted by retired Supreme Court judge BN Srikrishna into accusations of conflict-of-interest against Chief Executive Officer Chanda Kochhar.

Speaking about the completion of the ICICI Bank probe, Srikrishna had earlier said that the panel had met just once thus far and it was inadequate to submit a report