Largest private lender HDFC Bank said its Board has approved the appointment of external law firms, both domestic and international, to review the resignation letter of former part-time Chairman and Independent Director, Atanu Chakraborty, in a move aimed at reinforcing governance standards.
The decision was made at a Board meeting on March 23, with the law firms tasked with reviewing the contents of Chakraborty’s resignation and submitting their report within a reasonable timeframe, the bank said in an exchange filing.
The private lender described the step as proactive, underscoring its commitment to transparency and robust corporate governance practices.
The move follows Chakraborty’s resignation on March 18 with immediate effect. In his letter, he had stated that certain developments within the bank over the past two years were not aligned with his personal values and ethics. However, the bank clarified that he did not point to any specific happenings or practices that were inconsistent with his values.
Chakraborty has also publicly maintained that his exit was not linked to any wrongdoing or malpractice within the bank, but was driven by a divergence in ideologies and approach. He had joined the bank’s board in 2021.
Following his resignation, the Reserve Bank of India (RBI) approved the appointment of Keki Mistry as interim part-time Chairman for a period of three months starting March 19. Mistry has indicated that there are no major concerns facing the bank after Chakraborty’s departure.
The bank reiterated that the external review is intended to further strengthen governance oversight and ensure clarity around the circumstances of the resignation.
HDFC Bank reportedly terminated three employees, including senior executives, following an internal investigation into alleged mis-selling of high-risk AT1 bonds to NRI clients through its overseas operations.
Shares of HDFC Bank on Tuesday traded over 3 per cent higher at Rs 767.75, hitting an intra-day high on the BSE (as of 10 am). The banking stock had declined 11.73 per cent between the close on March 18 and March 23.
