Atanu Chakraborty was asked to reconsider decision to quit, take back language in letter: HDFC Bank CEO

HDFC Bank’s chief executive and managing director, Sashidhar Jagdishan, said on Thursday that former chairman Atanu Chakraborty was asked to reconsider his decision to resign. The board also requested him to elaborate on his ethical concerns and take back some of the language used in his resignation letter, said Jagdishan.

Jagdishan said, “every board member” tried to persuade Chakraborty to take back his resignation or elaborate on the concerns so that the same can be readdressed but he did not relent. 

Chakraborty’s resignation, submitted on March 17, came as a surprise to the bank’s board. Independent director M D Ranganath and board member Renu Sud Karnad reiterated during an analyst call that Chakraborty was asked repeatedly to provide specific examples related to his concerns, but none were offered. 

Chakraborty, a retired bureaucrat who served on the bank’s board for five years, cited ethical concerns in his resignation. He stated that certain practices within the bank over the last two years did not align with his personal values. Despite repeated requests from board members to clarify these concerns or withdraw his resignation, Chakraborty did not relent.

Following the resignation, the nomination and remuneration committee discussed the matter on Wednesday. Around 7 PM, four board members, including two wholetime and two independent members, engaged with the Reserve Bank of India (RBI) regarding the situation. Attempts were also made to moderate the language in Chakraborty’s letter, which were unsuccessful, leading to a briefing to the RBI.

The RBI appointed Keki Mistry as the interim chairman of HDFC Bank for three months. Mistry, the former executive vice chairman of HDFC Ltd, described the bank’s governance as top class and emphasised its values of transparency, trust and integrity. He said he would not have accepted the role if he had any doubts about the issues raised.

Mistry also dismissed speculation that the ongoing investigation into the bank’s Dubai operations influenced the resignation, stating the matter is closed and no regulatory action has been flagged by the RBI.