HDFC Bank: AIBEA writes to FM for probe into issues raised by former chairman Atanu Chakraborty

Concerned over the recent resignation of Atanu Chakraborty as the part-time Chairman and Independent Director of HDFC Bank, the All India Bank Employees’ Association (AIBEA) has written to Finance Minister Nirmala Sitharaman for a comprehensive enquiry into the issues raised by him.
 
“We write to express our deep concern over the recent resignation of the Part-time Chairman and Independent Director of HDFC Bank, wherein the resignation letter explicitly cites that certain ‘happenings and practices’ within the bank were not in consonance with his personal values and ethics,” CH Venkatachalam, General Secretary, AIBEA, said in the letter.
 
Since HDFC Bank is designated as a Domestic Systemically Important Bank (D-SIB) by the Reserve Bank of India, this development raises serious questions about governance standards, regulatory oversight, and systemic stability, he further pointed out in the letter.
 
Urging immediate intervention by the government, the AIBEA has called for five-pronged action including a comprehensive inquiry into the issues raised, assessment of governance, compliance, and risk management practices and public disclosure of findings to ensure transparency and maintain depositor confidence. It has also sought initiation of an independent probe, if warranted, involving CVC, CBI as well as examination of the matter by appropriate Parliamentary Committees, considering the systemic implications and public interest involved.
 
“The explicit mention of ethical incongruence by an Independent Director is highly unusual and warrants immediate investigation,” the AIBEA said, adding that the lack of clarity on the nature of the reported ‘practices’ by a very high Executive of the bank may erode public confidence in the banking system.
 
“Given the systemic importance of the institution, any governance lapse can have far-reaching consequences for financial stability,” it said, requesting for government intervention to safeguard the interest of the 120 million customers of HDFC Bank in particular and people at large in general so that millions of customers, depositors and stakeholders feel re-assured.  
 
In a sudden development, Chakraborty resigned from his role as the part-time chairman of India’s largest private sector lender on March 18, citing differences on values and ethics.