HDFC Bank shares fall further following the resignation of Atanu Chakraborty  

Shares of HDFC Bank fell again on Friday; the stock was down more than 2% in morning trades amid wider equity market declines, as concerns linger on what led to the sudden resignation of part-time chairman Atanu Chakraborty and what will be the fallout of the various investigations that are now expected in this regard.
 
It's been a week since Chakraborty resigned, stating "certain happenings and practices" in the bank, that he had observed over two years, were "not in congruence" with his personal values and ethics.
 
He didn't elaborate, nor did he provide any explanation or evidence on what the issues were, and shareholders, investors and analysts are all still searching for answers.
 
A report by the Financial Times has suggested there was a power struggle between Chakraborty and HDFC Bank's MD and CEO Sashidhar Jagdishan, which led to the former's resignation. Jagdishan, as well as the interim chairman Keki Mistry and other board members, have maintained that Chakraborty never provided any reasons or explanation to them and that there were no operational issues in the bank. 

Banking and regulatory sources told Business Today that the Securities and Exchange Board of India was likely to conduct an enquiry into the issues raised by Chakraborty and whether there had been any violation. The Reserve Bank of India too would be watching developments closely and is likely to conduct its own investigation, given its the second-largest bank in the country and a systemically important institution.
 
"Whether any issues were raised in any of the board meetings and if they were, then where they were properly addressed is something that would have to be examined," according to a former Sebi official.
Only Chakraborty knows why he quit, and the "test" would be to make him explain, he added. Sebi chairman Tuhin Kanta Pandey recently stressed that independent directors should act responsibly and avoid making insinuations without proper evidence being recorded. HDFC Bank has also hired three external law firms, which will conduct a review of the resignation and provide a report on the same within a "reasonable" period.

The minutes of the recent board meetings, recordings if any, etc., will have to be looked at to ascertain what happened, if any issues were raised and if and how they were dealt with, say sources.
HDFC Bank has faced several challenges over the past year. The Dubai Financial Services Authority had, in September 2025, restricted the bank's branch in Dubai International Financial Centre from adding new clients, citing regulatory breaches. The bank this week confirmed it fired three employees over those regulatory lapses.

They allegedly mis-sold AT-1 bonds of Credit Suisse to NRI clients through the Dubai branch. The investors had to later incur losses as these bonds were eventually written off after Credit Suisse had to be bailed out by rival UBS amid financial troubles.

Separately, the Lilavati Kirtilal Mehta Medical Trust in Mumbai had last year filed a case against the bank's MD and CEO Jagdishan, accusing him of accepting a bribe to help other erstwhile trustees retain illegal control.

So far, most analysts tracking HDFC Bank have retained their positive ratings on HDFC Bank, although several of them did expect near-term pressure on the stock due to the recent developments.