The trigger was the resignation of part-time Chairman and independent director Atanu Chakraborty. In his letter, Chakraborty cited developments and practices at the bank over the past two years that did not align with his personal values and ethics. “This is the basis of my aforementioned decision,” he wrote.
He highlighted that his tenure coincided with key milestones, including the merger with HDFC, which transformed the institution into one of the largest financial conglomerates in the country. While he also noted that the full benefits of the merger are yet to materialise, the move cemented HDFC Bank’s position as the second-largest lender in India.
A near 9% fall in a heavyweight like HDFC Bank underscores the significance of the development and the influence of the individual at the centre of it. Here’s a closer look at Atanu Chakraborty.
Atanu is a retired 1985-batch IAS officer from the Gujarat cadre, who served as the Economic Affairs Secretary in the Ministry of Finance, Government of India, until his retirement in April 2020. He has also represented India as an alternate Governor on the World Bank Board and was a member of the Central Board of Directors of the Reserve Bank of India. His appointment as Union Economic Affairs Secretary was approved by the Appointments Committee of the Cabinet.
He holds a BTech degree in Electronics and Communication Engineering from the National Institute of Technology, Kurukshetra. He further pursued a postgraduate diploma in Business Finance from ICFAI, Hyderabad, and completed his MBA from the University of Hull in the United Kingdom.
HDFC Bank moved swiftly and appointed Keki Mistry, former CEO of HDFC, as interim part-time chairman with approval from the Reserve Bank of India. Following the development, the lender organised a conference call.
What did Keki Mistry say?
Addressing analysts a day after the surprise exit, interim chairman Keki Mistry said there was “no power struggle within the bank” and stressed that the board had not witnessed any kind of complete difference in opinion in its meetings.
“None of us is aware of the issues raised by Chakraborty in [his] letter,” Mistry said, adding that there had been no discussion regarding governance within the board.
Mistry added that the lender’s leadership remained aligned, dismissing suggestions of internal discord. The management team does and will continue to work cohesively, he said, adding that there has been no discussion regarding governance within the board.
Mistry added, “I would never remain on the board if there were any governance issues,” while asserting that the institution remained “very, very strong on ethics.”
The interim chairman also sought to reassure investors and stakeholders, saying there were no material matters at this point in time and that the board remained committed to safeguarding investor confidence.
Mistry also emphasised that the resignation had no bearing on the bank’s business performance. “What happened yesterday has nothing to do with operational profitability,” he added.
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